Tax Audit Triggers: What You Should Know

“Remember that even if you haven’t been audited in the past, it doesn’t mean you won’t be in the future. And it only takes one audit to ruin your day”. Kathy Burlison
 

This Thursday came with a special occasion. Eid Al Fitr! Happy Eid Al Fitr to everyone. Remember not to fill your belly with more than you can digest. Well, you would be able to digest your food, but there is no point in dealing with constipation first. Anyway, enjoy and have a fun filled day. Welcome to Tax Thursday.

It is important to know the tax audit red flags. Therefore, today’s edition of Tax Thursday would be based on various tax audit triggers.

1. Taxpayers with nonstop Nil or Loss returns. This case has likewise to be checked particularly where different firms in a similar industry make profits.

2.  Taxpayers with non-related ampleness proportions. For this situation your different monetary proportion/operational proportions are not related

3. Indications for presence of a parent body particularly abroad, various branches from one side of the country to the other, departmental courses of action and business division, which are all markers of counterfeit exchanges and move valuing plans. Each move estimating plans should be confirmed.

4. Double Taxation claims are those including unfamiliar profit where some expenses had been paid effectively on the pay. This must be confirmed. However, the tax authority dislikes you to pay more than necessary where there is in existence some component of duty deals between the homegrown country and another country.

5.  Industrial/bunch administrative consistence compliance could prompt duty reviewing your own firm.

6. You did not report all your stock trades

7. You did not report all your income

8.  Indication of contribution of different organizations, related gatherings, like holding organization, auxiliaries, and partner organizations. These lead to counterfeit exchanges.

9. Regular numerical mistakes.

10.  Re-association/rebuilding will draw in tax audit, particularly liquidation, consolidation or procurement.

11.  Directive from higher government authority.

12. Cash-based business – this class of money managers don’t keep legitimate books of record.

Taxaide Professional Services Ltd (Taxaide) deploys different tools to help taxpayers and administrators pursue streamlined, discreet, transparent, and efficient tax functions that skilfully addresses tax management and administration issues. This leaves room for efforts to be directed at more strategic concerns. Our tax management framework explores several dimensions to ensure every tax decision results in value creation in as many possible ways.

We work with the organisational model, policies, processes, and technologies that are available; we are that dynamic. We explore, assess, prioritize, and implement improvement opportunities; we are that objective. At the end, we always arrive at process efficiency, cost /time saving and more effective resource allocation, generally. With us, your benefits include having additional time on your hands for greater value creation. We take care of the tax-related headaches that would not have allowed the sustainable health of your economic unit.

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