As the result of the actual audit in 2019 at one of the stores, the company was fined for violation of the tax legislation. According to the tax authorities the audit was conducted based  on the consumer’s complaint about the store’s violation of the payment transactions procedure. Instead, having reasonable doubts about the existence of such a complaint, the company refused to assist the tax authorities in conducting the tax audit. GOLAW attorneys, in its turn, sent a request to obtain a copy of the above-mentioned complaint.

Subsequently, during the court appeal, GOLAW attorneys proved that the consumer’s letter received by the tax authority could not be a sufficient and proper basis for the audit.

Ruling in favor of the company, the court stressed that regardless of the taxpayer’s decision to admit (not admit) officials to the audit, further appealing its consequences in the form of tax notices-decisions and other decisions, the taxpayer is not deprived of the opportunity to refer to legislation violations of the supervisory body for conducting such an inspection.

The absence of legal grounds for the actual audit leads to the recognition of the latter as illegal and inconclusive. The tax audit report, obtained during the inspection, cannot be recognized as the evidence in the case, as it was obtained in violation of the procedure established by law.

GOLAW partner, head of tax practice Iryna Kalnytska, senior associate Olena Sulyma and junior associate Anna Sokur worked on the project.

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