Writing off RUB 75 mln of taxes in court

A tax inspectorate violated the terms, delivered a decision on the audit with a five months' delay and issued a tax payment request a year later.

How can you take advantage of such slowness of the tax authorities?

The case on recognizing RUB 75 mln of tax debts as uncollectable arrears.

Case was handled by

The on-site inspection of the transport company ended in a typical way: the counterparties were found to be technical companies, and the taxpayer was assessed RUB 75 mln. There is little chance of proving the case in court in this category of disputes.

However, there was one important nuance to this case: the decision on the audit was made on March 13, 2019, but delivered to the taxpayer only on September 18, 2019, that is, 6 months later!

The fact is that the Supreme Commercial Court back in 2013 pointed out that missing by the tax authority of one term does not change the duration of another term. The Supreme Court then noted that a decision to enforce collection of debts made outside the established cumulative time limits is invalid.

This position was interpreted somewhat ambiguously by the tax authority and subordinate courts. In their opinion, the time limits should be counted from the moment when the decision was actually delivered to the taxpayer.

We thought otherwise. The time limits should be calculated after the decision should have been delivered under the law. There were very few precedents of this kind reported in the country by that time. But it was the only way to contest the arrears.

The specialists of our company have calculated the time limits for the tax authorities to make decisions on the collection of taxes. The analysis revealed that the inspectorate had missed all the time limits set forth by the law. So we went to court with claims to recognize the following as invalid:

1. Tax payment request;

2. Decision on the suspension of transactions with accounts;

3. Decision on the collection of debts using the funds in bank accounts;

4. Decision on the collection of debts using other assets of the taxpayer.

In addition, we made a claim to recognize the arrears as uncollectible and remove the relevant entries from the current accounts.

The tax authority insisted that the time limits should be counted from the date on which the decision had been delivered. By the time this award was made, there were fewer than 10 cases with a positive result across the country. Most courts upheld the position of the tax authority. We managed to convince the court that the inspectorate had missed the established time limits.

As a result, the arrears were recognized uncollectible and had to be removed from the current accounts, thus, our client saved RUB 75 mln.

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