Checklist of tax risks 2022: how to identify and avoid them

We recently held a webinar on Clerk where we talked about tax risks for companies. We have collected the most important things in our checklist today. He will help you analyze the state of your business, identify tax risks, and tell you how to eliminate them.

The checklist contains the following information:

• key tax risks regarding corporate income tax and VAT;
• methods for independently identifying such risks;
• options for their elimination or minimization.

Risk No. 1. Cooperation with unscrupulous counterparties

What will be the consequences of failure to eliminate

Denial of income tax expenses and VAT deductions.

How to identify risk

1. Select counterparties with contracts for significant amounts.
2. Exclude well-known companies in your industry from the list of selected counterparties.
3. For the remaining counterparties, analyze information from open sources for the presence of risk criteria.

Eliminating risk

After identifying high-risk counterparties, ensure that you have a set of documents confirming that you exercised due diligence and commercial diligence before entering into an agreement with each counterparty.

Analyze these documents for errors, inconsistencies, as well as changes in requirements for the counterparty, taking into account the duration of the cooperation period. If negative factors are identified, it is necessary to bring the documents into proper form.

If such documents are missing, send a lawyer’s request to the counterparty to provide documents and information confirming the availability of labor and material resources to fulfill contractual obligations.

In addition, check whether all funds have been paid to counterparties under existing agreements.

If settlements under the agreement are not completed, consider suspending the payment of funds under agreements with the specified counterparties in order to initiate pre-trial, and in some cases, judicial settlement of the dispute.

At this stage, it is necessary to collect security files that allow you to record the reality of the dispute and, consequently, the relationship with the counterparty:

• notarize correspondence with officials of the counterparty in instant messengers and email;
• save claims, reconciliation reports, responses to claims, receipts, checks for sending postal items;
• document meetings of the parties with appropriate protocols, as well as record them using audio and video means;
• conduct legal interviews with officials, etc.

In the event of a trial, the documents available in the case materials, as well as the fact of the dispute itself, will additionally confirm the commercial independence and independence of the parties.

If there is no debt to the disputed counterparty, it is necessary to analyze the relationship and the results of the contract and, if possible, initiate a legal dispute with the counterparty.

Why check your counterparty?

Entrepreneurs partly depend on how well their partners fulfill their obligations. Therefore, the efficiency of the business also depends on the approach to choosing counterparties. If the new partner does not deliver the goods on time or does not check the documents, there will be negative consequences.

Let's imagine that a businessman launched a new online store and began actively looking for suppliers. He was able to conclude an agreement with a well-known company in a narrow niche on favorable terms and is now waiting for a large shipment of goods. But the partner did not ship the products on time and customers were left without their orders.

In such situations, a business has to urgently look for an emergency exit so as not to destroy a fragile reputation that is just beginning to form. Customers are not interested in the reasons why they will not be able to receive their order on time. For them, the situation looks clear - the online store has not fulfilled its obligations, which means it should not be trusted in the future.

Partnerships with other companies are the foundation on which any successful business project is based. If at the stage of concluding agreements the entrepreneur did not pay attention to the warning signs, this may result in financial losses.

If we are talking about a new project that is still unsteady on its feet and has not yet gained a market share, not only the ability to impose competition on niche leaders, but also the payback period depends on the approach to the selection of business projects.

Unplanned expenses can cancel out the development strategy and the entrepreneur will have to justify himself to investors. To avoid such situations, you need to carefully check your counterparties and work with them only if there is strong evidence of reliability.

Problems with counterparties also arise because a certain number of companies are problematic by default. They have a lot of lawsuits, negative reviews and a bad reputation in the business community. They take advance payments and do not fulfill their obligations on time.

Beginning entrepreneurs often fall into “nets” because they do not pay enough attention to checking the counterparty and rely on the fact that all business representatives work honestly. As a result, they lose money or reputation, and the fate of the project is in jeopardy.

Checking counterparties makes it possible to:

1. Identify problem partners. An in-depth check will help identify companies with which you should not cooperate under any circumstances.
2. Detect scammers. Fly-by-night companies often take money and that’s where the cooperation ends. It happens that a company provides false documents and is not registered as a legal entity.
3. Avoid cooperation with bankrupts. Some companies enter into agreements with counterparties even at the liquidation stage. At a time when investors cannot get their money, and customers are left without goods or services.
4. Protect yourself from problems with the Federal Tax Service. For example, the tax inspectorate may deprive a bona fide entrepreneur of a tax deduction if Federal Tax Service employees are not confident that the entrepreneur has conducted a thorough check of the counterparty and that he has fulfilled his obligations.

The main problem of many businessmen is superficial knowledge of legislation. They hire accountants to send reports to the tax office on time, but they independently check potential partners. And they conclude an agreement only on the basis of the constituent documents.

There is a rule in tax legislation that is aimed at combating deliberate optimization of taxation. In simple terms, the Federal Tax Service checks any tax reduction under a microscope. Just one mistake is enough for employees of a state organization to assess additional taxes in the next reporting period.

For example, to receive a tax deduction, you must not only provide closing documents for the transaction, but also confirm that it took place in real life, and not just on paper.

Stories of entrepreneurs show that any flaw in a transaction between counterparties can lead to devastating consequences. For example, after an audit, companies will be assessed additional taxes of several million rubles. Such situations periodically occur with large companies whose turnover amounts to hundreds of millions.

The tax office processes a large amount of information every day and always takes care of the interests of the state. Therefore, if an entrepreneur makes at least one small mistake, it can be decisive for starting a lawsuit. And then you will have to pay not only taxes, but also legal costs.

If an individual entrepreneur or legal entity enters into an agreement with a counterparty that has recently been excluded from the register, serious problems will arise with the Federal Tax Service . Such situations are far from uncommon, because in the pursuit of optimizing business processes, owners of conscientious companies often do not pay attention to important tasks.

The tax office analyzes not only the timeliness of payment of fees, but also the content of contracts. And if there are inaccuracies in it, which can be interpreted in different ways, they may charge additional taxes, refuse to provide a deduction, and create other problems.

Risk No. 2. Business splitting is declared illegal

Liability for failure to eliminate

Recalculation of tax liabilities using the general taxation system.

We identify signs of fragmentation

If your business contains several legal entities, check your structure for the presence of legal entities and individual entrepreneurs that apply special tax regimes (STS, patent, Unified Agricultural Tax) or use tax preferences (regional preferential tax rates, benefits of special economic zones, benefits for IT- companies).

If there are such organizations or individual entrepreneurs in the group, the following circumstances will indicate potential risks

• the presence of a unified management apparatus;
• general accounting, warehouse, office space or retail space;
• companies or individual entrepreneurs have the same phone numbers and addresses;
• the right to sign in bank documents of one organization of a group of companies is granted to employees registered in other organizations of the group of companies;
• an identical IP address for all companies or individual entrepreneurs, generated when accessing the Bank-Client system, as well as submitting financial and tax reporting;

Signs of crushing can also be seen if:

• employees undergo interviews in the office of one company;
• there is a transfer (re-registration) of employees from one company to another;
• advertisements for hiring employees of all companies or individual entrepreneurs are prepared and posted by the HR department of one company;
• the activities of all companies or individual entrepreneurs are built into a single production/trading cycle.
• all companies or individual entrepreneurs use one website, registered under one legal entity, on which its contact information is posted in the absence of information about other group members.

How to eliminate or minimize the risk

1. Eliminate or minimize identified factors that indicate artificial fragmentation of the business.
2. Prepare an economic justification for the splitting carried out, based on the official positions of the Federal Tax Service and the Ministry of Finance, as well as conclusions arising from current judicial practice.
3. Collect documentary defense files that support the position you have formed. For example, a model that provides conditions for registering new group members, a business development strategy when entering new markets (regions), etc.
4. Consider structuring a group of companies or individual entrepreneurs using a franchise (commercial concession agreement).

Financial statements

Most recently, the Federal Tax Service introduced another service - the State Information Resource for Accounting (Financial) Reporting. With its help, the taxpayer can obtain the balance sheet of the counterparty he is interested in, provided that such counterparty has provided its accounting statements.

Information from balance sheets has been published by Rosstat before, but this usually happened in September. Now information appears more quickly. As of today, data for 2022 is already available. At the same time, the absence of a balance sheet handed over by the counterparty is in itself a reason to ask a question.

When analyzing the counterparty’s balance sheet, it is worth paying attention to the lines “Tangible non-current assets” and “Accounts payable”.

The first line indicates the presence (or absence) of fixed assets at the enterprise. Accordingly, if you have fixed assets, you can worry a little less that during a tax audit you will be punished for not having the necessary resources from your counterparty.

As for accounts payable, an alarming marker is its “freezing”. If a creditor flows from year to year or even grows, it is worth thinking about its nature and the tax risks that such a counterparty may accumulate.

The ability to look at the balance sheet is also valuable from the point of view of preventing business risks.

For example, when deciding on the shipment of goods with the provision of deferred payment, it is important to have an idea of ​​the balance sheet structure and data on the presence of significant “creditors” or losses.

Risk No. 3. Reclassification of relationships with self-employed and individual entrepreneurs into labor ones

Failure to eliminate this risk will result in additional personal income tax and insurance premiums.

We identify the risk of contract requalification

If you cooperate with self-employed people and individual entrepreneurs, factors indicating the presence of a risk of reclassifying the relationship as an employment relationship will be:

• work or services are performed in collective labor conditions, subject to internal labor regulations and compliance with labor discipline;
• fixed payment for the labor process, and not for the final result;
• regular and equal amounts of payments;
• duration of relationships with self-employed and individual entrepreneurs;
• the search for performers is carried out by posting job advertisements ;
• the presence of facts confirming that performers passed interviews in the human resources department instead of communicating through the procurement department or legal department;
• their previous performance of duties under an employment contract in your organization;
• availability of equipped workplaces on the customer’s premises;
• self-employed and individual entrepreneurs perform work (provide services) exclusively to your organization in the absence of other customers.

We eliminate risks under controversial contracts with self-employed people

The main thing is to end relationships with performers who previously worked in your organization or individual entrepreneur.

To attract new performers (self-employed or individual entrepreneurs), you need to use special online services, not job boards.

Additionally, you can make sure that the performers have other clients besides your organization, and also document this fact.

If the performers do not have other clients, it is necessary to motivate them to do business with other clients. Otherwise, it is advisable to consider the possibility of refusing to continue relations with such performers.

Analyze contractual relationships with performers and eliminate signs that may indicate a risk of reclassifying the relationship as an employment relationship.

If performers have jobs, you must refuse to organize them on the territory of your organization.

Watch the webinar recording: “Tax risks in 2022 and methods for minimizing them.”

Here's how to check the counterparty yourself.

Step 1: Request a set of live documents

Request copies of key documents from your potential counterparty. For companies, this is a charter, a tax registration certificate (TIN), a certificate of assignment of the main state registration number (OGRN), as well as a decision or protocol on the appointment of the general director. For individual entrepreneurs - a certificate of assignment of the main state number of an individual entrepreneur (OGRNIP).

If an organization or individual entrepreneur is registered in 2022 or later, then instead of registration certificates they only have sheets for recording information in registers. This is fine.

Willingness to provide documents at your request is a good sign. This means that the counterparty is serious and ready to work in good faith. And in the event of a court case or claims against you from the tax authorities, requesting constituent and registration documents from your partner is a plus in your favor to confirm the fact that you checked the counterparty.

If you are planning to enter into a transaction for a large amount, the counterparty's charter will show how it can conclude such a transaction and whether it can do so at all. To do this, you need to study the rules for approving a major transaction and check the competence of the manager.

For example, for an LLC, by law, a major transaction is a transaction or chain of transactions worth more than 25% of the value of the company’s assets. Sometimes business owners limit large transactions to a specific number. For example, a transaction worth more than 500 thousand rubles is considered large. In this case, the director cannot sign the agreement if it is not approved by the decision of the owners of the organization.

Step.2 Get a current extract from the register

Check the basic data of the organization with which you are going to enter into an agreement. To do this, take a free extract from the Unified State Register of Legal Entities, in which you look at the general data: registration date, address, authorized capital, telephone numbers, full names or names of managers and founders, types of activities of the organization.

Extracts are publicly available on the tax website; you can check the counterparty by TIN, OGRN or name.

Check that all this matches your expectations and common sense. It will be strange if you enter into an agreement for the supply of fittings with a company that deals with children's parties.

An alarming sign is the large number of very different types of activities of the company, from selling baby food to oil refining. This may be a sign of a garbage company that is being used to siphon money. And the absence of the necessary type of activity to conclude a transaction, according to tax inspectors, is one of the signs of a fly-by-night company.

The supply agreement that the company from the previous example entered into was related to petroleum products. But for some reason, the company bought petroleum products from a company that, according to documents, sells paints and varnishes, sheet glass, sanitary equipment and other construction materials. The IRS didn't like it.

But that's another matter. The company was brought to justice, among other things, because it entered into agreements for the repair of equipment with contractors who, according to the Unified State Register of Legal Entities, do not engage in this type of activity. The main activity of one counterparty is general construction work. Another is forestry and services in this area. It shouldn't be this way.

Also, look to see if there is a note in the statement about the unreliability of information about the general director or address. This should be alarming. Inaccurate address information means that the organization does not receive correspondence at the address specified in the Unified State Register of Legal Entities or is not located there at all. And the unreliability of information about the general director indicates that the director indicated in the Unified State Register of Legal Entities does not fulfill his functions. Perhaps it was a nominal director who left long ago.

Pay attention to the size of the authorized capital if your potential partner is an LLC. The minimum amount of 10 thousand rubles for a serious organization, together with other alarming factors, is also a reason to think about it.

This is what a mark indicating the unreliability of information about the general director looks like. This means that the director is listed incorrectly in the statement.

This is what a mark indicating that the address is invalid looks like. According to the tax authorities, the organization is not located at this address

Step.3 Check the counterparty's address

Check the counterparty's address to see if it is a mass address. A bulk address is the address of the location of a large number of organizations that simply buy it on the Internet for registration. Thousands of different companies can be located at one address.

This may mean that the counterparty is not located at the stated address. It will be difficult to find in case of conflict. A mass address purchased for registration may not in itself indicate the unreliability of the counterparty, but in the overall picture of the audit it should raise red flags.

Step.4 Check if the director is disqualified

Look for the head of the counterparty in the register of disqualified persons. Also, check information about persons who, through the court, refused to manage a potential partner.

A disqualified director does not have the right to manage the company and enter into contracts. He cannot do anything at all on behalf of the organization, unless by proxy. For amateur activities, such a director faces administrative liability.

Step.5 Clarify what kind of business the counterparty is conducting: small or medium

Check the register of small and medium-sized businesses to determine what type of counterparty it is: micro-enterprise, small or medium-sized enterprise. This will show the level of turnover of the company and the number of employees in the organization.

Small businesses can have up to 100 employees, while medium-sized ones can have between 101 and 250 people, according to official data. A fly-by-night company or fraudulent organization will not employ such a number of people.

Step.6 Check if the counterparty is bankrupt

Check the federal bankruptcy registry to see if your counterparty is about to go bankrupt or is in receivership.

If bankruptcy proceedings are introduced against a counterparty, its activities are suspended: it cannot enter into transactions at all. You cannot work with such a company.

If bankruptcy has just begun, you should wait: the financial situation may stabilize. If the future partner himself filed for bankruptcy, most likely he is cunning and has no money - it is better not to mess with such a person.

Step.7 See if the counterparty is excluded from the Unified State Register of Legal Entities

Look in the State Registration Bulletin for messages about the upcoming exclusion of an organization from the Unified State Register of Legal Entities as inactive.

If there is such a message, it looks like a scam - be careful. You may be the scammer's latest attempt to illegally enrich himself.

For example, you really need to install new desks in your office, you enter into an agreement with a counterparty, give an advance, and then find out that he has already been excluded from existing legal entities. Unpleasant.

Step.8 Search for the counterparty in the bailiff database

You can check the organization for the presence of debts and enforcement proceedings for their collection on the website of the Federal Bailiff Service.

Enforcement proceedings begin after cases are won in court. This suggests that the potential partner not only sues and loses, but also continues to not pay his bills.

On the same resource you can view tax debts; they are also collected through bailiffs.

Check results on the FSSP website. There are too many enforcement proceedings.

Step.9 Check the counterparty in the file of arbitration cases

The file of arbitration cases will tell you in what legal proceedings the counterparty is involved, what obligations it does not fulfill, with whom it is in conflict and why. Or maybe, on the contrary, your future partner is always on the side of good and justice.

If a supplier has several lawsuits with customers in a row, a contractor is suing a customer over the quality of work, or an organization regularly forgets to pay for electricity - this is a reason to think about it. Or you can ask your future counterparty about this question directly.

Checking the counterparty in the Arbitration Case File. It’s better to search by INN or OGRN; you can go straight to those cases where the counterparty is the defendant.

Step 10 Find out if the counterparty has a profitable business

Review and show your accountant the counterparty's accounting data. In them you will see what happened to the company’s finances over previous years: how much they earned, how much they lost, went into negative territory or became positive.

Data on the reporting of LLCs, PJSCs, JSCs and even non-profit organizations can be found on the websites of the Center for Corporate Information Disclosure and the Federal State Statistics Service. A profitable accounting past is a good sign.

In the Corporate Information Disclosure Center you can see a lot more interesting things: persons associated with the company, decisions of participants and even issue documents.

Balance sheet of Mosenergo. Everything is fine here financially.

Step.11 Check the passport for validity

Another useful service is the list of invalid Russian passports on the website of the Ministry of Internal Affairs.

It will be unpleasant to find out that the general director, representative by proxy or individual entrepreneur has an invalid passport. This fact clearly indicates that you need to be careful with such a counterparty. Maybe there was a glitch in the passport data accounting program, or maybe the passport was used by scammers who stole it.

Step.12 Check whether the power of attorney has expired

If a person with a notarized power of attorney is going to sign the contract on the part of the counterparty, it is better to play it safe and check the power of attorney using the details on the website of the Federal Notary Chamber.

If there is no power of attorney on the website or it has been revoked, the agreement cannot be signed - such a transaction may be declared invalid. First you need to contact the head of the counterparty, obtain evidence of approval of the transaction and request a new power of attorney.

Step.13 Check the validity of the license

If your counterparty must have a license to carry out activities, it is better to check its validity - you never know. Without a license, he simply does not have the right to enter into transactions.

The presence of a license can be viewed in an extract from the Unified State Register of Legal Entities on the tax website, and its validity can be checked directly.

For example, you can check a license for the sale of alcohol in the register of licenses of the Federal Service for Regulation of the Alcohol Market, and for educational activities - in the register of licenses of the Federal Service for Supervision of Education and Science.

On the Fedresurs service you can check construction organizations: in which self-regulatory organizations (SROs) they participate. No licenses are needed for construction, but membership in an SRO and permits are required.

Step.14 See if it is a nominee director

See if the director manages several organizations at once. This can be done on the website of the Federal Tax Service.

It happens that fraudulent companies simply pay some person to be a director in 5, 10 or even 15 companies. This is a clear sign of a shell company or a company that illegally transfers money abroad.

This director runs ten organizations - it looks like these are shell companies.

Step.15 Check changes in the Unified State Register of Legal Entities

You can also find out whether the director or owner of the organization is changing on the Federal Tax Service website. Perhaps the director with whom you are negotiating the deal has already written a letter of resignation.

Making any changes to the Unified State Register of Legal Entities is a reason for a potential partner.

This is what information looks like when an organization is changing its CEO.

Step.16 Conscientious supplier

Many construction organizations and suppliers participate in government tenders for government procurement. When they do not fulfill their obligations, they are included in the register of unscrupulous suppliers. You can check whether the counterparty is included in such a register on the procurement website.

Inclusion in the register of unscrupulous suppliers does not immediately characterize the organization as unreliable. But together with other verification methods it will create an overall picture of the counterparty.

Risk No. 4. Risks of attracting third-party employees (outstaffing)

What will be the consequences of failure to eliminate

Refusal to accept VAT deductions for transactions with companies providing personnel for rent (hereinafter referred to as outstaffers).

We determine the presence of risks in the company

If third-party employees are hired, the following circumstances may indicate the presence of risks:

• lack of information on the Rostrud website about whether the outstaffing company has accreditation as a private employment agency and the corresponding license;
• the outstaffer is an affiliate of you ;
• the outstaff company was registered shortly before the conclusion of the transaction to provide employees;
• your organization is the only customer for the outstaffing organization;
• Employee interviews are carried out by specialists from the HR department of your organization;
• recruitment advertisements are prepared and posted by the HR department of your organization;
• recruitment advertisements contain telephone numbers and other contact details of your company ;
• employees previously worked in your company, but were provided by other outstaffers.

We eliminate risks if they exist

First, you need to delete advertisements for hiring employees if they exist. Then - cancel the process of your organization’s specialists conducting interviews of accepted employees.

Be sure to: terminate relationships with employees who previously worked in your organization, as well as those previously provided by other outstaffers.

You can also collect information about the existence of labor disputes between employees and outstaffers, which will confirm the reality of their relationship .

Additionally worth:

• stop making payments for employees who are not actually working, for example, on vacation (if any);
• initiate labor disputes with outstaffers, in which it is possible to document the relationship between outstaffers and employees.

Risk No. 5. Reclassification of movable property into real estate

If the tax authorities decide that the movable relation refers to the immovable property, then you will be charged additional property tax on the reclassified objects.

What you should pay attention to

Select property that, according to your organization's accounting, is not included in the calculation of the property tax base.

Then evaluate this property: is it an integral functional part of any complex real estate object, for example, an enterprise as an industrial complex, and is it firmly connected to the land?

If yes, then there is a high risk of such property being reclassified as real estate.

How to avoid reclassification of property category

1. Send a lawyer's request to the supplier or manufacturer of the property to provide information on the possibility of dismantling the property and using it at other facilities.
2. Carry out and document the disposal of property from the production cycle when replacing it with a new one, for example, the sale of property with the subsequent acquisition and installation of a new one.
3. Conduct an examination in order to obtain an expert opinion confirming that the property is movable.

If these recommendations cannot be implemented, then in the future it is necessary to create a reserve that takes into account possible additional tax charges.

Checking the counterparty for legal services

The File of Arbitration Cases, located at: https://kad.arbitr.ru/, is highly informative. It provides information about all arbitration disputes involving your counterparty since at least 2010, and often about earlier disputes.

Analysis of arbitration cases is not only the identification of bankruptcy filings, but also information about how often and for what reason the counterparty does not fulfill its obligations. Filing a claim for an amount comparable to or exceeding the amount of the counterparty's assets is a valid reason not to cooperate with him until such a case is resolved.

The card index allows you to request information by name, OGRN or TIN.
In practice, it is better to check the existence of arbitration disputes using all the specified details, since court employees often make mistakes when entering information into the file cabinet. File of cases of courts of general jurisdiction - https://sudrf.ru/ is significantly less useful for two reasons:

• Difficulty in identification. The card index searches only by name; there is no search by INN/OGRN. The file does not contain information about the addresses of the parties. It is almost impossible to check, for example, with its help - the sample will contain hundreds of cases involving companies with the same name.
• The file does not contain information on the amount of claims for cases that have not yet been considered. Accordingly, before the decision is made and its publication (which usually takes about a month), find out whether a debt of 100 thousand rubles has been collected. or 100 million rubles. impossible.

When checking the debts of a counterparty, you should definitely use the database of enforcement proceedings - https://fssprus.ru/.
The service allows you to find out not only about the number of debts, but also whether they are being collected. There are many companies on the market that often act as defendants in civil cases. Using the database of enforcement proceedings, you can quickly conclude which companies you should not cooperate with. These are companies in respect of which there is information about the termination of enforcement proceedings on the basis of paragraph 3 and paragraph 4 of Part 1 of Art. 46 of the Federal Law “On Enforcement Proceedings”, that is, due to the impossibility of locating the debtor or his lack of property.

To a lesser extent than in inspections of a counterparty and to a greater extent when conducting an audit of a company before its purchase, the register of inspections of the Prosecutor General’s Office of the Russian Federation is useful - https://proverki.gov.ru/. Using the TIN or OGRN of an organization, you can obtain information about the inspections being carried out, the inspection body, the status of the inspection (scheduled/unscheduled) and its result.

Risk No. 6. Denial of the right to deduct “excess” interest expenses

Liability for failure to eliminate

Additional charge of income tax based on the maximum amount of interest expenses established by the Tax Code.

How to detect presence?

Check:

• the presence of loan agreements with affiliated foreign or Russian companies;
• whether the contracts establish floating interest linked to the LIBOR/EURIBOR rate;
• Are they expected to change in connection with the planned abolition of the LIBOR rate, as well as the introduction of new confidence intervals for interest rates in the Tax Code of the Russian Federation from January 1, 2022?

How to prevent additional income tax charges

Revise the terms of the borrowing so that the interest is within the confidence interval or prepare a justification for the deviation of interest from the confidence interval according to the transfer pricing rules.

To do this, you can conclude additional agreements to existing loan agreements, providing for the interest rate to be linked to the rates established by the Tax Code of the Russian Federation for calculating the confidence interval (STR, SHIBOR, SOFR, SONIA, TONAR, SOFR).

Decide whether it will be possible to repay the debt early if you cannot justify or reduce the interest level to fall within the confidence interval.

Contour.Focus: opportunities for checking the counterparty

Based on the number of sources described, we can conclude that finding a counterparty and checking its reliability is an extremely difficult job, and this is true. But this work can literally be minimized to one click using a service such as Contour.Focus.

Why the service is convenient:

• The search for a company or individual entrepreneur is carried out by name, address, full name, tax identification number and other parameters. The relevance and reliability of information is guaranteed through access to official government open sources.
• In addition to the latest extracts from the Unified State Register of Legal Entities and the Unified State Register of Individual Entrepreneurs, the user receives data from the Card Index of the Supreme Arbitration Court, the Federal Bailiff Service, the Federal Treasury Database of Government Contracts, the Unified Federal Register of Bankruptcy Information, and the Rosstat Organizations Accounting Database.
• The company card, in addition to all other necessary information, includes a selection of links with mentions of the company on the Internet, which allows you to speed up the process of collecting facts by aggregating information from the media, from forums with reviews, from the website of the company itself and the websites of its partners, suppliers and clients, from the issuer's information disclosure page, from news resources.
• The service user can put 1000 companies under surveillance. Upon learning of changes in data, Contour.Focus will notify the user about them by email.
• The service is able to analyze organizations according to criteria preset by the user.

Risk No. 7. Recharacterization of a loan into an investment

What awaits the company in this case?

Refusal to account for expenses related to the payment of borrowed interest, additional assessment of income tax.

If there is a loan from affiliated parties, the following factors may signal possible risks:

• irregular repayment of the loan body and/or accrued interest (delay on the part of the debtor);
• lack of a loan repayment schedule and/or accrued interest;
• non-market level of interest rate on the loan;
• proceeds from loans were spent on the purchase of expensive assets.

How to minimize this risk:

1. Find reasons to initiate debt collection proceedings.
2. Initiate debt collection procedures: start corresponding with the debtor, send a pre-trial claim, receive a written response about the impossibility of repaying the debt or about the amount of the minimum possible repayment.
3. File a claim in court.
4. Enter into a settlement agreement providing for the payment of collateral and a debt repayment schedule.
5. Comply with the conditions stipulated in the settlement agreement:

• arrange a deposit;
• follow the payment schedule.

Risk No. 9. Formation of a permanent representative office of a foreign group company in the Russian Federation

Liability for failure to eliminate

Recognition of the activities of a foreign person in the Russian Federation leading to the formation of a permanent representative office, additional assessment of such person with Russian income tax, fines and penalties.

How to determine if there is a risk

To do this, it is necessary to analyze the nature of the activities of all group companies on Russian territory for:

• correct classification of activities (preparatory and auxiliary);
• the beginning of activities that go beyond the scope of auxiliary and preparatory;
• one of the group companies has begun to carry out its main activities in the Russian Federation, while companies closely associated with it carry out preparatory and auxiliary activities;
• one company of the group began agreeing on the terms of contracts with Russian counterparties, which are binding for another company of the group.

We protect ourselves from tax claims

First, the company needs to prepare a security file that will collect evidence that the activities of a foreign organization do not lead to the formation of a permanent establishment in the Russian Federation.

If you cannot defend yourself against the claims, then it is better to recognize the formation of a permanent establishment and pay additional income tax and penalties. This will avoid a penalty or allowance to be made in the financial statements in respect of the contingent tax liability.

List of basic control questions to check the counterparty

In the process of searching and checking counterparties, it is recommended to use the advice of the Federal Tax Service from letters. For example, the Letter of the Federal Tax Service of the Russian Federation dated July 13, 2017 No. ED-4-2/ [email protected] contains control questions about the integrity of counterparties , which tax authorities use when checking:

• Do you personally know the head of the counterparty organization, under what circumstances, when did you meet?
• What relationships (friendships, business) unite you?
• What work (services) did the counterparty organization perform for you, what goods did it supply?
• Has this organization previously provided similar services for you, performed work, or supplied goods?
• What actions did you take to establish the business reputation of the counterparty organization?

Effective methods of searching and checking counterparties allow you to obtain reliable information about agreements and contracts, as well as legal proceedings, avoid blocking your own accounts due to transfers to unscrupulous companies, and prevent participation in dubious transactions.

Risk No. 10. Reclassification of intragroup services into joint-stock activities

What awaits the company in this case?

Denial of the right to deduct expenses for intragroup services for income tax purposes, additional assessment of income tax, as well as fines and penalties.

What do tax authorities pay attention to?

The company should analyze the following situations:

1. Do intragroup services include those that fall within the definition of “shareholder” activities (that is, those that are authorized by the parent holding company and are based on the shareholders' need to control their investments)?
2. Does the subsidiary receive economic benefits from each intercompany service purchased?
3. Would the company purchase such services from third parties or perform similar functions independently if it were not part of a group of companies?

Eliminating risks

The main thing is to review the terms of agreements for the provision of intragroup services and supporting documents for them, excluding services that can be qualified as “joint-stock” activities.

To do this, you need to collect documents confirming that the expenses accepted for deduction by the Russian company are:

• economically justified;
• aimed at generating income;
• are not related to shareholder activities.

If a company has expenses for services that relate to shareholder activities, then they should not be deducted for profit tax purposes.

If necessary, you should make corrections to your tax reporting , pay additional income tax and penalties to avoid a fine.

Going forward, the company should make a provision in its financial statements for the contingent tax liability.

Download the table on tax risks and methods for minimizing them.

Free services for checking counterparties on the Federal Tax Service website

The official website of the Federal Tax Service of the Russian Federation offers entrepreneurs several services where they can check counterparties.

The simplest among them is a search by TIN. Select the “Legal Entity” tab and enter the TIN or OGRN, or indicate the name and region of location. To obtain information about individual entrepreneurs or farms (peasant farms), you must select the tab labeled “Individual entrepreneur/peasant farm”, and then enter the TIN or OGRNIP, or full name and region of residence.

In addition, on the official website of the Federal Tax Service you can find information about counterparties of interest using the name of the organization, location and other additional criteria.

Article 102 of the Tax Code of the Russian Federation, dedicated to tax secrecy, states that information about an organization can be open to outsiders only with its consent. After Federal Law No. 134-FZ of May 1, 2016 came into force, the list of information that does not fall under the definition of tax secrecy expanded significantly:

• expenses and income of the counterparty during one calendar year
• taxes and fees
• average number of employees
• existing tax violations
• fines, debts and penalties

Risk No. 12. Unreasonably high bonuses for staff and management

What will be the consequences of failure to eliminate it?

The tax office does not recognize bonuses as an expense and will charge additional income tax.

How to determine this risk

If you pay large bonuses to employees or top management, answer the questions below:

1. Does the size of the bonus depend on the performance of a particular employee?
2. Are bonus documents prepared?
3. Is there evidence of the quality work of the rewarded employee?

If you answered all or some of the questions “no”, the tax office may find fault with the premiums paid.

How to fix the situation

First, make adjustments to the documentation establishing the amount of the bonus, in terms of the need for the employee to achieve certain results in order to receive its payment.

If any bonus documents have not been completed, complete them.

To protect yourself from tax claims, collect documents, photos or videos that prove the quality of work performed by rewarded employees.

Risk No. 13. Risk of taking into account “other people’s” expenses (Cost Sharing)

What awaits the company for accounting for payments for third parties in expenses?

Tax bases for income tax and VAT will be recalculated if transaction costs were paid by one person from a group of companies in favor of another.

How to avoid tax claims: if in your group of companies the expenses of one organization are paid from the account of another, the accountant needs to check whether these expenses were taken into account when calculating taxes.

We minimize risks

1. We prepare a documentary justification for reimbursement of expenses incurred by the company in whose favor the goods were received or services were provided (for example, an order to pay for goods under certain conditions).
2. We enter into an appropriate agreement providing for monetary compensation (return of funds to the person who made the payment, preferably with interest).
3. We make payments to the company that paid the expenses of another legal entity in order to confirm the execution of the agreement providing for monetary compensation.

Risk No. 14. Refusal to deduct VAT in the absence of separate accounting

Refusal to deduct VAT (in the part that falls on transactions not subject to this tax) will lead to the accrual of tax arrears.

How can an accountant identify this risk?

Initially, determine whether all company transactions are subject to VAT. If you have transactions that are not subject to VAT and exceed the threshold of 5% of total turnover , be sure to start keeping separate records.

Taxpayers often forget about the need to account for income when selling securities.

It is possible to avoid responsibility. To do this, it is necessary to organize the maintenance of separate accounting from the moment the obligation to maintain separate accounting arises.

Even if exceeding the 5% threshold was violated a long time ago, you can still avoid a fine. The company needs:

• make adjustments to the accounting of past periods;
• recalculate tax liabilities;
• pay taxes and penalties.

Risk No. 15. Refusal to accept part of expenses in the absence of separate accounting

If a company does not keep separate records for goods with different income tax rates, tax authorities on income that is taxed at a rate of 20% will not take into account the costs associated with obtaining income taxed at other rates.

What is the error

If part of your income is taxed at 20%, and part at rates of 30%, 15%, 13%, 10%, 9% and 0%, check that there is a separate accounting of income and expenses incurred to obtain these incomes.

Eliminating risks

If your organization conducts types of activities for which the tax base is calculated in a special basket (for example, transactions with non-negotiable securities and wired financial instruments), then expenses for such types of activities cannot be used to reduce the overall income tax base. Accounting for expenses in this case should be separate.

Risk No. 16. Refusal to apply tax benefits

What awaits the company in this case?

Additional tax assessment as a result of refusal to apply tax benefits.

What to pay attention to

Check with your internal specialists (lawyer or accountant) to see if any tax benefits were applied during the period under review. If so, there is potentially a risk that the tax authority will refuse to apply them.

To identify such a risk, it is necessary to find out whether the organization complied with the conditions provided for by tax legislation for the application of tax benefits.

Additionally, you can analyze current judicial practice on disputes related to refusals by tax authorities to apply tax preferences, taking into account the region and type of benefits applied. This analysis will identify problem areas in the company’s accounting for tax benefits, as well as the tax authorities’ arguments when refusing to apply them.

If you identify violations in terms of the organization’s compliance with the conditions for applying tax benefits, you must eliminate them in a timely manner. If it is impossible to eliminate it, it is advisable to refuse to apply the benefit in order to avoid potential additional charges, penalties and fines.

Tax risk management

The tax risk management process involves:

• organizing work only with trusted counterparties;
• following rules that do not go beyond the current legislation in matters of determining tax bases and total amounts of tax payments;
• compliance with digital indicators considered acceptable by the tax authority for a tax/expense of a certain type;
• systematic analysis of business results and its tax consequences.

A taxpayer who doubts the possibility of accepting the results of any transactions for tax accounting is recommended to exclude them from tax calculations (clause 12 of Appendix No. 2 to the order of the Federal Tax Service of Russia No. MM-3-06 / [email protected] ). If such transactions were taken into account when preparing tax reporting, this reporting should be clarified, accompanied by an explanatory note. Such actions will reduce the risk of conducting an on-site tax audit.