In a ruling dated 2 August 2012, the Federal Commercial Court of Uralsky district (the “FCC”) held an organisation liable despite the latter’s compliance with a tax authority's clarifications.
As a result of a field tax inspection, the tax authority charged additional profits tax based on the fact that sums paid to a counterparty as remuneration for services rendered had been included without grounds in the organisation’s expenses. To substantiate the fictiveness of the business transaction, the tax authority specified that primary accounting documents contained unreliable information: (i) the counterparty is absent at the address stated in the documents; (ii) the documents are signed by unidentified persons; and the director of the company-counterparty had denied any business relations with the inspected organisation.
Defending its position in court, the organisation referred to the fact that it had acted in accordance with a written reply of the head of the tax inspection to a request concerning the procedure for taxing the transaction with that particular counterparty.
Under the Tax Code of the Russian Federation, fulfilment by a taxpayer of written clarifications of a tax authority addressed to this taxpayer or to the public at large regarding the procedure for paying tax or other tax matters is considered as a circumstance excluding the responsibility of the taxpayer provided, however, that such clarifications are contained in a document which refers, by spirit and content, to the circumstances and periods in which the tax offence was committed.
The FCC held in tax authority's favour. It argued that the reply of the head of the tax authority (i) was of a general nature and (ii) had been given without reference to specific facts and thus could not serve as written clarifications of the tax authority.
Consequently, requests to the tax authority for any official clarifications should be drafted with particular care to ensure that all essential requirements are complied with. Otherwise, the taxpayer will not be able to use these clarifications in court in case of a subsequent dispute with the tax inspectorate.
[Ruling of the Federal Commercial Court of Uralsky district No. F09-6860/12, dated 2 August 2012, regarding case No. А71-9368/2011]