The times for ‘blind’ inspections are slowly becoming a thing of the past. At present, tax authorities have a number of analytical tools at their disposal, which allow them to precisely select the entities subject to control. New regulations are also being introduced that are gradually broadening the powers of tax authorities in respect of their inspection activities, while the staff of tax authorities is showing a high degree of specialisation. In recent years, there has been a steady increase in the number of tax audits, customs inspections and the number of irregularities identified by the tax authorities. Increasingly, large companies are being audited, making tax collection more proficient.
All this shows that it is advisable for taxpayers to be well prepared for possible tax audits or customs inspections. They should ensure well in advance that they know how to proceed in the event that an audit action is initiated, as well as learn what the powers of authorities are.
Moreover, it is recommended for taxpayers to adopt a proactive approach during audits and clarify on an ongoing basis any doubts raised by tax authorities. Taxpayers should demonstrate an appropriate evidentiary initiative and ensure that all information confirming their position is included in the case file (at the stage of administrative courts, there can no longer be an evidentiary proceeding).
Key areas of inspections
- exercising due diligence
- application of 0% and other reduced rates
- international transactions (e.g. VAT and exports)
- fixed place of business
- cash registers and invoicing
- financial services and exemptions
- VAT returns
- withholding tax
- accounting for the cost of intangible services
- anti-avoidance clause
- tax exemptions
- passive payments
- tax rates (double tax treaties)
- conditions for tax relief (Estonian CIT, R&D and IP Box relief)
- B2B, work, commission and employment contracts with the owner of a limited company
- incentives, competitions and loyalty programmes
- free benefits
- 50% tax deductible expenses for employees
- delegation to work in the EU/outside the EU; business travel benefits
-legality of work and residence of foreigners in Poland; illegal or bogus employment
- transfer pricing analyses
- intangible services
- financial transactions
- intangible assets (economic and legal ownership, DEMPE analysis)
- recharacterisation of transactions
- transfer pricing adjustments
-restructuring and reorganisations, long-term tax losses
- classification of goods with special reference to electronic equipment
- preferential origin
- customs value, in particular non-transit or between related parties
- the monitoring of customs decisions taken
- classification of vehicles for excise duty purposes
- fulfilment of the conditions for the application of the 0 rate
- fulfil the conditions for the application of exemptions
- fulfilment of the conditions for the application of reduced rates
How can we help you?
Our Tax Litigation Team provides comprehensive support both in preparation for, during and after tax audits and customs inspections.
- We offer the support in preparing for a tax inspection so that it goes as smoothly and as stress-free as possible.
- We provide training for those responsible for dealing with tax authorities, during which we will discuss the course of the audit, point out the powers of auditors and the obligations of auditees.
- We will prepare an internal instruction on the rules of conduct for employees in the event of the initiation of a tax audit, customs inspections or verification activities.
- We will develop a litigation strategy.
- We will communicate with the respective tax authorities on your behalf.
- We will represent you as attorneys at the stage of an initiated inspection.
- We will prepare or review statements in the course of tax audits and customs inspections.
- We will review existing documents to serve as evidence during the audit.
- We will prepare pleadings confirming the arguments in support of the taxpayer’s position.
- We will accompany you at every stage of evidentiary activities (including witness interviews and visual inspections).
- We will prepare the necessary pleadings, including statements and objections to tax audit reports, appeals.
- We will prepare further strategy for dealing with tax authorities and administrative courts (once the audit has been completed).