Roche & Cie

Tax Control 2.0: What’s new in 2017?

07 Feb 2017

The French administration strengthens its fight against tax fraud and modernises its control procedures in the field of business accounting.

Two new measures applicable since 1 January 2017 are to be noted: the procedure for examining remote accounting and the new procedures for the tax audit of computerized accounts.

Let’s have a glance on the new remote control procedure: the accounting review …

New fiscal control procedures introduced!

The control of computerized accounts is intensifying. In addition, a specific procedure for on-the-spot checking of applications for refund of VAT credits is created.

Control of CEE

The tax administration can now remotely control the accounting entry files (FEC). A procedure, referred to as an “accounting examination” (not “audit”), has been in place since 31 December 2016.

This procedure begins with sending the company a notice of accounting review. Once this notice has been received, the company has 15 days to transmit to the administration a copy of the FEC in dematerialized form, meeting the standards in force. If it fails to comply with this deadline or the terms of transmission, the company is liable to a fine of € 5,000.

Subsequently, the administration can, from the transmitted files, carry out sorts, rankings and calculations, in order to verify their consistency with the tax returns of the company. If it finds errors, it shall send it a proposal for rectification. On the other hand, if it finds no anomaly, it informs the company of the absence of rectification. For this, it has 6 months after receiving the files. For its part, the company benefits from the guarantees of the “Audited Taxpayer’s Charter”, and in particular the possibility of seizing the supervisor’s supervisor.

Refunds of VAT credits

A new procedure specific to applications for refund of VAT credits is introduced for applications filed since 1 January 2017. It allows the administration to check the merits of the application without triggering an accounting verification. This procedure, which consists of an on-the-spot check, begins with the sending of an instruction to the company on the spot. Only tax agents with at least the rank of controller who can intervene at the company’s premises from 8 am to 8 pm and during working hours. In this context, they may collect information and justifications, make physical findings or consult the books, accounting documents and supporting documents relating to the application and take copies of the documents known to them during their intervention. The administration is then obliged to reply within 60 days of its first intervention on the spot and 4 months after notification of the notice of inquiry. Failing that, it shall be deemed to have accepted the application for reimbursement.

Opposition to copies of documents

Up to now, the company which objected to the copying of documents consultable by the auditor involved in the context of an accounting audit incurred a fine of € 1,500 per document concerned, up to a maximum of € 10,000 . This limit is raised to € 50,000 for breaches found as from 1 January 2017.

Source: Les Echos