The Rough Guide to Preparing For Tax Field Audits in Russia and how Alinga Consulting Group can help
Any company can be audited by the Tax Authorities. There is a false belief that a field audit can only be done after a company has existed for at least three years. However, the law says nothing of this.
The tax authorities’ system for planning field audits lists criteria that allow the taxpayer to self-assess their field audit risk.
Six of the more important ones listed below:
- The tax burden is below average for their industry.
- Losses are reported for the last several tax periods.
- Significant tax deductions are declared in one period.
- Expense growth outpaces income growth.
- Employee average monthly wage is lower than the industry average.
- The business is engaged in activities with a high tax risk (no personal contact CEOs of business partners; no ID copy for the CEO of partners on file; business partners do not have a real office…).
In practice, a field audit can be initiated based on reasons not mentioned in the conception: frequent “corrections,” increased revenues with no change in the amount of tax paid, filing for VAT reimbursements, applying tax breaks, etc., can all trigger a field audit.
As it is time to choose an auditor for your annual audit you may want to consider Alinga’s Role in preparing your company for a Tax Audit.
What do you need to do to make sure you get through yours with minimal losses?
If the company performs an annual audit to intensively review the accuracy of tax calculations, the tax risk is pretty small and preparing for a tax audit is easier. If audits haven’t been performed, the company should carefully prepare for the field audit.
Of course, in either case, extra hands never hurt. Field audits usually cover three years’ worth of reporting and, after being notified of the audit, a business has just 10 business days to submitting all documents. Alinga can assist in all this, uncover your tax risks at short notice, and support your company during the entire audit process by making sure that the tax authorities themselves are operating within the bounds of existing legislation.
Alinga Consulting has extensive experience in performing tax audits, Tax Due Diligence, and tax consulting. Many of our specialists have formerly worked for the tax authorities and therefore know how risks are to be assessed. Alinga will support you at every level of cooperation with the tax authorities!
Specifically, Alinga can:
- Prepare companies for tax audits;
- Support during tax audits;
- Preparing documents required by the tax authorities during the audit;
- Preparing written responses to tax claims;
- Preparing complaints to the higher tax authority;
- Appealing decisions on prosecutions for tax violations;
- Supporting and defending companies’ interests in court.
Our specialists can help you with these issues:
Tel. +7 (494) 988-21-91б ext. 194
Mobile: +7 903 561 31 14