When is it worth requesting a tax audit?
June 24, 2024 | 40,00 EUR | answered by Benjamin Hohenadel
Dear tax advisor,
My name is Selma Bacigalupo and I have been running a small business in the field of business consulting for several years. In recent weeks, I have heard from other entrepreneurs that it can be beneficial to request a tax audit. I am now wondering if this is also something to consider for my company and when it is generally worthwhile to request a tax audit.
In terms of the current situation: Although my business is generating stable profits, they have been slightly declining in recent years. Additionally, I have made some larger investments that have made the accounting somewhat more complicated. I am unsure if my tax declarations are correct and if I might have to expect tax payments.
My concerns mainly lie in the possibility of having made errors in my tax returns that could lead to additional payments. Additionally, I want to ensure that my business is optimally positioned in terms of taxation and that there are no risks that could lead to legal consequences.
Therefore, my question is: When is it worthwhile to request a tax audit? Are there specific indicators that can help me determine if a tax audit is advisable? What are the advantages of a tax audit and what potential risks could be associated with it? And what steps should I take to request a tax audit?
Thank you in advance for your support.
Kind regards,
Selma Bacigalupo
Dear Mrs. Bacigalupo,
Thank you for your inquiry regarding a possible tax audit for your company in the field of business consulting. A tax audit can indeed be useful to ensure that your tax returns are correct and to uncover any potential errors that could lead to tax payments.
In your case, where profits are declining and larger investments have been made, it may be particularly important to request a tax audit. Investments can make accounting more complicated, and it is important to ensure that they have been recorded and accounted for correctly. A tax audit can help you uncover potential discrepancies and clarify your tax situation.
Another important aspect in favor of a tax audit is optimizing the tax position of your company. Through an audit, potential tax benefits and savings that may have been overlooked so far can be identified. Additionally, a tax audit can help minimize any risks that could lead to legal consequences if tax regulations have not been followed.
There are some indicators that can help you determine if a tax audit is necessary. These include noticeable changes in profits or accounting, significant investments, or unclear tax issues. If you are unsure whether your tax returns are correct or if you may be facing tax payments, a tax audit can provide clarity.
To request a tax audit, you should contact your local tax office and submit a corresponding application. It is advisable to prepare thoroughly beforehand and have all relevant documents and records ready for the audit.
Overall, a tax audit can bring many benefits, such as optimizing the tax position, uncovering potential tax benefits, and minimizing risks. It is important to regularly assess whether a tax audit is necessary for your company to clarify your tax situation and avoid potential errors.
I hope this information is helpful to you and I am available for further questions.
Best regards,
Benjamin Hohenadel
Tax Advisor
