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Transport companies: your remedies in case of tax audit

Home > French Tax Law | Published 2014-11-18

The main sources of control

The transport sector, both in the road and maritime sectors, is one of the prime targets of the tax administration.

Road freight transport is thus subject to a plurality of taxes affecting the company itself, its vehicles, diesel and circulation. Taxation therefore weighs heavily in this area, hence the recent mobilization against the heavy weight tax or environmental tax.

The domestic consumption tax on energy products (TICPE) is a single tax paid by road transport, followed closely by tolls, the axle tax, but more "classic" taxes, such as local economic contribution (CET), are all opportunities that attract increased vigilance from the treasury.

VAT also provides a windfall to the inspectors of the Directorate General of Public Finance (DGFIP). It is an inexhaustible source of many adjustments because of the complexity of the texts.

The benefits of international transport of goods, intra or not, give rise to specific territorial rules enacted by the General Tax Code.

The company that wrongly applies exemption of exports is exposed quickly to control risks.

The consequences

Regardless, even in good faith compliance with the various "rules", you are likely to receive notice of tax audit. All your accounting records and supporting documents will be examined in the context of several interventions.

After this check, barring a miracle, you will be the recipient of a proposed correction informing you of irregularities and above, adjustments considered.

Moreover, substantial penalties may be applied in cases of willful misconduct findings, abuse of law or fraud. The increases will be between 40 and 80%.

Needless to say, the implications are likely to be disastrous for the company and even jeopardize the continued activity.

What recourse is to be taken in case of a tax audit?

Upon receipt of the proposal for rectification, you have the ability to respond to the observations. This exchange with the tax authorities then allows you to explain your arguments to the general counsel.

In case of disagreement, a hierarchical recourse is already open you to the top of the auditor, the principal inspector or divisional inspector. If it maintains its position in front of the inspector, you have the option to bring the dispute to the departmental brigade sector.

Finally, depending on the nature of the enhancements that have been maintained in the name of your business, you have the option to enter the County Commission of direct taxes and taxes on sales.

If all these remedies have failed, you can try to make your voice heard by introducing a contentious claim. This, coupled with a mandatory application for suspension of payment (to avoid the initiation of proceedings by the service recovery) must be filed on or after the implementation of tax collection contestation. If this fails, you have to turn to the Administrative Court.

In a case of tax auditing, it is important to surround oneself with the legal advice of a tax lawyer, as well as a connoisseur of transport law.   This would be quite an asset. This experienced professional will put all of his expertise in tax matters into the service of defending the prime interests of your business.

This article is available online for public information purposes. It is updated regularly, as needed. Due to the constant evolution of the laws and the legal system, we cannot guarantee that the information in this article is still applicable. We invite you to contact us with any legal questions or concerns you have regarding this topic at +33 1 56 79 11 00. In no way can this firm be held liable for articles that contain inaccuracies or are now out of date.

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