Did you know that anyone can be at risk of a tax audit? The question here is, if it comes to it, are you prepared?
Tax Audits can be a daunting prospect for many. The process is often time-consuming, requiring significant time and resources to gather the necessary documentation and to respond to inquiries. The fear of potential penalties or potential adjustments to tax liabilities adds to the anxiety and pressure of being under “investigation”.
Are you thinking that you are not at risk? Really and truly, everyone is.
Ensuring good practices focused on key areas of risks may mitigate the financial and psychological burden associated with tax inquiries, when and if they arise.
Below we will take a look at some common pitfalls to non-compliance that increase your risk of a tax audit.
- Complex transactions
- Unusual or anomalous deductions
- Are you prepared to face the consequences of incomplete reporting?
- Past non-compliance
- Outdated practices
Complex transactions
Not seeking the right advice at the right time from the right experts comes at a cost. Having access to the right technical knowhow and support can mitigate the risk of discrepancies or under-reporting of tax. Do you have the right practices in place?
Unusual or anomalous deductions
Lacking sufficient and appropriate evidence leaves you defenceless, if challenged. Having an appropriate document retention policy is key.
Are you prepared to face the consequences of incomplete reporting?
A return with incomplete material disclosures shall be considered as never having been filed unless it is complete in all material respects.
Past non-compliance
Performing regular health checks as a means to identify risks of non-compliance and ensuring implementation of timely remedial actions is crucial.
Outdated practices
Outdated practices lead to inefficiencies and heightens the risk of non-compliance. By leveraging on AI to automate routine processes, one can focus on key risk areas and reduce inconsistencies in reporting, ultimately mitigating risks and minimising errors.
It is important that you do the right thing, simply because it is the right thing to do.
How can we help?
We can help you prevent, manage, and resolve tax audits and enquiries. From routine tax enquiries to in-depth tax investigations or assistance in bringing your tax affairs in order, our dedicated tax dispute resolution team can guide you through every step of the process. We are uniquely positioned to give you clear, straight-talking, and solid tax advice to help you achieve the best possible outcome - including helping you avert the problem from occurring in the first place.
We can help on a wide range of tax investigation matters including corporate tax, personal tax, VAT and FSS audits.
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