Guidelines for planning and approval of monthly tax audit plan
The audit plan should reflect the needs presented in the Large Taxpayer Office. The heads of offices should send their proposals in writing to the Head of Audit Section, before the latter starts preparing the audit plan for the following month. In order to make sure that the planning is correct and that taxpayers to audit are correctly included in the plan, it is necessary to also have proposals from the head of the assessment and collection section as well as from the head of enforcement and debt management, so that this cooperation will serve to clarify certain issues, such as, data keeping methodology, especially in cases when taxpayer’s data are incomplete. Information is also received from the official in charge of Appeal Administration, for cases when the taxpayer to be planned for audit is under appeal procedures.
The audit plan is prepared by the Head of Audit Section on the 25th of the preceding month and is presented to the Head of Large Taxpayers Office. After the latter has received approval from the Head of Tax Audit Directorate in tax agency, this plan should be approved no later than the first day of the planned month, but the plan should be available for the Tax Audit Directorate at least two days before the end of the month. If there is no answer until the 1st of the month, Large Taxpayers Office can consider the audit plan for the month in question as accepted by Tax Audit Directorate.
Using the audit selection methodology (IT or manual program) the plan should include the taxpayers to be audited as well as the number of days to be spent for each tax audit. Tax Audit Directorate can change the already selected taxpayers, but it cannot change more than 15% of the total number of taxpayers selected by the audit section, neither can it change the taxpayers that have been selected by the IT system, if such system is in use. In such case the Tax Audit Directorate can add other taxpayers for audit and they should be part of the 15% of manually selected taxpayers together with the selections made by the selection system.
Deadlines applicable in planning audits for special requests
The practice adopted so far has shown that continuous audits to large taxpayers have hidden their factual tax obligation, and consequently, large businesses in general represent the larger risk area for hiding tax revenues. On the audit planning process, the head of audit section should assess the risk for potential fraud. Thus, in case fraud is discovered, the audit plan should include the necessary techniques to be used.
Cases of refunding requests
The Assessment Section provided the Head of Audit Section with the list of persons that have requested refund. This list is sent via internal protocol of Large Taxpayers Office. In the meeting with the heads of offices, the Head of Section plans the fiscal visit for the closest day possible in order to check the accuracy of each request included in the list. At the end of such check after the fiscal visit, this sector specifies the sum agreed for refund in the report written for this purpose. A copy of the fiscal visit report is sent to the Assessment and Collection Section via internal protocol. The deadline for sending this information should not exceed 25 days from the date the refunding request was registered in the respective register.
Cases of taxpayers’ requests for deregistration, bankruptcy or change of status
The Assessment and Collection Section, Enforcement and Debt Management Section or Head of Large Taxpayers Office directly provide the Audit Section with the list of persons that have requested deregistration or bankruptcy procedures. This is done via Large Taxpayers Office internal protocol. In the meeting with the heads of offices, the Head of Section plans the fiscal visit to check the requests, not exceeding the 30-day deadline from the moment the request was registered in Large Taxpayers Office.
Cases of requests for audits coming from headquarter of tax agency
In such cases, after receiving a request for conducting an audit, the head of section will plan the audit to be conducted in the following month, unless the request has the note “Urgent” on it. If the official document authorizing the audits contains a long list of taxpayers, the Head of Section contacts the Tax Audit Directorate (TAD) in order to prepare an audit plan according to the list.
In all audits requested from Tax Audit Directorate, it appoints one of its officials as supervisor to monitor the observance of audit procedures, legal provisions and TAD orientations. In special moments during the audit (misunderstanding between auditor and taxpayer, non-ethical or non-professional behavior by auditor/s), the supervisor can also make final interpretations, sticking to the audit program already prepared by Large Taxpayers Office, in observance of recommendations relevant to the problem to be audited.
Cases of requests for audits coming from taxpayers
After discussing with the heads offices, the Head of Section programs the fiscal visit to check the requests, not exceeding the 30-day deadline from the moment the request was registered in Large Taxpayers Office.
Cases of requests for re-audit
In cases of requests for re-audits coming from taxpayers, tax appeal structures, tax agency or Local Tax Offices, the Large Taxpayers Office can never take a decision for re-audit without an authorization from the Tax Appeal Directorate, Tax Audit Directorate, Internal Audit Directorate or Operational Directorate for Supervision of Local Tax Offices. In every case, directorates not covering the tax audit function should at the same time also inform the Tax Audit Directorate about their request presented to Large Taxpayers Office. In all cases, re-audits will be conducted in compliance with procedural steps specified in pint 5.10 of this Manual and within the 30-day deadline from the moment the request was registered in the Large Taxpayers Office protocol.
Cases of requests for audits coming from other Tax Offices
In such cases, after receiving the request to check or crosscheck data, the head of section plans the audit to be conducted in the following month, not exceeding the 30-day deadline from the date the request was registered in Large Taxpayers Office. If Large Taxpayers Office is overburdened with work, it should answer the Local Tax Office within this period and find the closest possible time to close the request made by Local Tax Offices.
Cases of requests for audits coming from institutions auditing the functioning of tax administration
In such cases, after receiving the request from either such institutions or tax agency (High State Audit, Internal Audit Directorate, tax agency) to check or confirm data from audits conducted by these institutions, the head of section plans the audit to be conducted during the following month, not exceeding the 30-day deadline from the moment the request was registered in Large Taxpayers Office.
In all other cases, for requests specified in the points above and do not violate tax procedures, after discussions with the heads of office, the Head of Section programs the fiscal visit, not exceeding the 30-day deadline from the moment the request was registered in Large Taxpayers Office. If, for objective reasons, this is not possible, the head of section replies, not exceeding the 30-day deadline from the moment the request was registered in Large Taxpayers Office, explaining the reasons for not conducting the audit and announcing it for the closest possible period.