Tax audit

Jan, 17 2024


Professional audit of tax accounting helps to avoid problems with legislation, optimize the tax base and make the company’s operations more efficient. Tax audit is especially needed by companies with a multi-level structure, including holding companies. This service is also popular among firms with an extensive network of branches, medium and small businesses.

It is important to carry out the audit on time, since the overpayment is refunded no more than three years after the operation, so it is important to submit a request to the tax service in a timely manner. Also, a tax audit should be carried out when the head accountant or the specialist responsible for payments and declarations changes.

The main purpose of any tax audit is a qualified review of all financial records of the company for compliance with current legislation. Violations can occur not only due to the fault of full-time accountants, but also due to frequent amendments to tax legislation.

When a tax audit is required

Putting the records in order before the audit eliminates problems with government agencies, it is necessary so that penalties are not imposed. If the company finds surpluses in tax payments or government charges, it can count on a refund. This becomes another factor in favor of regular audit of tax accounting.

In addition, verification is also necessary in the case when the client is going to purchase any other company or part of it. To do this, an assessment is carried out either of all risks or risks in a certain direction of the company that is put up for sale.

Types of tax audit

Preliminary inspections of tax reports are divided into three types:

  • comprehensive inspection;
  • subject-matter;
  • structured.

A comprehensive audit implies a comprehensive audit of all tax records for the year. It requires more time on the part of the contractor and financial costs from the client. A comprehensive tax audit will be required on the eve of a planned audit by the tax service. It also allows you to identify expenses trends and develop a system for optimizing them.

A subject-matter audit is an analysis of a certain type of tax records for a selected period. Such review allows you to go deep into the details of records, to find weaknesses. It is usually carried out much faster than a comprehensive one.

During the structured audit, the declarations are checked separately for each tax that the client pays at the location of the company’s branches. This type of tax audit is best suited for enterprises with an extensive structure. It allows to cover the entire taxation system of an enterprise, compare the tax burden on divisions and balance it.

Express audit services are considered separate from others. This is a quick examination of all tax reports, carried out in a short time. Such a tax audit is resorted to if there is no time for a comprehensive audit, and there is not enough thematic audit, because more information needs to be analyzed.

Methods of conducting tax audit

The audit of tax liabilities is carried out in two stages: first, the existing taxation system is evaluated and the examination of the correctness of tax deductions to the budget and extra-budgetary funds. Verification of tax payments involves the analysis of VAT tax returns, income tax returns, certificates of advance payments, personal income taxes, etc. Based on the results of this stage, conclusions are drawn about the structure of taxation, system shortcomings are corrected, optimization options are proposed.

Tax audit includes:

  • verification of your tax obligations;
  • assessment of the effectiveness of the current method of optimizing the tax base;
  • recommendations on reducing the tax base;
  • preparation for inspections by tax authorities.
Author of the article
Tax audit
Valentina Khlavich
Managing Partner
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