VAG Error Code: 16705 = EOBD II Error Code: P0321 Fault Location: Crankshaft Position (CKP) Sensor/Engine Speed (RPM) Sensor.
The Engine Speed Sensor (G28) is also used as a reference sensor for the crankshaft position and correlates with the Camshaft Position Sensor Bank 1 (G40) and Camshaft Position Sensor Bank 2 (G163).
P0321 = Ignition/Distributor Engine Speed Input Circuit Range/Performance
If you locate your oil filter assembly, look towards the driver side on the engine block near the engine / transmission split. There's a sensor that's bolted in with an allen-head cap screw.
That's the Crankshaft Position (CKP) Sensor.
Check the many on-line auto parts sources, such as; www.partstrain.com, www.partsgeek.com, www.carpartswarehouse.com, or www.rockauto.com for the replacement parts.
For example, they (RockAuto) list the crank position sensor from around $34.00 for your vehicle.