Doing Business 2017: Equal Opportunity for All by A World Bank Group

Author:A World Bank Group
Language: eng
Format: epub

Source: Doing Business database.

▪ The process of an audit if the case scenario is likely to trigger an audit. Time includes: time spent by TaxpayerCo. on gathering information and preparing any documentation (information such as receipts, financial statements, pay stubs) as required by the tax auditor; time spent by TaxpayerCo. in submitting the documents requested by the auditor.

A total estimate of zero hours is recorded if the process of claiming a VAT or GST refund is done automatically within the standard VAT or GST return without the need to complete any additional section or part of the return, no additional documents or tasks are required as a result of the input tax credit and the case scenario is unlikely to trigger an audit. It is assumed that in cases where taxpayers are required to submit a specific form for a VAT refund request and additional documents these are submitted at the same time as the VAT return.

An estimate of half an hour is recorded for submission of documents requested during an audit in the case of an audit taking place if the submission is done electronically and takes a matter of minutes. An estimate of zero hours is recorded in the case of a field audit if documents are submitted in person and at the taxpayer’s premises.

In Kosovo, for example, taxpayers spend 30 hours complying with the process of claiming a VAT refund. Taxpayers must submit a special form for a VAT refund request in addition to the standard VAT return. Taxpayers spend two hours gathering information from internal sources and accounting records and 1 hour to prepare the form. Taxpayers must also prepare and have available for review all purchase and sales invoices for the past three months, a business explanation of VAT overpayment for large purchases or investments, bank statements, any missing tax declaration and a copy of fiscal and VAT certificates. Taxpayers spend four hours preparing these additional documents. Taxpayers must also appear in person at the tax office to explain the VAT refund claim and the reasons for the excess input VAT in the month of June. This takes three hours. Additionally, the claim for a VAT refund would trigger a full audit at the taxpayer’s premises. Taxpayers spend 20 hours preparing the documents requested by the auditor including purchase and sales invoices, bills, bank transactions, records on accounting software, tax returns and contracts. Taxpayers submit the documents to the auditor in person at their premises (zero hours for submission).

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