In current realities, conducting an on-site audit as a form of tax control is a real scourge of small businesses. After all, such a measure on the part of the Federal Tax Service in 80% of cases threatens with serious fines. And monetary compensation is not the worst thing that can happen to a company.
And the reason for such a high percentage of sanctions lies in the fact that managers simply do not know how to properly prepare for it. And the fact is that most people simply do not have a clear idea of what this event entails and what algorithms it uses. The powers of the inspection staff and the procedure for carrying out the procedure are unclear. And in some cases, even the purpose of the event remains very vague for the entrepreneur. Although it would seem that it is simpler. The object should always be potential evasion of payments, distortion of documents and concealment of unspecified inventory items. But, as practice shows, the moment is not always correct.
In this review we will look at all aspects of the process.
What it is
So, on-site tax audits can be carried out in relation to completely different legal entities. But if you look at the statistics, simplified individual entrepreneurs are the most realistic candidates. Why is this happening? Yes, first of all, the fact is that there are simply more such companies than full-fledged LLCs, OJSCs or CJSCs. And every entrepreneur, given the conditions, will always try to switch to the simplified tax system, because it is simply profitable. And even if not all requirements are met, the manager often strives for this system. This is the second aspect, checking the legality of this peculiar transition.
As for the concept itself, there is no clear definition recorded in the Tax Code of the Russian Federation. But it can be removed without any problems. Such formats, unlike their office counterpart, are always of a special nature. That is, this is not an ordinary process that takes place at the end of each reporting period, month or year. No, such research has not been systematically carried out since 2022, not counting some enterprises operating in the healthcare or social sphere.
Therefore, since this is not a typical case, it requires adequate and compelling reasons. That’s right, an on-site tax audit is carried out on the basis of already identified violations or suspicions of their presence. If you have received increased attention from the Federal Tax Service, you receive a kind of tick in the personal file of the enterprise. And if enough of them accumulate, then the arrival of the tax authorities will not take long. It is also worth understanding that even one major violation is quite capable of triggering the arrival of employees. Usually suspicions arise during a desk procedure. If there are obvious errors, then the reporting is simply returned to the taxpayer. And he must correct it in a timely manner. The period is only 5 days. But if suspicions arise that potential evasion is taking place, but this cannot be directly tracked in the declaration, a departure is scheduled. Circumstantial evidence is sufficient for this.
Accordingly, we understand what the appointment procedure and regulations for conducting an on-site tax audit are. This is a specific algorithm for collecting evidence, assessing their quantity and weight. Unfortunately, exact data on the indicated points is unknown. Everything depends on the decision of the head of the department of the Federal Tax Service at the place of registration of the organization. In some cases, one package of evidence may be considered sufficient, but in another it may not. Therefore, you should not strictly focus on this. It is better to always keep in mind that “guests” can knock on the door literally at any moment. At least, this is relevant after submitting reports for the period. Its study takes up to three calendar months. And at this time it is best to be especially vigilant.
As for the definition, the procedure is characterized by the following aspects:
- Conducted on site.
- Lasts from 1 day to 2 months.
- Employees have special powers and will have to provide any primary documents upon request, as well as property owned by the enterprise, if available. And free passage through any premises, including warehouses, archives, laboratories and other areas.
- The basis for the decision to conduct an on-site tax audit is an order from the head of the department of the Federal Tax Service.
- According to Art. 89 of the Tax Code, the total duration of the event cannot be later than 3 years after the order. Standard limitation period.
Tax audit results - a certificate in the KND form 1165010 and a GNP report in the KND form 1160098
The on-site tax audit is completed by drawing up a certificate in the form of KND 1165010. The document reflects the subject of the analysis and the timing of control activities. The certificate is handed over to the taxpayer or his representative on the last day of the audit. The date the document was drawn up is the day the tax inspector ends his work.
The certificate is also required to indicate the initial date for making a final decision on the inspection. Practical activities are not the last stage of the tax inspectorate’s work; then it is necessary to analyze the information received and draw up a final document. A separate amount of time is allocated for this.
In accordance with Art. 100 of the Tax Code of the Russian Federation, the results are recorded in the on-site inspection report in the KND form 1160098. 2 months are allotted for its execution from the date the taxpayer receives the certificate.
Such an on-site tax audit document is drawn up under any circumstances, regardless of whether violations are identified or not.
The act, in accordance with the provisions of the law, must include a number of mandatory information, which include:
- the date of drawing up the act, which is considered the day the document is signed by all authorized persons;
- full and abbreviated name of the organization, as well as its division, if the audit is aimed at its activities;
- the position and full name of the person authorized to conduct the inspection, as well as the name of the body whose head initiated it;
- date and number of the decision of the head of the relevant tax authority to order an audit;
- a list of documents received by the taxpayer, as well as those presented by the inspector during control activities;
- deadline, exact start and end dates of the inspection;
- subject - type of taxes subject to audit;
- address of the location of the company being inspected;
- a list of procedures implemented within the framework of a specific inspection;
- documents confirming facts of violations, if any have been identified;
- conclusions, proposals and recommendations of the official based on the results of the inspection, deadlines for eliminating deficiencies.
The act must be accompanied by documents confirming the violation of the law. At the same time, the documents previously provided by the taxpayer are not an attachment to it.
When it comes to information that constitutes state, tax, or commercial secrets, they must be attached to the act only in the form of extracts certified by the Federal Tax Service.
The taxpayer can file objections to the act, give explanations regarding the recommendations and proposals of the employee of the Federal Tax Service of Russia. This can be done no later than 15 working days from the date of receipt of the document.
Species diversity
Despite the fact that there is no clear concept in the Tax Code of the Russian Federation, this study is still divided into several types. Let's look at each of them.
- Specific. Only one transaction is affected. And this is the safest option for the organization itself. Tax officers will not be interested in all taxable activities, but only in the selected agreement. It is here, according to employees, that the violations are hidden. And in any case, even if it really exists, it’s not so scary. The most unpleasant thing, besides the standard fine, is the potential cancellation. But what’s interesting is that usually the attention of the Federal Tax Service in this case is not the organization itself being inspected, but the counterparty. Simply uploading information through the second party is easier, safer and faster. How to work with the potential accused himself.
- Selective. This is already more unpleasant. Such an on-site tax audit can cover entire verticals and layers of activity. Usually one is selected. Relevant for companies that operate in several areas at once. Conveniently, other industries are not suffering at all at the time of the event and are not suspending their activities. But the research will be very meticulous in any case. And despite the fact that the request will concern one vertical, be prepared to provide tax authorities with access to any location. Even to warehouses that are practically not connected with this area.
- General. The most unpleasant, protracted and painful option for the company. And what’s most annoying is that it is prescribed with considerable frequency. After all, for a selective analogue you need to at least have clear suspicions about a specific industry. But they are not always there. So you have to go through the entire company as a whole to catch where exactly the violation is hidden. And as often happens, instead of the one that was suspected, there are dozens of new ones. Considering how an on-site audit takes place, what the tax inspectorate checks during an on-site audit, they will be able to get to the bottom of all the “gray” points of the enterprise. All primary documentation is reviewed and supply agreements are fully analyzed. Even accounting entries, cash registers and accounting journals are considered. They can easily check the warehouse for compliance with the real component of the inventory and their documentary reflection.
In connection with the latter, it is always worth having high-quality software that allows you to carry out this kind of reconciliation in a timely manner.
can help with this. Thanks to special software, inventory is carried out by just one employee. And for this you don’t need any additional equipment, just a smartphone. Software from Cleverence is:
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- Program developed to meet modern requirements of Russian legislation.
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Grounds for conducting an on-site tax audit
As we have already noted, there is always a reason. The procedure is not systematic. This means that there are a number of legitimate claims with the help of which the decision to order this study is made. VPN is often prescribed if there are suspicions of corrections or inaccuracies in the data reflected in the declaration. This is the most common case. Plus, the timing of the transfer also plays a role. If the reporting arrived significantly late, this is also a kind of alarm bell.
If before this the company already had difficulties with paying contributions to the budget of the Russian Federation, certain sanctions from the Federal Tax Service have already accumulated - this is an additional point in favor of the VPN. No less important is the organizational status of the company. If the taxpayer's system has recently been changed to one of the simplified forms, there will also be close attention. Moreover, employees may simply want to check whether the transition conditions have actually been met.
But, considering what documents the tax authorities check during an on-site tax audit, they still need permitting documentation signed personally by the head of the department. Therefore, a fictitious and vague reason will not work. If the arriving Federal Tax Service employees do not support their requests with warrants, then you can ignore them. And you will definitely know the reason indicated, recorded, signed and stamped.
Procedure and rules for conducting GNP
Legislative norms determine not only the duration and frequency of on-site tax audits, but also establish regulations for its implementation. The basis is the decision made by the inspectorate in which the subject is registered. The content should include information about the planned event, including the composition of the audit team, as well as specific fees and period that require clarification. At the same time, the Code does not establish an obligation to deliver a copy of the document to the taxpayer, although in practice the form contains a similar section and is usually provided before the start of the procedure.
During the audit, responsible inspectors send requirements, seize and inspect various types of materials, order expert studies and conduct interrogations of employees, as well as perform other actions necessary to achieve the result. The composition of the participants can be changed, but only if the corresponding entries are made in the content of the decision. On the final day, a documentary certificate is drawn up, reflecting the subject and timing of the tax inspection, and handed over to the taxpayer.
Procedure
Again, there are no strict regulations. Yes, there are some elements that apply in one situation or another. But which ones will be involved in your case depends on the suspicion and severity of potential violations, the scope of their occurrence and many other factors.
Nevertheless, the procedure for conducting an on-site tax audit is formalized only by legal means. Therefore, after each action, a report will be drawn up. And they can be as follows:
- Visual inspection of premises. And you should not interfere with gaining access to any rooms or buildings. Even if it's the director's office. Nevertheless, from this perspective, the Federal Tax Service has legal requirements for unhindered movement throughout the territory.
- Inventory. That's why we emphasized the importance of this point in the preliminary stage and the need for software that simplifies this process. Tax officials will be as closely as possible during their work. Therefore, if the commission conducting the inventory before this took a careless approach to the work, at this stage the whole truth will be revealed.
- Request and seizure of documents. That is, documentation may be required to be presented on the spot. And take it with you for further study, if right now it is not possible to identify the presence or absence of errors and falsification.
- Expertise. For this task, independent experts from various fields and levels are involved. Remember that you do not pay for their activities, even if it turns out that violations actually took place. And you are completely free to watch them work. It is your right to be present during an on-site tax audit.
- Interrogation. Persons who are employees of the company, as well as third parties with information, give testimony. According to the law, you cannot be forced to do this. But remember that refusal to provide information may become a reason for going to court. And during the legal proceedings it will no longer be possible to refuse.
Results of the procedure, final acts
Upon completion of the collection of information and evidence, identification and analysis of all accompanying documentation, epilogues become a special act. Its form is KND 1165010. In fact, it is a kind of confirmation that the procedure was successfully completed. It is transferred to the manager or owner of the company. And it also indicates the subject of the research. And this is very important. According to the law, it is impossible to make a claim in any industry or transaction if the VPN has already passed through it. This is a kind of shield, unless, of course, violations are revealed.
After transmitting the document, all information received will be carefully analyzed. And the result will be another act - KND 1160098. It will tell you whether mistakes were made, whether there are deviations from the norms, whether sanctions will be applied. Its preparation takes time, but no more than 2 months.
Appeal
If you do not agree with the result, no one cancels the right to file a complaint against the actions of employees. To do this, you need to contact the higher authority of the Federal Tax Service directly. The form is free, but do not forget to attach the document you receive.
It is also of interest how often on-site tax audits can be carried out. And wouldn’t it be a violation on the part of the service to have too systematic a VPN? Actually the answer is simple. The frequency depends only on the presence of legal reasons on the basis of which the head of the department makes a decision. That is, at least every reporting period. Or basically never.
By the way, if your complaint is not successful, this is not a reason to despair. You still have the right to protect your legitimate interests through legal proceedings. Therefore, feel free to go to court if you are sure that the Federal Tax Service has exceeded its powers or made a mistake.
What documents may be requested?
To obtain the necessary information, the tax office sends a request “to provide documents (information).” Within 10 days you must provide the documents listed in the request. Copies certified by the manager are provided, and each copy must be certified. The legislation also provides for the possibility of sending documents electronically via TKS.
The list of documents that may be requested is not defined by law. Tax officials are interested in everything that can be used to confirm business transactions with a counterparty, first of all: contracts, invoices, acts, invoices.
The list of documents may be large, and if you feel that you will not have time to provide them in such a short time, then the next day send a letter to the tax office indicating the reason for the delay and the deadline for submission. Within 2 business days you should receive a decision on whether to extend the deadline or to refuse to extend it.
It may turn out that you do not have the requested documents at all, then in response to the request you also need to send a letter to the tax office within 10 days.
You and your counterparty may be members of different tax authorities. In this case, the “foreign” tax office cannot demand information from you. The counterparty's Federal Tax Service sends an order to your inspection, and yours, based on this document, sends you a request and a copy of this order.
The results of the counter-inspection are documented in a document.
Responsibility for violation
Depending on the severity of the offense, various consequences may occur. First of all, the tax office, the usual fines, sanctions; in case of delay, a penalty is also charged. For violations that are related to specific decisions of officials - administrative. But in fact, it also represents fines. But not to the enterprise as a whole, but to the individual. Remember that an on-site tax audit may be carried out to look for criminal offenses. And this is the most unpleasant case. If crimes are detected, the accused faces a real prison sentence.
Characteristic violations
It is impossible to accurately determine the list of violations that may be detected during an inspection at the company’s location. However, the practice that has developed over many years, the analysis of materials, the established facts of prosecution - all this allows us to consider several of the most common examples:
- Understatement of the tax base.
This violation manifests itself in various ways. The taxpayer may hide part of the proceeds from sales or credit debt or unreasonably reduce the value of the alienated property if such a transaction is gratuitous. In most cases, these violations relate to corporate income tax, VAT and personal income tax.
- Concealment of income for the purpose of evading personal income tax.
Income tax is the subject of most violations. Common options include illegal actions when calculating and paying personal income tax on wages, as well as when selling property, if we are talking about individuals.
- Inflated expenses.
Here we are talking about an attempt to reduce the amount of income tax, which is calculated by deducting expenses from the income received. The smaller this difference, the lower the tax. In this case, the actual profit received is concealed.
- Incorrect application of the simplified tax system.
Here the rules regarding the maximum amount of income are also violated, the achievement of which does not allow the entrepreneur to pay taxes under this preferential regime at a reduced rate.
- Failure to submit documents to the tax authority.
We are talking about declarations, responses to requests, explanations and other information that must be submitted to the Federal Tax Service. Such actions may also be considered an offence.
A complete consolidated list of typical violations that are identified through on-site inspections can be found on the Shmeleva and Partners website.
You can download and view the documents using the links:
- Typical violations of the legislation on taxes and fees identified during tax audits, the decisions based on the results of which came into force in 2014-2016, taking into account those formulated in the courts
- Typical violations of the legislation on taxes and fees identified during tax audits, decisions based on the results of which came into force in 2022, taking into account the legal positions formulated in judicial acts
Ready-made solutions for all areas
Stores
Mobility, accuracy and speed of counting goods on the sales floor and in the warehouse will allow you not to lose days of sales during inventory and when receiving goods.
To learn more
Warehouses
Speed up your warehouse employees' work with mobile automation. Eliminate errors in receiving, shipping, inventory and movement of goods forever.
To learn more
Marking
Mandatory labeling of goods is an opportunity for each organization to 100% exclude the acceptance of counterfeit goods into its warehouse and track the supply chain from the manufacturer.
To learn more
E-commerce
Speed, accuracy of acceptance and shipment of goods in the warehouse is the cornerstone in the E-commerce business. Start using modern, more efficient mobile tools.
To learn more
Institutions
Increase the accuracy of accounting for the organization’s property, the level of control over the safety and movement of each item. Mobile accounting will reduce the likelihood of theft and natural losses.
To learn more
Production
Increase the efficiency of your manufacturing enterprise by introducing mobile automation for inventory accounting.
To learn more
RFID
The first ready-made solution in Russia for tracking goods using RFID tags at each stage of the supply chain.
To learn more
EGAIS
Eliminate errors in comparing and reading excise duty stamps for alcoholic beverages using mobile accounting tools.
To learn more
Certification for partners
Obtaining certified Cleverence partner status will allow your company to reach a new level of problem solving at your clients’ enterprises.
To learn more
Inventory
Use modern mobile tools to carry out product inventory. Increase the speed and accuracy of your business process.
To learn more
Mobile automation
Use modern mobile tools to account for goods and fixed assets in your enterprise. Completely abandon accounting “on paper”.
Learn more Show all automation solutions
Preparation and passing of VPN
Remember a few tips to minimize your risk:
- Always prepare and send reports to the Federal Tax Service on time.
- Don't raise your bid above the market average.
- Try to keep all accounting documents in order.
- Do not interfere with the activities of the Federal Tax Service.
- Do not try to switch to the simplified tax system if the conditions are not met.
- Report income and expenses in a timely manner.
And most importantly, study and understand what the methodology for conducting an on-site audit by the tax inspectorate is.
Then you will know exactly what actions from the tax authorities threaten you. Number of impressions: 1026
Response time
If the request is sent as part of a tax audit, then you must respond within 5 days from the date of receipt.
If outside the scope of a tax audit - 10 days.
If it is clear from the request that these deadlines cannot be met, then within 1 day from the date of receipt it is necessary to submit a response to the Federal Tax Service with a request to extend the deadlines and indicate the reasons why the organization does not have time to provide documents on time or you can indicate the period within which information will be provided.
For this reason, it is important, immediately after receiving a request, to assess the extent of the data collection work to fulfill the tax authority’s request.
