Tax office

An “X-ray” of their property and living conditions is required by the Tax Office from professionals who decide to challenge the minimum assumed income by requesting a tax audit. The professionals they should disclose not only for themselves but also for their spouses, cohabiting partners and protected members details of bank accounts, cards if they have bank safes, cash and cryptocurrencies but also if they traveled abroad and expenses for electricity, water, landline and mobile phone.

In fact, the audit can be extended over a period of five years but also to the other income declared by the taxpayer from any source or cause such as income from real estate, dividends, interest, etc.

According to the decision of the governor of AADE, Giorgos Pitsilis, the disputing of the minimum presumed income from business activity will be done digitally through a new platform which will be activated in the first fortnight of May. On the platform, professionals will be able to submit a request for a check or for objective reasons (military service, hospitalization, pregnancy, etc.).

Request for an audit

In the event that the professional considers that he is wronged by the imposition of the minimum presumptive income, he has the possibility to submit a request for an audit. This process takes place in two steps:

1st Step: The taxpayer must declare in his timely tax return that he wishes to dispute the minimum income, requesting a tax audit (codes 443-444 of E1 of the income tax return).

2nd Step: If he has already filled in the relevant code in E1 of the income tax return, the taxpayer must, at the latest within 60 days from the deadline for submitting the return, fill in a questionnaire with his financial situation and living conditions of himself, his/her spouse/MSS and the protected members, which will be evaluated during the tax audit.

Property picture and living conditions

In the questionnaire to be completed on the AADE platform, the taxpayer should disclose to the tax office:

• Bank accounts, (personal or business) in Greece and abroad, accounts opened and closed in the same tax year, account number, beneficiaries.
• Details of investments/holdings and other securities in Greece and abroad, amount of capital invested, method of acquisition (purchase, inheritance, donation), year of acquisition, etc.
• If he leases bank lockers.
• Investments in works of art, collections, valuables and other items with year of acquisition, method of acquisition, purchase value and owner details.
• Cars, motorcycles, boats and aerials
• Available cash.
• Cryptocurrencies available
• Owner-occupied residences (main, secondary, country house) together with electricity and water supply number as well as annual expenditure for electricity and water.
• Fixed and mobile phone costs
• Debit, credit and prepaid cards with annual transaction amount.
• Car and two-wheeler insurance policies with registration number, name of insurance company, duration of insurance and annual premium.
• Life, health, retirement, death, personal accident insurance plans for all family members.
• Real estate insurance with type of insurance, name of the insurance company, duration, address of the property and premium.
• Expenses for tuition, tutoring, food, sports.
• Details for domestic and foreign trips (destination, duration in days, accommodation details, travel, accommodation and food expenses).

The audit is carried out within 12 months of notification of the audit order. The Tax Administration has the right to determine his income based on every available element or by indirect control methods and to extend the control to previous tax years and/or other taxes or other tax objects. Upon completion of the audit, an act of corrective tax assessment is issued and any additional amount of tax is confirmed or the tax that has been confirmed on the amount that is not due, is deleted or refunded as the case may be.

Request for objective reasons

The request is submitted directly to the platform after the submission of the tax return and the issuance of the settlement statement and until the notification of an income tax control order or until the statute of limitations of the Tax Administration’s right to issue a tax determination act.

The objective reasons that the taxpayer may invoke and the supporting documents submitted to prove them are:

• Military service, for proof of which if the taxpayer’s service has expired, a certificate of enlistment status is provided, and if the taxpayer is still serving his service, a certificate of the Unit he serves is submitted.
• Imprisonment, for proof of which a release from the detention center or a detention certificate is submitted.
• Hospitalization in a hospital or clinic, for the proof of which a certificate of hospitalization in a public hospital or private clinic must be submitted.
• Inability to exercise an activity due to pregnancy, for the proof of which a pregnancy certificate is submitted either from the IDIKA or from a public hospital or private clinic.
• Inability to exercise an activity during the 12 months after childbirth or the adoption or fostering of a child, for the proof of which the following must be submitted: aa) in the case of childbirth, a birth certificate or registry act, bb) in the case of adoption, the court decision by which the adoption, accompanied either by a certificate of finality or by a proof/report of service of the decision to the competent Prosecutor and a certificate of non-exercise of remedies and c) in the case of fostering a child, the act of placement in a foster family (judicial decision, contract, act/decision of the competent institution) and a certificate of registration of the minor in the National Register of Minors or in the National Register of Approved Adoptions or in the Register of Unaccompanied Minors. In the case of adoption, the time of commencement of its effects as defined in the Civil Code is taken into account, i.e. the time when the court decision became final either according to the certificate of finality, when it is presented, or after thirty (30) days from the notification of the court decision to the competent prosecutor and the non-exercise of remedies. If the adoption of the child takes place after the adoption, the first integration of the child into the taxpayer’s family through the adoption process is taken into account.
• Extensive natural disasters that made it impossible, in whole or in part, to carry out his professional or business activity. In order to prove the impossibility, a decision/certificate of the competent body for the classification of the business as affected or a decision/deed of the competent body providing state aid to deal with the damage caused by a natural disaster as first aid or a grant, or an advance grant . The total or partial inability to carry out the activity lasts for as long as the declaration with the decision issued for the area where, as the case may be, the company is based or has an establishment, in a state of civil protection emergency, is valid.
• Revocation of the operating license of their individual business or their professional license, for the proof of which a decision of the public authority by which the operating license or the professional license was revoked or a relevant certificate from the competent body is submitted.
• Prohibition of the operation of the shop or other place of exercising their professional or business activity in application of a decision of a public authority for reasons of protection of public health or another reason dictated by the public interest, for the proof of which the decision of the public authority is submitted.
• Other reasons of force majeure beyond those mentioned above, i.e. uncaused events of a completely exceptional nature, which were not expected, nor could have been prevented or prevented by the taxpayer, nor with measures of extreme diligence and prudence and which prevented the exercise of business activity for a specific period of time. Such an event may in particular constitute a serious health problem for the taxpayer or his child, due to an illness or accident, for which hospitalization is not required, but it is proven on the basis of a medical opinion from a hospital or clinic that it prevents, for as long as it lasts, the exercise of the business activity of the taxpayer.

The application is examined by the Head of the department responsible for receiving the taxpayer’s income tax return. The Supervisor checks the truth of the claims and the accuracy of the debtor’s evidence and in case of their acceptance, he is obliged to reduce the minimum annual income accordingly, taking into account the specific period of time (days) for which it is proven that the exercise of his business activity was limited taxpayer. It then issues a new act of administrative determination of income tax which is notified to the taxpayer.

Source: Ot.gr