One of the biggest fears for any taxpayer is to be subject to a tax inspection.
Not knowing how to act, the insecurity and the fear can all play a major factor on whether you reach a positive or negative outcome during the inspection process. E.B.F. Consulting are experts in tax, accounting and legal advice. Below are some steps to take during a Tax Inspection.
First of all, when the Tax Authorities decide to initiate an inspection they notify the tax payer a summons via certified post. The date that the summons is received is from when the days are counted to present allegations. For this reason, it is recommended that you do not refuse to receive the notification, if the Authorities can not notify you then it will be published in the BOE (oficial state newsletter) and you may not become aware of the contents of the notification, losing your rights to submit allegations and claims.
The following details should appear in the notification:
– Complete details of the taxpayer subject to the inspection.
– Place and time to meet the inspector, the authorities have the freedom to conduct this meeting in the Tax Office or in the taxpayers business address.
– The taxes to be revised and the corresponding years.
– Scope for the proceedings.
– The deadline for tax revenue.
– Place and time from where the notification has been issued and details of the person who has signed the document.
When the inspection takes place you should provide the inspector with all the documentation that has been requested and collaborate as much as possible.
Finally, the Authorities will perform appropriate proceedings collecting the facts shown or set out in the Act. It is important to read it carefully before signing it and, if there is something that you are not in agreement with, then request that the Inspector details your comments in the Act.
SURPRISE INSPECTION
It is not unusual for the Inspector to present themselves at your home (if you registered as working from home) or at your public office without prior warning. Naturally they must show their identity and prove that they represent the Tax Authorities.
YOUR HOME
The internet has allowed people to carry out their business from home. It is important for you to know that Article 18.2 of the Spanish Constitution states that your home can not be violated or infringed – it is not to be accessed unless:
1. The owner has given consent
2. There is a legal warrant/court order 3. A crime has been committed
Therefore if an inspector comes to your home you have two options 1) give your consent for him to enter or
2) do not allow him to enter unless he has a court order.
YOUR OFFICE
If you work from an office that is open to the public you can still deny the inspector access, however in this case you may be accused of “obstructing the inspection” and be subject to a penalty.
If the inspector comes with an authorisation from the Area Representative of the Tax Authorities you can still deny access and insist that the inspector returns with a Court Order. Should you allow them to enter then the Inspection cannot take place without the Director or Legal representative present. If you are the Administrator/Director you can request the presence of your legal fiscal adviser and the inspection cannot take place until they arrive.
If the inspector appears with a Court Order it is no longer a requirement that the Director or Legal Fiscal Adviser be present. However, you can still challenge the Court Order if there are no minimum indications to justify the inspection.
REVISION AND INSPECTION OF COMPUTERS
There are areas in an office that do require a Court Order to be accessed, principally those that are not accessed by the public. If the inspector wants to revise your computer then be aware that he can only refer to the accounts of your business and not revise client files, emails, web navigator history etc.
It is important that you understand you have an obligation as a taxpayer to facilitate the inspector’s work, providing at all times the information that is needed as well as the passwords to access your computers. They have the right to seal any equipment and files until they can be accessed legally.
If you have nothing to hide, then collaborate.
Information by E.B.F Consulting S.L. E.B.F Consulting has been providing tax and accounting services to expatriates in Europe since 1999. Office is based in Lanzarote, Spain. Visit www.ebfconsulting.com for more details. Copyright © E.B.F Consulting 2017 All Rights Reserved