Appealing of Tax Inspection Acts
Legal support of appealing of tax inspection acts
Tax audits, regardless of the type of business activity, are an integral part of the business process. At the same time, despite a clear mechanism for regulating their conduct, entrepreneurs very often disagree with the results of the acts of on-site and cameral inspections and decide to challenge such acts. This is due to the fact that in most cases, according to the results of a tax audit, even despite the existence of objections to the audit report, additional taxes are charged, administrative liability is imposed in the form of a fine, or, for example, VAT refunds are denied. Objections to the act of tax audit are an essential part of the interaction with the tax authority. Some of the issues that are included in the audit report can be considered by the tax authorities and settled with the entrepreneur without an appeal procedure.
At the same time, the right to appeal is enshrined in Article 137 of the Tax Code of the Russian Federation, which says that each person has the right to appeal against non-normative acts of tax authorities, actions or inaction of their officials, if, in the opinion of this person, such acts, actions or inaction violate his rights. At the same time, it is important to note that acts of tax authorities can be appealed in court only after they have been appealed to a higher tax authority.
The complaint must indicate:
- last name, first name, patronymic and place of residence of the individual filing the complaint, or the name and address of the organization filing the complaint;
- complained act of a non-normative tax authority, actions or inaction of its officials;
- name of the tax authority whose non-normative act, actions or inaction of officials of which are being appealed;
- legal grounds on which the complainant believes that his rights have been violated;
- claims of the complainant;
- option of obtaining a decision on the complaint: on paper, in electronic form via telecommunication channels or through the taxpayer's personal account.
The Tax Code of the Russian Federation fixed, among other things, the deadlines for appealing against decisions of a tax authority, so for appealing against a decision of a tax authority that has entered into force, which was not appealed on appeal, the legislator determined a period of 1 year, and for an appeal against a decision to hold liable – 1 month. In addition, the procedure for filing a complaint and an appeal is also determined, a complaint is filed with a higher tax authority through the tax authority, whose acts are being appealed. After receiving the complaint, the tax authority whose decision is being appealed forwards the documents to the higher tax authority within 3 days.
Based on the results of consideration of the complaint (appeal), the higher tax authority:
- declares complaint (appeal) unsatisfied;
- cancels an act of a non-normative tax authority;
- cancels the decision of the tax authority in whole or in part;
- cancels the decision of the tax authority in full and adopts a new decision on the case;
- recognizes the actions or omissions of officials of the tax authorities as illegal and makes a decision on the merits.
In order to accept a complaint for consideration, it is important to comply with the requirements of tax legislation for the procedure for filing a complaint, in addition to attaching the evidence and justifications that the entrepreneur refers to when filing a complaint. However, the reasons for refusing to accept a complaint for consideration may be:
- failure to comply with the requirements for filing a complaint;
- elimination of all violations by the tax authority;
- riling a complaint on the legal basis.
Only after consideration of the complaint by the higher tax authority, the entrepreneur can apply for the protection of his interests and the resolution of the dispute with the tax authorities to the judicial authorities. Complaints (statements of claim) against acts of tax authorities filed with the court are considered and resolved in the manner prescribed by the legislation of the Russian Federation. The statement of claim is submitted to the Arbitration Court of the constituent entity of the Russian Federation at the location of the tax authority, with the decision of which the entrepreneur does not agree. In this case, the basis for applying to the court to protect their interests may be:
- violation of the terms for making a decision on a complaint filed with the tax authority;
- entrepreneur’s complaint was left unsatisfied;
- a decision of the tax authority has been partially canceled and does not satisfy the requirements of the entrepreneur.
It is important to note that filing a statement of claim with the court is possible only on the grounds on which the appeal was made to the tax authority, while in order to apply for the protection of one's interests, one must apply to the court no later than 3 months from the date of the decision on the complaint by the higher tax authority. To file a lawsuit, you must:
- conduct an analysis of the financial documentation and make sure there is no wrongdoing;
- prepare a statement of claim with accompanying documents and evidence that the entrepreneur is not at fault;
- analyze judicial practice on similar grounds for filing a claim.
At the same time, in order to successfully conduct tax audits, entrepreneurs need to prepare for them in advance and put the documentation in order, for example, by conducting a tax audit by a qualified specialist. This will minimize the risks of obtaining a tax audit report with detected tax violations, which then will have to be appealed not only to a higher tax authority, but also in court.
- Advising clients on field and cameral tax audits
- Legal assistance in challenging the acts of field and cameral tax audits
- Preparation of necessary documents for contesting acts of tax audits
- Representing the interests of the client in interaction with the tax authorities