The fiscal year is the calendar year.
The tax system operates on the basis of self-assessment, with subsequent inspection by the tax authorities.
Tax filing deadlines begin on 9 April and continue up to 28 April. The tax return due dates are determined by the ninth digit of the company’s Tax Identification Number (TIN) and taxpayer classification defined by the tax authority.
Payment of tax
Local tax authorities have established that for CIT purposes, and its pre-payments, companies are obligated to follow IFRS accounting principles.
In general terms, most companies are required to keep accounting records and are allowed to make voluntary CIT prepayments based on the following calculation: 50% of the previous year CIT due less income tax withholding applied in such fiscal year.
The final CIT payment is due between 9 April and 28 April.
Tax audit process
In general terms, tax authorities look at the consistency of the information delivered by the taxpayers and information reported by third parties. Tax authorities can issue communications in order to require explanations on any detected inconsistency. Additionally, accounting inspections can be performed.
Statute of limitations
Fiscal authorities have three years from the date of filing to start proceedings for tax audits or assessment and collection of taxes.
The statute of limitations is extended from three to six years if the corresponding tax returns have not been filed or are incompletely filed. A tax audit can be reopened, verified, or amended within one year from the date of completion.
Topics of focus for tax authorities
Tax authorities usually focus on substance, formal compliance requirements, and consistency of information filed.