Do you have a tax audit and the auditors are idle for a long time? Let's take a look at whether this situation can be a risk for you and needs to be addressed, or if it will be appropriate to just wait for the tax administrator to contact you in your proceedings.

First of all, it is good to realize that tax audits and tax imposing proceedings now have statutory deadlines by which these proceedings must be completed. That is certainly correct, and infinitely long-term tax audits are practically a thing of the past. In the case of a tax audit, the basic period is 1 year, in the case of a tax imposing procedure, it is 3 months. The tax administrator therefore has a limited time to check the correct taxation at your place and possibly to end the tax audit without a finding. However, if during the tax audit the tax administrator disputes the documents submitted by you, the ball returns to the tax entity, who is expected to remove the tax administrator's doubts. If he does not do so, the tax administrator will not recognize the tax expense or deduction of input VAT.

Secondly, it is therefore good to realize that in order to remove the doubts of the tax administrator, the taxpayer himself will need time, both to prepare new arguments and to submit or take new evidence, or to call a witness. If the tax administrator does not have enough time to take the evidence proposed by you, he will terminate the proceedings and, we dare say, to the detriment of the taxpayer, because the taxpayer did not remove the doubts of the tax administrator.

You can say that you can challenge such a procedure of the tax administrator. Yes, it is possible, but thirdly, you need to realize that such a defense against the actions of the tax administrator will cost you your time and resources. At the same time, the best thing you can achieve in this situation is the annulment of the illegal decision of the tax administrator for insufficiently ascertained facts and the return of the case to the tax office for further investigation of the case. In this dispute, you get to the very beginning and the tax proceedings continue.

Therefore, we see great importance in the time effectively used by the tax administrator during the tax audit, because the tax administrator will recognize your arguments for the first time, if you have enough time and space to explain, substantiate and prove your claims.

If the time by the tax administrator during the tax audit is not used effectively, the consequences will be borne only by you and this will be reflected in lengthy tax proceedings, including court proceedings, which may return once or several times to the very beginning - to the evidence phase.

We believe we have clearly explained to you the possible procedures in case of inactivity of the tax audit. If you still have any questions, do not hesitate to contact us. You can find other useful information on our website, Facebook or Linked-In.