Very often, tax inspectors decide larger amounts of fiscal debt after a fiscal inspection. However, any fiscal decision issued by Romanian National Agency for Fiscal Administration may be challenged. Sometimes, inspectors make decisions that do not fully comply with the legal provisions. A Romanian lawyer specialized in commercial litigation and administrative law can help you challenge the decision of the tax inspection, say representatives of the commercial litigation department of Pavel, Mărgărit & Associates Romanian Law Firm.
“Pavel, Mărgărit & Associates Romanian Law Firm defended many companies against the fiscal authority, proving that the decisions of some tax inspection were illegal. The law firm obtained in Court the cancellation of the unjust decision issued by Romanian National Agency for Fiscal Administration. In one file, the Romanian National Agency for Fiscal Administration had set a large amount of money as fiscal debts, considering that our client, a former manager, was directly responsible for the losses of the company. The company had in the meantime entered bankruptcy procedure. Thanks to our advice and representation the Court maintained the accountancy expertise report presented by our Client. In this way, the Court rejected the value of the financial losses claimed by Romanian National Agency for Fiscal Administration”, said Radu Pavel, the Managing Partner of Pavel, Mărgărit & Associates Romanian Law Firm.
At the same time, the law firm has managed many cases when tax inspectors have come to the conclusion that some of the customers have wrongly deducted value added tax and income tax. However, there was no legal basis for inspectors to qualify as non-deductible the VAT. Pavel, Mărgărit & Associates Romanian Law Firm obtained a favorable decision for the Client in the Court.
In the first quarter of 2019, tax inspectors carried out 10,056 tax inspections, setting additional payment obligations worth Euro 300 million. For the entire year 2018, the additional payment obligations set by ANAF were Euro 1,3 billion. During the inspections carried out in the first quarter of 2019, ANAF imposed fines to the taxpayers amounting to Euro 544.000 and made 277 criminal complaints. Both the number of criminal complaints and the amount of fines imposed by ANAF inspectors in the first quarter of 2019 decreased compared to the same period in 2018.
During inspection, Romanian National Agency for Fiscal Administration verifies if the company complied with the legal rules when declared and transferred the tax obligations. Often, fiscal inspectors charge companies additional payment obligations after the inspection. Sometimes, this is an abusive practice.
Tax administrative acts may be challenged. The appeal is filed with the fiscal body issuing the act. The institution may allow the appeal and cancel the fiscal administrative act. At the same time, the institution may reject the appeal.
If the fiscal body rejects the appeal, the company may address the Court, requesting the annulment of the decision through which the fiscal body rejected the appeal and the annulment of the fiscal administrative act.
According to Law 207/2015, the Romanian Fiscal Procedure Code, the fiscal administrative act is null if:
a) it violates the legal provisions on jurisdiction;
b) it does not contain the identification data of the fiscal body and the identification data of the taxpayer etc .;
c) it contains an obvious error.
In addition, art. 175 of the Romanian Civil Procedure Code stipulates that “the procedural act is null and void if, by failing to comply with the legal requirement, the other party has suffered an injury that can only be removed by dismantling it.”
At the same time, in many occasion tax inspectors deny company’s right to deduct VAT for real services that are essential for company’s activity.
The refusal to deduct VAT on other grounds than those provided by law violates the principle of VAT neutrality. Therefore, it is illegal for the tax authority to impose additional conditions in order to annihilate the exercise of the right of deduction.
Each administrative decision may be challenged. Companies that hire lawyers specialized in commercial litigation and administrative law are more likely to obtain cancellation of fiscal decisions, either through appeals to the fiscal body or by a Court decision, according to Romanian lawyers specialized in commercial litigation and administrative law from Pavel, Mărgărit & Associates Romanian Law Firm.
Pavel, Mărgărit & Associates Romanian Law Firm is one of the top law firms in Romania, which offers legal services at the highest quality, beyond client’s expectations. The Law Firm approaches the cases with maximum professionalism and dedication. It’s ultimate goal is obtaining exceptional results and achieving the client’s objectives, in a time efficient manner. Among Pavel, Mărgărit & Associates clients are top multinationals and local companies. In 2019, the success stories of the Romanian Law Firm have brought recognition of the most prestigious international guides and publications. Thus, Pavel, Mărgărit & Associates Romanian Law Firm ranked second place in Romania in the rankings of business law firms with the most relevant expertise this year, realised by the Legal 500 publication, the most prestigious guide for law firms in the world, based in London, UK. The law firm is also recognized internationally by IFLR 1000 Financial and Corporate Guide 2019. Pavel, Mărgărit & Associates Romanian Law Firm is also the only law firm in Romania recommended by the Global Law Experts Director in London in the Dispute Resolution area of Practice. All the relevant information regarding Pavel, Mărgărit & Associates Romanian Law Firm including areas of practice and the most important deals can be found on the website www.avocatpavel.com, which is one of the most complex law firm websites in Romania.