Tax advisers: how to look after clients who live abroad

Why do more and more of your clients live abroad?

More Germans leave the country than come back. In 2023, about 74,000 more German citizens moved abroad than returned (according to the Federal Statistical Office, Destatis). For tax advisers this means: more and more clients live abroad, but still have tax obligations in Germany.

Tax liability does not stop at the border: this applies to limited or extended limited tax liability, for example from rental income, a pension, a permanent establishment or investment income. And communicating with the tax office (Finanzamt) becomes much more work for the adviser when the client can no longer be reached in Germany.

What are the three biggest problems with clients abroad?

1. Delivery problems and missed deadlines

The tax office sends notices to the address it has on file. If the client lives abroad, deemed delivery (Zugangsfiktion) under § 122 (2) no. 2 German Fiscal Code (AO) applies: a letter counts as delivered one month after it was posted, unless it arrives later or not at all; in case of doubt the tax office has to prove it.

For you as an adviser, this means:

• Objection periods run before the client has seen the tax assessment notice (Steuerbescheid)
• Estimated assessments (Schätzungsbescheide) become final because the request to file a return never reached the client
• Reminders and notices of enforcement reach the client too late

2. No reliable postal address

Many clients ask relatives or friends to "check the letterbox now and then". In practice, this often works only for a short time. Then mistakes creep in:

• Letters are overlooked or forgotten
• Urgent post is not recognised as urgent
• Forwarding by photo or WhatsApp is unstructured and hard to trace

3. Why is ELSTER not enough?

Even if you use ELSTER to communicate with the tax office electronically, the tax office often still sends certain letters by post, for example:

• Audit orders (Prüfungsanordnung, § 196 AO)
• Notices about account data retrievals (Kontenabruf)
• Liability notices (Haftungsbescheide)
• Reminders and notices of enforcement

Some of these letters go to the client's address, not to you as the adviser.

How can PortoDoc be your clients' authorised recipient?

As a tax adviser, you can recommend PortoDoc as authorised recipient (Empfangsbevollmächtigter) to clients who live abroad. This is how it works in practice.

Step 1: the client sets up PortoDoc

The client gets a postal address in Ahrensburg near Hamburg with a personal PD number. It is a delivery address for letters, not a business, registered-office or imprint address.

A power of attorney under § 123 AO: the client gives PortoDoc this power of attorney and names it to the tax office, either directly or through you as their tax adviser. The online account shows under "For the tax office" what to enter.

Step 2: letters are digitised

We scan each letter and make it available in the client's online account.

Step 3: AI deadline hints (from Business)

From the Business plan, an AI deadline hint marks possible deadlines: a non-binding aid. The client gets an e-mail for every new letter. The letter itself is what counts, and the client (or you as their tax adviser) checks every deadline.

What does your practice gain?

What should you check for clients abroad?

Authorised recipient under § 123 AO

Discuss with your clients whether they should name an authorised recipient. Without one, the tax office keeps writing to the address it has on file, and deemed delivery applies in full.

Outside the EU and the EEA, a request is binding: clients who live there must name one if the tax office asks them to (§ 123 sentence 1 AO). If they do not, a letter posted to them counts as delivered one month after it was posted (§ 123 sentence 2 AO).

Limited vs unlimited tax liability

Check for each client: does it make sense to apply to be treated as subject to unlimited tax liability under § 1 (3) Income Tax Act (EStG)? The basic tax-free allowance (Grundfreibetrag; €12,348 from 2026, § 32a EStG) can save more than the tax return costs.

Double tax treaties

Germany has double tax treaties (Doppelbesteuerungsabkommen) with many states; the Federal Ministry of Finance (BMF) publishes an overview of their current status every year. Check which income is taxed in which state, and whether the client can claim an exemption or a credit.

Extended limited tax liability under § 2 AStG

Clients moving to a low-tax country may be subject to extended limited tax liability under § 2 Foreign Tax Act (AStG), for ten years after the end of the year in which their unlimited tax liability ended. Broadly, taxation counts as low if the income tax burden abroad is more than one third lower than in Germany (§ 2 (2) AStG).

Further conditions include at least five years of unlimited tax liability as a German national in the ten years before it ended, and substantial economic interests in Germany. This calls for particular care.

Conclusion

Looking after clients abroad is one of the most demanding tasks in tax advice. Deemed delivery, unreliable post and complex international tax law together create real risks, for the client and for the practice.

PortoDoc solves the post problem: letters from the tax office arrive at one address in Germany and are available online, wherever your client lives. Deadlines stay with the client and with you, because PortoDoc gives no tax advice and does not monitor deadlines. Recommending it to clients abroad can save time and make working together much more efficient.

More background: our guide for tax advisers with clients outside Germany.