Tax audit – is an audit realized by tax bodies, execution of RK tax legislation. Participants of tax audits are official persons of tax bodies indicated in regulation, other persons involved in audit conduction according to Tax Code and taxpayer.
Types and terms of tax audits conduction
Tax audits are divided into following types:
- Tax audit carried out in a special order based on risk assessment.
- Unscheduled tax audit.
Terms of tax audits:
A tax inspection term should not exceed 30 working days from the date of notice delivery.
Tax inspection term can be extended in the following cases:
- For legal entities not having structural units, individual entrepreneurs and non-residents performing activities via permanent establishments upon availability of no more than one registered office in RK the term can be extended by a tax authority which initiated tax inspection up to 45 working days, while a higher tax authority can extend the term for up to 60 working days;
- For legal entities not having structural units and non-residents performing activities via permanent establishments upon availability of no more than one registered office in RK, and also for taxpayers subject to monitoring:
- term can be extended by a tax authority which initiated tax inspection up to 75 working days;
- higher tax authority can extend the term for up to 180 working days.
No less than thirty days prior to tax inspection executed under special procedure based on risk assessment, a tax authority sends or delivers a notice on execution of tax inspection to a taxpayer (revenue agent).
A notice is sent or delivered to a taxpayer at a place indicated in registration data. A notice sent as registered letter is deemed to be delivered on the date of mail service response.
The notice contains a tax inspection form, the list of issues subject to inspection, preliminary list of required documents, a taxpayer`s rights and liabilities, and also other data required to conduct a tax inspection.
A tax authority has a right to start a tax inspection without noticing a taxpayer on an inspection in cases when there is a justified risk that a taxpayer can hide or destroy documents required for an inspection related to taxation or there are other proves that make an inspection impossible or that do not allow conducting it to the full extent.
Grounding to conduct a tax inspection
Pursuant to Article 148 of the Tax Code, grounding to conduct a tax inspection is a notice containing the following details:
- date of a notice registration in a tax authority and its number;
- name of a tax authority that issued a notice;
- surname, name, patronymic (if indicated in an ID document) or full name of a taxpayer (revenue agent);
- identification number;
- inspection form and type;
- surnames, names, patronymics (if indicated in an ID document) of auditors, and also those of engaged specialists;
- an inspection term;
- an inspected period, except for timeline inspection.
Only one tax inspection can be conducted under one notice, except for topic-specific inspections on the following topics:
- registration in tax authorities;
- availability of cash registers;
- availability of equipment (device) intended for acceptance of payments made by plastic cards;
- availability and authenticity of excise and monitoring stamps; availability and authenticity of dispatch notes for alcohol products, oil products and biofuel; availability of license;
- availability of consignment notes for imported goods and compliance of goods names with those indicated in consignment notes during vehicle inspections on transport control or traffic police posts.
Commencement of tax inspection
Commencement of tax inspection is the date of notice delivery to a taxpayer or the date of act drawing-up on a taxpayer`s refusal to sign a notice.
When conducting topic-specific inspections on the following topics: registration in tax authorities; availability of cash registers; availability of equipment (device) intended for acceptance of payments made by plastic cards; availability and authenticity of excise and monitoring stamps; availability and authenticity of dispatch notes for alcohol products, oil products and biofuel; availability of license, an original copy of a notice is demonstrated to a taxpayer or an employee selling goods or delivering services for familiarization and its copy is provided. A taxpayer or an employee selling goods or delivering services signs an original copy upon familiarization and obtaining of copy and fills in a date and time of a notice copy obtainment.
If a taxpayer refuses to sign a notice, a tax authority employee draws up an act on refusal to sign a notice engaging witnesses. Thus, the following is indicated in the act on refusal:
- Place and date of issuance.
- Surname, name, patronymic (if indicated in an ID document) of a tax authority`s public official who drawn up an act.
- Surnames, names, patronymics (if indicated in an ID document), ID document numbers, places of residence of witnesses.
- Date of notice, its number, name of a taxpayer (revenue agent), his/her identification number.
- Circumstances of refusal to sign a notice.
Refusal of a taxpayer (revenue agent) to obtain a notice on tax inspection is not a grounding to cancel a tax inspection.
Refusal of a taxpayer to sign a copy of notice belonging to a tax authority means non-admission of a tax authority public officials to a tax inspection.
A taxpayer should admit a tax authority`s public officials to the territory and into premises (except for residential premises) used for income generation or to taxation items or items related to taxation for inspection.
A tax authority`s public officials should have special access permits, if there are required to be admitted to a taxpayer`s territory and/or premise pursuant to the legislative acts of RK.
A taxpayer has a right not to admit a tax authority`s public officials to the territory or into premises to conduct a tax inspection, if:
- a notice is not drawn up according to an established procedure;
- an inspection terms indicated in a notice have not come yet or expired;
- the individuals are not indicated in a notice;
- a tax authority`s public officials do not have access permits required to be admitted to a taxpayer`s territory and/or premise pursuant to the legislative acts of RK.
Completion of tax inspection
Upon completion of tax inspection, a tax authority`s public official draws up a tax inspection act indicating:
- place of tax inspection execution, date of act execution;
- inspection type and form;
- positions, surnames, names, patronymics (if indicated in an ID document) of a tax authority`s public officials who conducted a tax inspection;
- a tax authority`s name;
- surname, name, patronymic (if indicated in an ID document) or full name of a taxpayer (revenue agent);
- location and bank details of a taxpayer (revenue agent), and also his/her identification numbers;
- surnames, names, patronymics (if indicated in an ID document) of a taxpayer`s (revenue agent`s) head and public officials responsible for tax and accounting reports as well as payment of taxes and other statutory charges to the budget;
- information on previous inspection and measures taken to eliminate violations of the tax legislation of the Republic of Kazakhstan identified earlier (during execution of comprehensive/topic-specific inspections);
- inspected period and general information on documents provided by a taxpayer (revenue agent) for inspection;
- detailed description of a tax violation with reference to a relevant provision of tax legislation of the Republic of Kazakhstan;
- an inspection results.
Completion of tax inspection is the date of tax inspection act provision to a taxpayer.
When obtaining a tax inspection act, a taxpayer should sign it in a copy belonging to a tax authority.
If it is impossible to deliver an act to a taxpayer due to his/her absence at the location, a tax inquiry is carried out with the involvement of witnesses under procedure established by the Tax Code. In this case, the date of tax inspection completion is the date of drawing up an act of tax inquiry.
If no violations of the tax legislation of the Republic of Kazakhstan are identified upon completion of a tax inspection, relevant entry is made about this in a tax inspection act. The required copies of documents and calculations made by a tax authority`s public official as well as other materials are enclosed to a tax inspection act.
