Field tax audit: procedure, deadline, purpose

Each entrepreneur is faced with different tax audits. They can be cameral or exit, planned or unscheduled. They are carried out exclusively by inspectors working in the Federal Tax Service, and a special commission is appointed to visit the enterprise itself. It is important to understand what an on-site tax audit is when it is carried out in relation to a certain enterprise, in what time frame the planned activities are carried out, and also what is the purpose of the conduct.

The essence of verification

Inspectors claim that visiting the enterprise and examining its documentation on site is the most effective and reliable way to verify the company. Features of an on-site tax audit include:

• the main purpose of this event is the need to make sure that the accountant of the organization correctly determines the amount of tax, and also pays it competently;
• arrears and other problems are revealed by the results of the process;
• if there are serious violations, the company will be held liable, and it may even be criminal for the management of the company;
• surprise is a significant factor, and this is especially true for unscheduled inspections, so inspectors can prevent the destruction or hiding of documentation;
• such an event is held both in relation to different companies and to individual entrepreneurs;
• the basis for the procedure is the order of the head of a certain branch of the Federal Tax Service, but in some situations the order may be issued by his deputy.

Verification is carried out at the location of the company. If the company has branches in other cities, then the documentation can be studied in these units.

What are the limitations?

Almost all firms are afraid of this event, since almost always inspectors identify significant violations, which leads to holding the company management accountable. But conducting a field tax audit has certain limitations.

These include the fact that it is not possible to plan to check the documentation of the enterprise if the company was opened less than three years ago. For one period it is impossible to study the same papers twice.

What are the deadlines?

The procedure can take a different amount of time, as different factors influence this. The standard term for a field tax audit is two months, and this time period is clearly indicated in the Tax Code.

If there are difficulties or too many documents, then it is allowed to increase the process to four months. If the company under study is closed, then the on-site tax audit can take up to six months.

Six months is the maximum period during which inspectors can check the documents of a company in its office if this process is not suspended for various reasons.

Types of Checks

The procedure may be different, as it differs by various criteria.

It is unscheduled inspections that are considered the most severe and scary for all companies. This is due to the fact that employees cannot prepare for visiting inspectors, therefore they are often lost and scared. Such studies are quite rare, as inspectors should have suspicions that if employees of the company are notified, they can destroy important documentation. The basis is complaints or direct evidence of serious violations committed by employees of the company during the functioning of the company.

Preliminary stage

The verification process consists in the implementation of several stages, since the taxpayers who will be visited by inspectors are initially selected. At the end of the study, a decision is made by specialists on the basis of the information received. Each stage requires the implementation of certain complex actions.

The preparatory phase involves the formation of a plan of field tax audits. It contains information about which particular enterprises will be researched, how much time will be spent approximately on each participant, and also when this or that company will be visited. Additionally, the following actions are performed:

• inspectors are identified who will participate in field audits of tax authorities;
• information is being studied about all taxpayers included in the plan;
• identified risks of violations;
• it is determined which taxes will be studied, which period will be affected, and which measures will be carried out to obtain the necessary information;
• It is calculated how much time and labor will need to be spent to carry out the process;
• approval of the obtained quarterly plan is made.

When choosing the companies that will be involved in the audit, the Federal Tax Service uses its data sources, and also takes into account various complaints and other company data.

After collecting the necessary data regarding all companies, a special dossier is created for each taxpayer.

How are participants selected?

The process of selecting companies for which an on-site audit will be conducted is divided into several successive stages. These include:

• 1st stage. It consists in determining how many companies can be inspected for a certain period of time, usually represented by a quarter. Based on this information, a plan is drawn up. The workload of each employee of the enterprise over the past two years is taken into account.
• 2nd stage. A list is formed of all companies that must be checked, so they are included in the plan.
• 3rd stage. The conclusion is drawn up by an employee of the Federal Tax Service, who is engaged in the analysis of financial indicators of enterprises, which allows us to identify which firms it is advisable to check in a particular quarter.
• 4th stage. Taxpayers are identified, which are included in the plan in the first place and are priority. For this, the results of previous desk audits are taken into account. It also decides which companies need to be visited again to make sure that they comply with the instructions of the last inspection commission.
• 5th stage. An annual list of taxpayers is compiled, which must be subjected to research. The document is confidential, therefore, it is not allowed for employees of the Federal Tax Service to disclose information.

The essence of an on-site tax audit is not only to identify various irregularities, but also to prevent their consequences, therefore, if according to the results of a desk study of the documentation there are suspicions that the company systematically violates the rules for calculating different taxes, then it will be checked on the spot.

Which firms risk getting into the plan?

When determining which taxpayers will be included in this list, different parameters are taken into account by inspectors. But at the same time, the firms themselves can determine whether an on-site tax audit will be conducted in relation to them. Most often, companies with the following characteristics are included in the list:

• expenses practically do not exceed incomes;
• for one tax period, several deductions were issued;
• expenses regularly exceed cash receipts;
• there are inconsistencies in economic indicators that are identified in the process of studying documentation at the Federal Tax Service;
• service employees received information that various documents were damaged or intentionally destroyed in the company;
• A complaint was written to the Federal Tax Service containing information that the company uses various illegal methods to evade taxes, therefore the tax base is unreasonably reduced;
• size indicators are close to limit values, allowing you to use the simplified mode;
• the organization has entered into agreements with a huge number of counterparties that do not bring any benefits;
• if in the process of conducting a desk audit inconsistencies are identified, then the employees of the Federal Tax Service require taxpayers to provide explanations, and if they are absent, the company is included in the list of field events.

Enterprises themselves must analyze the risks of including them in the audit plan. The provisions on the basis of which the organization of an on-site tax audit is posted directly on the FTS website. Criteria by which firms are included in the plan are also added here.

What do inspectors check?

Documentation related to various tax fees or other payments is subject to verification. Not only taxes are allowed to be checked. An on-site tax audit involves examining securities that identify various discrepancies and arrears.

Inspectors can request documentation:

• book of income and expenses;
• various payment documents, checks, invoices or other similar papers;
• receipts from tax;
• cash or bank papers;
• work licenses, Articles of Association and other constituent documents;
• various primary business papers;
• invoices;
• charts of accounts;
• accounting documents;
• tax reports;
• waybills, acceptance certificates and other papers.

The term of an on-site tax audit in most cases depends on how many documents specialists will have to study.

How do firms learn about verification?

The notification process depends on whether the study is planned or unscheduled. In the first case, the on-site inspection of the tax office is carried out after prior notification of the taxpayer. For this, a letter is usually sent to the address of the company.

If an important point in the study is the effect of surprise, then the company's employees are not notified in any way about the planned process. This applies to unscheduled inspections.

The plan is a confidential document, so if employees of the Federal Tax Service disclose information from it, they will be held accountable. Therefore, an unscheduled field tax audit is conducted without notice to the taxpayer.

How are firms notified?

If a planned study is carried out, then initially all taxpayers included in the list are notified of the planned event. Usually, methods are used for this:

• personal delivery of the notice to the representative of the company;
• sending a registered letter, and a receipt of delivery must be paid;
• Forwarding of the notice in electronic form via TCS.

Next, the company representative must come to the department of the Federal Tax Service to obtain a copy of the verification decision. On a copy of the institution must sign.

When is an unscheduled audit?

To conduct this study, you don’t have to wait until permission is received from the Federal Tax Service, and the taxpayer is not notified about this event. In this case, there must be good reason for such a check. These usually include:

• the company during work harms the health of citizens;
• the integrity of the country's cultural heritage is violated;
• harmful to the environment;
• the enterprise does not eliminate violations identified during a desk or past field audit;
• there is a requirement of the prosecutor's office in relation to a particular enterprise, on the basis of which an unscheduled study of the documentation is needed.

There are certain situations when it is necessary to promptly and promptly conduct an audit. For this, employees of the Federal Tax Service should send a special notice to the prosecutor's office, after which the company’s research begins the next day.

Process steps

The research procedure of any institution involves the implementation of successive stages. The procedure for conducting an on-site tax audit is to perform the following actions:

• a decision is made to conduct a study;
• inspectors come to the company, after which they pass the decision to the head of the company;
• allocated to inspectors a separate room where they will be comfortable working;
• inspectors require the necessary documentation for the study;
• they can inspect the premises and the area adjacent to the building;
• they have the right to conduct a full inventory;
• sample documents may be subject to examination;
• in case of serious violations, paper may be seized in full;
• the minimum testers are in the company for two months, but this period can be significantly increased, and legislation also allows the suspension of the study if necessary;
• if there is a suspension of verification, the process can take up to 15 months;
• at the end of the process a decision is made, binding on the enterprise.

If after the inspection various significant violations are revealed, the company will have to pay fines, and often officials are brought to criminal or administrative liability. That is why business leaders do not want a field tax audit conducted against them. The period of verification of documents usually does not exceed two years, but it is allowed to request documents for past tax periods in order to identify arrears or other problems.

How are documents seized?

For the event, inspectors must receive the necessary documents. The procedure for an on-site tax audit involves the ability to seize documentation for different periods. When this process is completed, there must be employees of the enterprise, witnesses who do not work in the Federal Tax Service and in the audited organization, as well as the inspectors themselves.

Before the documents are seized, the inspector passes the corresponding decision to the head of the company, and also explains what rights and obligations a citizen has. Initially, it is proposed to voluntarily submit the documents, and if the inspectors are refused this request, they will seize the paper by force.

The research procedure is carried out only in the daytime, but at the same time it may exceed the life of the enterprise. Documents are not checked from 22 to 6 hours.

How is the end of the check drawn up?

As soon as all the studies are carried out in relation to the documentation of the enterprise, the verification ends. It is made out by drawing up a special certificate in the prescribed form. It is presented in Appendix No. 7 to the order of the Federal Tax Service No. MMV-7-2 / 189.

It does not spell out the results of an on-site tax audit, since it is necessary only to notify the management of the company that the procedure has been completed. It contains information:

• the date of formation represented by the date the audit ended;
• details of the decision on the basis of which the study was conducted;
• information about the taxpayer, to which his name, checkpoint, taxpayer identification number and other data relates, depending on whether he is an individual entrepreneur or a company;
• all taxes and periods that were affected in the study are given;
• if during the procedure there was a need to suspend or extend the verification period, this fact is indicated in the certificate;
• at the end is the signature of the inspection official.

If the document is personally transmitted to the head of the enterprise, then he must put on the copy the signature with the decryption. After drawing up the certificate, it is believed that the audit has been completed, so the inspectors are not further allowed to request any additional documents or even be in the company.

The nuances of drawing up an act

The main purpose of the audit is the identification of various violations related to the payment of various taxes or other payments. Therefore, a decision is always made based on the results of a field tax audit. For this, a special act is formed.

The act of an on-site tax audit is formed within two months after the end of the study. The countdown is carried out from the moment when the taxpayer received a certificate of completion of the audit.

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• for all the nuances, it is advisable to immediately give explanations so that various obscure data are not perceived by inspectors as a violation;
• if inspectors put forward different requirements, then they should be treated carefully to determine what are the possible consequences of their non-fulfillment;
• if minor defects are identified, they must be promptly corrected, if possible;
• if the inspectors themselves make violations and mistakes during the investigation, then they must be recorded, since due to them it is possible to challenge the results of the audit in the future;
• it is important to behave calmly and confidently, and even more so it is not allowed to insult or threaten the inspectors.

Taking into account the above recommendations, it is guaranteed that there are no problems for the company management when communicating with inspectors.

Nuances of verification at the closing of the company

Companies can be closed for various reasons, as there may be no profit or the goal of opening an enterprise is achieved. The process can be not only voluntary, but also compulsory.

Some firms undergo liquidation inspections by the Federal Tax Service. To do this, checking companies come to the office of the company. Inspection workers determine whether the company has debts, whether they can be repaid, and other significant factors are identified. That is why, if management decides to close the company, then the Federal Tax Service should be informed about this promptly.

With such a check, it is necessary to select a separate cabinet for the reviewers. They can request documents for three years of work of the company. The head of the company may be present during the study.

Thus, on-site inspections are an effective way of control by the Federal Tax Service. They can be planned or unscheduled. They are carried out in the correct sequence of actions. Each head of the company should be well versed in what rights and obligations inspectors have, what documents they can request, and how they should complete the inspection. In this case, you can protect and defend your rights in case of violation by the employees of the Federal Tax Service.