Tax audits on transfers: support and appeals
Tax audits on transfers: support and appeals
The services will comprise of two stages of defense:
- Cancellation of a tax audit;
- Appealing the results of the tax audit.
Cancellation of the tax audit will be based on legality of the tax audit, i.e. on the compliance thereof with the legislation of the Republic of Kazakhstan.
Appeal against the tax audit will consist of the following stages:
1.
Article 666 of the Tax Code in accordance with the provisions of this Code, the claim of a taxpayer (tax agent) against the notice of a tax audit shall be considered by a higher tax authority.
Article 667 of the Tax Code, the claim of a taxpayer (tax agent) against the notice of the tax audit results shall be submitted to higher authorities of the Tax Service within thirty days after the delivery of the notice to the taxpayer.
Article 670 of the Tax Code, the claim of a taxpayer (tax agent) shall be reasonably decided within thirty working days after the registration of the claim while the claims of large taxpayers that are subject to monitoring - within forty five working days after the registration of the claim.
Article 671 of the Tax Code, upon the results of consideration of the claim of a taxpayer against the notice of the tax audit certificate a higher authority of the Tax Service shall make one of the following decisions:
1) To leave the appealed notice of a tax audit without change, and dismiss the claim;
2) to cancel the appealed notice of tax audit certificate in full or partially.
A taxpayer may appeal the decision in court.
2. The case consideration in the Court of First Instance - the Specialized Inter-district Economic Court of Astana (Astana SIEC). The taxpayer has rights to claim to the SIEC in Astana within 3 months after the receipt of the decision from the Tax Committee of the Ministry of Finance of the Republic of Kazakhstan. The amount of the state fee will be 1% of the claimed amount. According to the legislation of Kazakhstan, the case will be considered under a special action proceedings within 1 month after the initiation of the proceedings.
3. The case consideration in the court of appeal (second) instance - the Appeal Board of Civil Division of the Court of Astana. Within 15 calendar days after the receipt of the decision of the court of first instance, each party may file an appeal.
4. The case consideration in the court of cassation (third) instance - the Appeal Board of Civil Division of the Court of Astana. Within 15 calendar days after the receipt of the decision of the court of second instance, each party may file an appeal.
5. The case consideration in the court of supervisory (fourth) instance - Supervisory Board of the Supreme Court of Kazakhstan. Within 1 year after the decision of the court of appeal, each party may file a supervisory claim.
If you have any questions, we will be happy to discuss at any time of your convenience.
Recent Experience:
- Drafting of amendment agreements to the Crude Oil
Sale-and-Purchase Contracts to bring the Contract in compliance with
the new Law of the Republic of Kazakhstan ‘On Transfer Pricing’.
- Drafting of the transport contracts between seller and buyer with differential determination of oil and gas companies.
- Performance of pre-control audit and drafting of the opinions for Kazakhstani companies performing:
-
the exportation of oil, oil products and gas condensate, lead, zinc,
gold, silver, grain, coal, as well as zinc and lead concentrate;
- the importation of equipment for oil and gas and metallurgical sectors;
with
regard to compliance thereof with the transfer pricing law. Thereat,
the audit was performed according to the methods and forms used by tax
agencies.
- Drafting of opinions on possible facts of transfer pricing:
- for Kazakhstani-Russian gas enterprise when exporting dry gas and gas products;
- for Kazakhstani-China, Kazakhstani-Russian gas enterprises engaged in the export of oil and oil products;
-
for mining and metallurgical enterprises engaged in the export of oil
and oil products, lead, zinc, gold, silver, coal, zinc and lead
concentrate;
- for agricultural enterprises engaged in the export of corn, wheat, barley and cotton.
- Risk assessment for enterprise with regard to operating in the state with preferential taxation (offshore).
- Comparative analysis of prices existed during the period 2004 through 2009 for the main export goods items.
- Representation
of interests and protection of the rights of foreign oil companies,
Kazakhstani oil companies in disputes on transfer pricing including
successful appealing of audit results (over 5 bln Tenge were cancelled).
- Representation
of interests and protection of the rights of mining companies in
disputes on transfer pricing including successful appealing of audit
results (over 12 mln Tenge were cancelled).
- Monitoring of
transfer pricing transactions of the companies performing export of
cooper, steel, lead, zinc, gold, silver, aluminum oxide, chrome ore,
etc. in order to submit the results to the Tax Committee of the
Republic of Kazakhstan.
- Drafting of Agreements for Transfer Pricing Application that will be concluded between fiscal agencies and tax payers.
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