How to rehabilitate “fictitious” transactions. We confirm the reality of transactions How to prove the reality of a transaction with a single counterparty

2013-10-06 11:07:48

Those taxpayers who enter into transactions only for the sake of further obtaining tax benefits, as a rule, do not pay any attention to the very subject of the agreements. Also, due attention is not paid to the real possibilities of execution. People believe that if all the documentation is in order, then it is in no way possible to be caught in deception. As practice shows, often focusing on the circulation of documents, without taking into account real possibilities, leads to defeat in the “war” with representatives of tax authorities. After all, tax officials have the opportunity to prove the transaction is fictitious for a number of reasons.

Among such reasons, he considers the lack of resources from suppliers and insufficient number of workers. Often operations are carried out with goods that are not produced at all, and it is impossible to move the property. In addition, transactions are concluded in unrealistic time, and a huge amount of negligence is allowed in contracts. Let's try to sort everything out in order.

Lack of necessary production resources

This is the most common mistake taxpayers make when interacting with fly-by-night companies. Often suppliers do not actually have the necessary production capacity or resources that are required to fulfill the terms of the contract. It's not that difficult to determine. You just need to carefully analyze the contract concluded with the supplier and check the potential counterparty. The failure of the supplier sometimes turns out to be too obvious.

As usual, let's give an example.

The contractor was unable to perform mechanical and heat treatment work. After all, he had no real opportunity for this at all. There were no production facilities or capacities. At the same time, the taxpayer had his own equipment, which was necessary for this. Together with other factors, the judicial representatives decided that it was simply impossible to fulfill the obligations imposed under the concluded agreement.

An additional argument in favor of representatives of tax authorities is the detection of the real performer of fictitious work or services. For example, such performers may be employees who use their own fixed assets.

The organization ordered industrial waste removal services using heavy vehicles. During the inspection, it was discovered that the service could not be provided. After all, the performers did not have any transport of their own at all. In addition, the taxpayer’s employees indicated that they removed all the garbage themselves, and no heavy-duty vehicles were used. The tax authorities' arguments were recognized as legitimate, and the court ruled in their favor.

Of course, the taxpayer will also never be left in debt, having begun to prove that the counterparties rented fixed assets or hired third parties. But a thorough analysis of activities always helps to clarify the situation.

In addition, counterparties sometimes simply do not have enough employees to perform a certain task.

Number of staff

Insufficient human resources to carry out a certain transaction is a clear signal of a fly-by-night firm.

As usual, we provide an example from real practice.

According to the director of the enterprise, all the property that was acquired was to be subjected to future reconstruction, and in the future used as space for the production of reinforced concrete products. There were officially two people on staff. Of course, they were not able to fully ensure the exploitation of real estate.

Citizens who create “one-day” companies, as a rule, are not going to devote much time to this. Therefore, labor relations with employees or payroll are not formalized. Most often, the only employee of such an organization is the founder himself, who also holds the positions of chief accountant and manager. Often he formally performs all sorts of other duties (builder, consultant or salesman). Representatives of the tax structure can only theoretically ignore this fact. Most often, such information is used as the main evidence of the unreality of the transactions performed. In addition, the court compares the physical capabilities of employees with the reality of a specific transaction.

Let's give a clear example.

In order to provide services for receiving and sorting non-ferrous and ferrous metals, as well as carrying out all unloading operations, transportation and forwarding, the entrepreneur would need technical and managerial personnel. At the same time, the taxpayer did not enter into a single employment contract with potential employees.

Even from such seemingly critical situations, taxpayers often manage to get out. They require evidence that the counterparty did not engage individuals under a civil law agreement or a personnel lease agreement. Such arguments can only help in cases where other arguments for unreality simply do not exist.

A product that was not produced at all

Some unscrupulous taxpayers, in a constant pursuit of savings, lose their own vigilance, not noticing that the transactions reflected in the documentation look completely unrealistic. We are talking about products that simply could not be released. For example, production is not possible due to the fact that its volumes significantly lag behind sales. We can cite as an example a classic case in which the tax authorities managed to prove the complete unreality of the transaction.

The organization ordered and then purchased a huge batch of soft toys from the manufacturer. Representatives of the tax authorities were able to calculate that even with continuous manual work (there was no special equipment), four toys could be made in one minute. At the same time, real factories with specialized equipment produce similar goods in an hour and a half.

Another clear example. Carrying out a transaction involving the purchase from manufacturers and the subsequent sale of goods does not seem realistic, because in fact, this product was not produced at all at the time of this very transaction. As a rule, representatives of the tax authorities obtain such information by contacting manufacturers of goods.

For example, a taxpayer who purchased a large consignment of goods from an organization whose solvency is questionable, then sent the goods for export, declaring his right to a deduction for the transactions performed. The tax authorities gave a refusal. Its reason is information received from the manufacturer of a product intended for export, which has not been produced at all for a long time. The refusal to deduct was recognized as lawful at the end of the trial.

Of course, it is almost impossible to prove the reality of transactions with a product that is no longer produced. However, when tax officials do this, it is also difficult to prove the opposite.

The unreality of moving specific property

Representatives of the tax authorities often examine the reality of moving specific property from place to place. The impossibility of movement can be proven in various ways. For example, when appropriate documentation is missing. The logic is quite simple. When transportation actually took place, documents confirming this will be found in any case. If they are not there, then there was no transportation.

As usual, let's give an example.

Judicial representatives concluded that the delivery was unrealistic for the reason that the primary accounting documents were not properly prepared. In addition, there were no all kinds of accompanying and transport documents that would confirm the delivery of goods and would be a sufficient basis for receipt by the buyer.

Tax officials often do not limit themselves to the mere lack of documentation for transportation, exploring the availability of objective possibilities. This often helps them prove that specific transactions are unrealistic. For example, when the carrier does not have the necessary transport at all.

As confirmation of the unreality of the agreement that was concluded between two entrepreneurs, representatives of the tax authority pointed out that the supplier did not have the transport with which the goods were to be transported, as well as warehouse space for storing it. In addition, testimony was taken from a driver working for end customers, who delivered goods without the direct participation of entrepreneurs. The court recognized the obvious guilt of the taxpayer.

And even the actual availability of the necessary transport for transportation still does not provide one hundred percent guarantees of the reality of the transaction. For example, the carrying capacity of such transport may be completely insufficient to transfer the cargo indicated in the invoice.

Let's give a real example from practice.

A sufficient argument for the unreality of the deal was the physical impossibility of transporting goods weighing 1,498.7 tons in one single flight, as indicated in the invoice. The actual carrying capacity of the available transport was only ten tons.

In addition, the weight or dimensions of the equipment sometimes do not allow it to be moved to a specific warehouse specified in the documents.

Example from practice.

Judicial representatives considered that in reality the goods were purchased without intermediaries for the reason that it was simply physically impossible to move such cargo from one warehouse to another. The conclusions were fully supported by the lack of any data on the rental of premises.

In recent times, tax inspectors often pay attention to little things that are noticeable to few. For example, few people pay enough attention to the distance between transportation points, indicating it incorrectly in the documentation.

The tax structure’s argument confirming the unreality of the completed transaction for the delivery of goods by road was the discrepancy between the actual distance between two settlements and that indicated on the invoice.

If you wish, you can find a huge number of such examples. When organizing the fictitious circulation of documents, it is not at all easy to take into account all the nuances. Sometimes documentation is churned out almost blindly, without regard to future consequences.

Location of the parties

In order to prove the actual impossibility of fulfilling the terms of an agreement that was concluded with a “suspicious” counterparty, tax officials often use the factor of the location of both parties during the execution of a specific agreement. Attention is drawn to the place where the contract was concluded. It happens that in this particular place it was impossible to conclude a contract at all due to the influence of certain factors, for example, the head of one of the enterprises was at that time in a completely different place. At the same time, tax authorities pay attention to the question of whether the manager was on a business trip at the time the contract was concluded. If the manager was in a completely different region at the time of execution of the contract, tax authorities may conclude that the transaction in question is unrealistic.

About a hundred contracts for one taxpayer, who was located in the Stavropol Territory, were concluded in the capital with dubious Moscow suppliers. At the same time, the fact of numerous trips by the head of the enterprise to Moscow was not confirmed. Arguments about typographical errors, as well as the signing of the contract at the place of work, were rejected by the court. After all, in the Stavropol Territory the supplier did not have a registered “separate unit” at all.

Tax inspectors often try to recognize an operation as fictitious if it takes place in a foreign region and there are no separate divisions there. They often manage to do this when the contract is not enforceable without the availability at the specified location of the material and human resources necessary to perform specific work.

An argument for the unreality of the concluded transactions for the installation, insulation and painting of several tanks intended for the transshipment and storage of fuel oil in the Rostov region was that the contractor did not have any separate divisions at the place of work.

The tax authorities are also quite seriously concerned about those cases in which the goods are resold several times, but are not transported anywhere. The situation can become significantly worse when resellers are registered in foreign regions.

Example from practice.

The taxpayer kept the metal from the state reserve on its territory. At the end of the “unbooking”, this metal was sold to a third party through intermediaries. After some time, through the same intermediary, this product returned to the entrepreneur again. At the same time, there was no documentation confirming the movement of metal. This allowed the tax authorities to suspect that the goods were not exported anywhere at all. Enterprises officially registered in Kaluga and Moscow took part in the transactions.

The situation can also be significantly aggravated in cases where the parties entering into a transaction are located in different regions, but pay in cash. The question arises as to how the money was transferred to the suppliers. It is unlikely that the taxpayer delivered them personally to the counterparty. A conclusion that cooperation is unrealistic can be made in the absence of evidence to the contrary.

The unreality of the deal in terms of time

Tax officials can prove a connection between taxpayers and fly-by-night firms by examining timing of transactions. For example, the unreality of a transaction can be proven taking into account the physical lack of time to carry out all the operations specified in the contract.

Having recognized the unreality of a specific transaction, the bailiffs proceeded from the fact that, according to the concluded agreement, the personnel of the institution had to perform certain work, but the enterprise, which included one single person, could not cope with the specified amount of work in less than ten days.

Time factors also appear in some other forms. For example, when there is simply no warehouse for proper storage of purchased raw materials, the taxpayer often tries to prove that these same raw materials were immediately sent into production. Entrepreneurs get into trouble if inspectors manage to prove that, given the time involved, it was technologically impossible to carry out such an operation.

The agricultural producer received chemicals and fertilizers from contractors under a contract. According to him, the goods were not stored due to the lack of proper premises, but were applied to the soil immediately. At the same time, the period of soil treatment with chemicals and fertilizers did not coincide at all with the delivery time.

It happens that time gaps, on the basis of which the fictitiousness of a transaction is proven, follow directly from a comparison of the dates of execution of the contract in question and its execution. When such dates cannot be compared, tax authorities have every reason to recognize the transaction as unrealistic.

The court recognized as evidence of the fictitiousness of the transaction the fact that the agreement for the delivery of products was concluded much later than the actual transfer of these products according to the invoice.

In addition to everything described, entrepreneurs who enter into deliberately fictitious transactions often commit other negligence by drawing up contracts with “one-day” companies.

Negligence in drawing up contracts

One of the characteristic signs of falsity when concluding any agreement that imitates a real relationship between two enterprises is the absence of intentions to regulate contractual rights and obligations in detail. Of course, when an agreement is drawn up only on paper, no entrepreneur wants to waste his time on carefully detailing it. If the parties involved do not bother to agree on all responsibilities and rights from the very beginning, tax officials may pay attention to this. Many interesting facts can be gleaned from the subject of the agreement.

A good example.

The court assessed the terms of the contracts provided, which provided for sending the fabric for subsequent impregnation, as well as its return. It was concluded that the operations were unrealistic. After all, the contract in question did not even indicate the brand of fabric that was to be processed. There were also no technical conditions for impregnation or GOSTs specified. In addition, the contracts did not provide for the terms of delivery for processing or the transfer procedure. There were also no certifications or deadlines for completing the work, but at the same time there was a link to them.

Quite often, simple mistakes are made in the documents documenting the actual execution of the contract. After all, the people involved don’t think at all about making the result look natural. For example, in the act of work performed there are no transcripts or documents that form the cost of performing this very work.

An agreement for the maintenance and repair of vehicles was concluded between an entrepreneur-taxpayer and a separate organization. At the same time, those documents that were related to the fulfillment of the terms of the agreement did not at all convince the tax authorities of the reality of the transaction. It was possible to establish that the acts did not contain any information about the services, their cost, as well as the pricing itself. The repair work schedule did not contain a date or reference to the contract. Assessing the formality of the execution of all documentation that was related to the contract, as well as the dishonesty of the counterparties, judicial representatives recognized the transaction as unrealistic.

There are also other indicators that signal to tax officials that a particular scheme is illegal. This also includes the complete absence of any sanctions provided for in the event of failure to fulfill obligations under the contract. A dangerous situation is when the fact of purchasing goods is formalized between suppliers using identical contracts. In addition, there are indicators of illegal schemes that are associated with technical design, for example, facsimiles.

A set of signs confirming the unreality of the transaction

According to current practice, one single circumstance that indicates the unreality of the transaction, as a rule, is not a basis for the court. Most often, in such cases, judicial representatives support taxpayers. Of course, if they find evidence of the actual implementation of the transaction, for example, they provide its immediate result.

According to the position of the modern court, in cases where the necessary production capacity or the balance of goods in warehouses are not available, or there are not enough working personnel, it cannot be said with certainty that the enterprise did not carry out a business operation if there is documentary evidence of this.

In addition, taxpayers who have to respond to accusations with sufficient frequency often provide a considerable number of weighty arguments that the counterparty has entered into an ongoing cooperation agreement with an individual, engaging him for execution. The supplier also has the opportunity to rent the required production capacity. At the same time, taxpayers often make many mistakes that convince the court that the transaction is unrealistic. Tax inspectors sometimes study the issue of unrealistic transactions to such an extent that they find new arguments confirming the impossibility of their actual execution.

The taxpayer immediately executed two contract agreements for the installation of reinforced concrete and metal structures. At the same time, none of the counterparties technically had any opportunity to carry out all the work due to the lack of fixed assets, warehouses, production capacity and personnel that would be needed for implementation. In addition, the counterparties did not even have the appropriate licenses confirming the right to engage in the activity in question. In addition, subcontractors had a number of characteristics characteristic of fly-by-night firms. Representatives of the court decided to recognize the document flow as artificially created by the taxpayer. However, no real operations were carried out.

There are a huge number of examples of cases in which representatives of the tax authority win disputes with the taxpayer when it comes to the unreality of the transaction. It is a whole set of signs that helps tax authorities do this. As a rule, one defect attracts subsequent errors, forming a whole snowball. All this applies not only to obviously unscrupulous taxpayers, but also to those who find themselves in the situation under discussion due to an unfavorable combination of certain circumstances. In such cases, it is necessary to prove that significant negligence was committed when choosing contractors.

Confirmation of a transaction is a document that is signed on the stock exchange by the seller and buyer of a security or other financial asset. The document must be signed immediately after the parties decide to complete the transaction, since its provisions will spell out the basic conditions for the interaction of the parties, which can subsequently be appealed in court.

Transaction confirmation value

The first meaning of the document in question is an accurate description of the rights and obligations of the parties, as well as the three main elements of the transaction. The confirmation will clearly define the date of payment for the purchase of the financial asset, the terms of its purchase, and the amount of the commission that the buyer will need to pay. If the confirmation is not signed, the conditions remain only “in words”; the seller has the opportunity to change them and make the financial transaction unprofitable for the buyer.

The second meaning is that confirmation of a transaction makes each party responsible for the financial transaction being carried out; therefore, if one party fails to fulfill the conditions specified in the document, the other has the right to protect its rights through legal proceedings. Experienced lawyers urge stock speculators to be wary of traders who seek to avoid signing a transaction confirmation by promising guaranteed fulfillment of the agreed conditions.

The third meaning is that transaction confirmation records the activities of each person on the stock exchange, this allows you to structure the entire process of buying and selling financial assets and analyze tax prospects. In fact, the existence of financial exchanges that conduct their operations on the Internet became possible precisely thanks to transaction confirmations: when a transaction is confirmed, information about it can be immediately distributed over the network, since changes will no longer be made to the agreement, the decision made by the parties is unambiguous.

The fourth meaning is that confirmation of the transaction expands the possibilities of speculation in the market, because after signing the agreement, the trader receives a guaranteed opportunity to dispose of the acquired asset.

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What documents and arguments should be submitted to the tax authorities to confirm that transactions involving the purchase of goods for resale from this supplier are real in nature.

Question: regarding confirmation of the reality of the transaction and the choice of supplier. Our organization supplies tools to various organizations. We produce some of the tools in-house, and purchase some of the goods from third-party suppliers. During the desk audit, the Federal Tax Service made arguments that the transaction for the purchase of goods from a third-party supplier fictitious, since of the supplier’s employees only the Director is registered and this company does not have warehouse premises. Before signing a contract with this supplier, we compiled a set of documents regarding this supplier: Extract from the Unified State Register of Legal Entities, we asked the supplier for statutory documents. Please explain what documents and arguments to submit tax authorities to confirm that transactions involving the purchase of goods for resale from this supplier are real in nature. I ask you to send a detailed response.

Answer: The reality of a transaction with a given counterparty can be confirmed by documents that reflect: the results of the search and selection of the counterparty, the source of information about it (website, advertising materials, proposal for cooperation, information about the counterparty’s previous transactions), the results of monitoring the market for relevant goods, studying potential counterparties, justification for choosing this particular counterparty, drawn up on paper, business correspondence.

As arguments, you can indicate that when concluding a transaction with this counterparty, you had an idea of ​​​​how its execution would occur, that its terms are ordinary.

Rationale

Tax inspectors will be less likely to prosecute for connections with one-day companies, but will check the company’s work more deeply

“The Tax Service strongly recommended that the inspectorates change their approach to checking transactions that companies enter into with their counterparties (letter of the Federal Tax Service of Russia dated March 23, 2017 No. ED-5-9/547@, hereinafter referred to as the letter). The reason for this was disputes with taxpayers, which the Supreme Court of the Russian Federation considered at the end of 2016 and beginning of 2017. The courts began to side with taxpayers.

Now, in order to assess additional taxes for a company, it is not enough to establish that its counterparty has a nominee director. Inspectors will have to study the transactions more carefully and find out who actually organized the scheme with fly-by-night deals.

Previously, inspectors formally collected evidence of unjustified tax benefits. They did not dispute the reality of business transactions, but only concluded that the primary documents were unreliable (). They usually had two main pieces of evidence:

1. interrogation of the nominee director. The director stated that he was not involved in the activities of the counterparty company;

2. handwriting examination of primary documents. The expert established that the signature was not put by the director.

How practice will change

Inspectors will look for the company's intent in using fly-by-night stories. They will find out who controls the problematic counterparty and who actually receives an unjustified tax benefit (paragraph 4 of the letter). In particular, they will prove:

1. interdependence of problematic counterparties with the company;

2. consistency of actions between the parties to the transaction;

3. unreality of transactions.

If it is not possible to prove intent, they will try to prove negligence (paragraph 5 of the letter), namely: insufficient verification when choosing a counterparty and failure to complete the transaction by the counterparty. But only on the first link.

In this case, the dishonesty of counterparties of the second and subsequent links will have only indirect significance.

The tax service was forced to come to this conclusion by the latest practice of the Supreme Court of the Russian Federation (paragraphs 6-7 of the letter).

Position 1. If counterparties of the second and subsequent links have not paid taxes, this cannot become an independent basis for assessing additional taxes to the company ().

An example from practice: the inspectorate assessed additional taxes, but the company proved that the transactions were real. Relations between its counterparties and one-day companies should not create tax risks for the company

The plot of the case. The Moscow City management company has entered into agreements with two contractors to clean up the area and update the markings in the parking lot. Soon, an on-site tax audit took place, and inspectors assessed additional income tax and VAT to the company, as well as penalties and fines.

Inspectorate position. The transactions were only on paper, the counterparties did not conduct real activities and did not have the resources to execute the transactions. The management company did not exercise due diligence when selecting contractors. Counterparties were engaged in cashing out money through one-day companies that did not pay taxes.

Company position. The deals were executed. The completion of the work is confirmed by primary documents, witness statements, photographs and documents on the coordination of certain issues with the prefecture. At the same time, the heads of the counterparties confirmed their legal relationship with the company.

In addition, the counterparties are operating companies, have employees and perform similar work for other large companies, including under government contracts.

The court's conclusion. The inspectorate had no reason to charge additional taxes. The company acted lawfully and proved the reality of the transactions (ruling of the Supreme Court of the Russian Federation dated February 6, 2017 No. 305-KG16-14921 in case No. A40-120736/2015).

Position 2. If the supplier has not paid taxes, this in itself is not a reason to charge additional taxes to the audited company, which showed due diligence when choosing a counterparty. The main condition is that the deal must be real.

Contradictions in evidence of the movement of goods from the manufacturer to the company through a chain of transactions are also not grounds for assessing additional taxes. It is important that the parties do not refute the very fact of delivery (paragraph 31 of the Review of Judicial Practice of the Supreme Court of the Russian Federation No. 1 (2017), approved by the Presidium of the Supreme Court of the Russian Federation on February 16, 2017).

An example from practice: the inspectorate assessed additional taxes on a company because its counterparties had tax debts, and there were disagreements in the testimony of managers. The company challenged this decision

The plot of the case. The company bought coal. There was a chain of transactions from the coal producer to the company. Soon the on-site tax audit arrived. The company was brought to tax liability, and additional income tax and VAT were assessed.

Inspectorate position. The inspectors considered that the company received an unjustified tax benefit because it included in the costs the costs of a transaction with a company that did not have qualified personnel or production assets for the transaction.

The coal producer denied supply to the contractors named in the documents. In addition, counterparties of the first, second and other links did not pay taxes.

Company position. The company has evidence that it received the goods. In addition, before the transaction, she had information about how execution would occur. The price of the goods was the market price, the terms of the transaction were ordinary.

The inspection's decision was unlawful, since the company acted in good faith and showed due diligence and caution. The company should not have known about the violations of its counterparties. In this case, the tax benefit cannot be considered unjustified.

The court's conclusion. The inspection provided insufficient evidence of unjustified tax benefits. She did not prove the company’s involvement in the unjustified tax benefits received by its counterparties. Arguments about the tax debt of counterparties and contradictions in their testimony are not grounds for assessing additional taxes to the company. The main thing is that the transaction took place.

In such disputes, inspectors can prove that the company proceeded only from the commercial attractiveness of the transaction and did not evaluate the business reputation, solvency of the counterparty, the risk of non-fulfillment of its obligations, and the availability of resources.

The company, on the contrary, can explain why it chose this particular counterparty, prove its awareness of the forces with which the counterparty had to fulfill the agreement (ruling of the Supreme Court of the Russian Federation of November 29, 2016 No. 305-КК16-10399 in case No. A40-71125 /2015).

Now it is not enough for inspectors to prove the fact of forgery of signatures on primary documents and to obtain testimony from nominee directors about non-involvement in activities. This in itself does not indicate an unjustified tax benefit (paragraph 8 of the letter).

What will inspectors check now?

Inspectors will especially carefully check exactly what measures the company took when checking the counterparty. How sufficient and reasonable were they (paragraphs 9-10 of the letter). In particular:

1. evaluate why the company chose this particular counterparty;

2. determine whether the choice of counterparty differed from the business conditions and usual practice of the company itself;

3. find out how the company assessed:

• o terms of the transaction and their commercial attractiveness;
• o business reputation of the counterparty;
• o his solvency;
• o risk of non-fulfillment of obligations;
• o the counterparty has the necessary resources: equipment, specialists, relevant experience;

4. check whether the company has entered into transactions primarily with counterparties who do not pay taxes.

What inspectors will pay special attention to

Inspectors will be wary of the following (paragraph 11 of the letter):

1. there are no personal contacts of the counterparty’s officials;

2. there are no documents on the powers of the head of the counterparty, copies of his passport;

3. there is no information about the actual address of the counterparty, the address of its warehouses, production and retail space;

4. It is unknown how the company found out about the counterparty. There is no advertising of the counterparty in the media, recommendations of partners, the counterparty’s website, etc. In this case, they will take into account whether information is available about other market participants - competitors of the counterparty who offer goods at lower prices;

5. there is no information about the registration of the counterparty in the Unified State Register of Legal Entities;

6. there is no information about whether the counterparty has a license or SRO certificate, if the transaction requires this.

What to prepare for

During inspections, inspectors will request documents on how the company selected the counterparty (paragraph 12 of the letter):

1. results of searching and selecting a counterparty;

2. source of information about the counterparty: website, advertising materials, proposal for cooperation, information about the counterparty’s previous transactions;

3. results of monitoring the market for relevant goods, studying potential counterparties;

4. justification for the choice of a specific counterparty, drawn up on paper: a fixed procedure for monitoring the selection and risk assessment, the procedure for conducting a tender, etc.;

5. business correspondence.”

Alexander Sorokin answers,

Deputy Head of the Operational Control Department of the Federal Tax Service of Russia

“Cash payment systems should be used only in cases where the seller provides the buyer, including its employees, with a deferment or installment plan for payment for its goods, work, and services. It is these cases, according to the Federal Tax Service, that relate to the provision and repayment of a loan to pay for goods, work, and services. If an organization issues a cash loan, receives a repayment of such a loan, or itself receives and repays a loan, do not use the cash register. When exactly you need to punch a check, look at

Auditors often accuse the company of fictitious transactions. How can conscientious taxpayers prove that goods were actually delivered, work was performed, and services were provided? Indirect evidence will help here. See a selection of such arguments tested in arbitration practice.

How to prove the reality of procurement

To take into account the costs of purchasing goods, invoices and other standard procurement documents are no longer enough. Indirect arguments will help to convince controllers of the reliability of purchases (see Table 1).

How to prove the reality of the purchase (Table 1)

If the tax authorities prove that the purchase documents are unreliable, it will not be possible to challenge additional VAT charges. Judicial practice shows: if the disputed values ​​are subsequently sold or used in production, then purchase costs are also incurred. Therefore, they must be determined at market prices (Resolution of the Presidium of the Supreme Arbitration Court of the Russian Federation dated July 3, 2012 No. 2341/12). To show that prices for disputed goods (works, services) do not exceed market prices, it is worth preparing additional documents (see Table 2).

How to prove market prices

How to prove that prices correspond to market prices (Table 2)

The Federal Tax Service has long taken a course towards tightening its policy towards organizations that cooperate with companies that are unscrupulous in the opinion of the tax authorities. And these are not only one-day companies, but also long-registered companies that are not currently active and do not file reports. For choosing such business partners, taxpayers risk being accused of negligence, and this is followed by additional VAT charges, fines, penalties...

Sometimes companies manage to challenge these sanctions in court. Let's consider one of these cases. It is noteworthy that the taxpayer managed to defend the reality of transactions with dubious counterparties, although the head of one of them was in prison at the time of the operation.

The tax inspectorate, as a result of an on-site audit, came to the conclusion that the company did not actually conduct transactions with two of its counterparties. According to tax officials, they were carried out only on paper and were intended to create favorable tax conditions in the form of a VAT refund from the budget.

What arguments did the tax authorities give to prove their position?

Standard claims from the Federal Tax Service

According to tax inspectors, the company's counterparties could not fulfill their obligations under the contracts for the reason that they did not have sufficient production resources and labor. In addition, they were absent from their legal addresses, did not submit reports, and their current accounts were empty. The tax authorities requested documents from the companies that could confirm the reality of the disputed transactions, but did not receive them. Based on all this, the Federal Tax Service inspectors came to the conclusion that both counterparties are not conducting real activities.

However, the court in its decision indicated that all the above-mentioned circumstances in themselves cannot indicate the unreality of transactions between the company and these counterparties. The tax inspectorate did not provide convincing evidence of this, nor was it able to prove that the taxpayer under audit did not exercise caution when choosing contractors.

Company counter-arguments

Both counterparties were officially registered legal entities and were registered for tax purposes - the company took care to receive supporting documents. The court was presented with the charters of the counterparties and the decisions of their only participants on the establishment, certificates of state registration and tax registration, extracts from the Unified State Register of Legal Entities, orders for the appointment of managers and chief accountants with copies of the passports of these persons, a certificate of admission of one of the companies to hazardous construction work . All these documents, according to the court, indicate that the taxpayer exercised due diligence when choosing business partners.

In addition, the company presented a complete set of documents that were used to formalize both transactions, namely: contracts, invoices, acceptance certificates, certificates of the cost of work performed in the KS-3 form, invoices-12, payment orders and other documents.

If the CEO is serving a criminal sentence

Another argument from the tax authorities in favor of the fictitiousness of the contract with one of the contractors is that the general director of this company was in prison during the period of work. At the same time, there is no power of attorney to delegate the powers of the manager to another person. The general director of the contractor did not answer who carried out the operation contested by the Federal Tax Service on behalf of the organization.

However, the court did not take into account this argument of the tax authority. According to the arbitrators, this circumstance cannot mean that the controversial operation was not carried out. The counterparty contractor was registered long before its director received a criminal sentence, and the disputed contract was concluded under him. In addition, while the general director was in prison, the contractor was able to obtain permission to carry out certain types of construction work, opened current accounts and submitted reports to the Federal Tax Service. Moreover, all the documents necessary for these operations were signed personally by the director. This suggests that he continued to lead his organization even while serving a criminal sentence.

The court's decision

So, the Arbitration Court of the Central District, in its decision dated February 20, 2017 No. F10-5826/2016, canceled the decision of the Federal Tax Service to charge additional VAT to the taxpayer. In this case, the arbitrators referred to the position of the Constitutional Court of the Russian Federation, expressed in the ruling dated October 16, 2003 No. 329-O. The taxpayer cannot monitor the actions of the entire chain of counterparties and bear responsibility for their violations. In accordance with paragraph 3 of Article 7 of the Tax Code of the Russian Federation, in the field of tax legal relations there is a presumption of good faith. This means that the taxpayer is considered to be in good faith until the court establishes otherwise. But the tax inspectorate did not provide convincing evidence that the company being inspected fulfilled its obligations improperly.

Another legal position referred to by the judges is expressed in the resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation dated October 12, 2006 No. 53. The fact that the counterparty fulfills its tax obligations in bad faith cannot indicate that when working with it the taxpayer aimed to extract an unjustified tax benefit. This conclusion can be made if it is proven that the company should have known about the violations committed by its counterparty. However, the taxpayer documented that he took all necessary actions to ensure the integrity of his partners.