How likely is it that you or your organization will be audited?
There can be several reasons why you or your organization may face a tax audit, including:
- Random selection – occasionally, audits are randomly conducted to maintain the integrity of the tax system
- Discrepancies in tax returns – inconsistencies or unusual patterns in tax filings may trigger an audit
- Industry-specific factors – certain industries may be more prone to audits due to inherent risk factors
- Previous audit findings – if past audits revealed issues or irregularities, subsequent audits might be more likely.
What do the tax authorities check during a tax audit?
During a tax audit, the tax authorities typically examine:
- The accuracy of the tax returns, ensuring that all reported figures are correct and supported by documentation
- Compliance with tax laws by verifying adherence to relevant tax regulations and laws
- Financial transactions to confirm that they are legitimate and properly recorded
- Supporting documentation to assess the adequacy and completeness of records supporting the taxpayer’s tax filings.
Depending on the applicable tax laws of a given jurisdiction, taxpayers may or may not be required to be present at an interview. It is crucial to understand your rights. Our team will guide you and your organization through this process and ensure that the tax authorities act in a fair, appropriate manner as prescribed by law.
How can Meijburg help you?
In principle, you must always cooperate with a tax audit. However, there are limits to the information that the tax authorities may request. Our specialized tax controversy professionals are able to help you in these difficult situations. Audits can lead to substantial tax adjustments or even penalties. We highly recommend that taxpayers have an authorized representative to assist during a tax audit in order to:
- Confirm that the tax authorities are complying with the applicable tax rules and that your rights will be safeguarded
- Check that the information provided to the tax authorities is classified correctly for tax purposes, as this may reduce tax adjustments or penalties
- Ensure that the right information is sent to the authorities: neither too much nor too little.
At KPMG Meijburg & Co, we act on your or your organization’s behalf and will liaise with the tax authorities to ensure that the tax audit runs smoothly and is completed as efficiently as possible, minimizing any economic or reputational disruption to your business.
