Provided legal support when the outcome of a tax audit was appealed out of court

The team of the tax practice represented the interests of an owner of major shopping centres. Tax claims were raised against the client over two breaches that were classified as deliberate misconduct: the unlawful deduction of the loss after the merger of a loss-making company and the unlawful deduction of VAT in relationships with a suspicious business partner. The task set before our lawyers was not to allow for the breaches to be classified as deliberate and to justify that the merger of the loss-making company did not have a tax-related objective and, consequently, the loss was deducted in line with the law. Had the results of the audit been held to be just, the client would have borne considerable losses. In addition, it was of the utmost importance to shield the management of the company from personal risks arising from the breaches being classified as deliberate.

The specialists of the practice prepared detailed objections to the audit report, represented the interests of companies during the review of the audit materials, advised the client during additional measures of tax control and participated in the interviews of witnesses.

As a result, both the tasks were resolved: the claims relating to the losses from the merged company were not included in the ultimate decision of the tax authority, while the second offence was classified as unintentional and the fine it entailed was reduced severalfold.