Tunisia

Taxable period

Under Tunisian law, both the accounting year and tax year follow the calendar year. However, derogation is possible if prior authorisation is obtained from the Ministry of Finance.

Tax returns

Tunisian-established companies have the obligation to file monthly tax returns, an annual CIT return, and an annual Employer’s Declaration.

Monthly tax returns include WHTs, VAT, LAT, social lodging tax, and professional training tax, and must be filed each month before the 28th day of the following month. Filing and payment take place simultaneously.

The annual tax return is the CIT return, which must be filed before 25 March of the following year. The deadline for filing the CIT return is moved to 25 June for public liability companies and private liability companies subject to statutory audit. Filing and payment take place simultaneously.

The Employer’s Declaration has to be filed each year before 30 April of the following year. This declaration must list all fees and salaries paid or incurred, even if not yet paid, to service suppliers and employees during the concerned year. No payment is due in connection with this filing, but fees not listed on this declaration are not recognised as deductible costs.

Payment of tax

CIT is paid through:

• WHTs applied on certain payments and operated by the debtor on behalf of the taxpaying entity.
• Beginning from the second year of activity, three provisional instalments, each calculated at 30% of the total CIT due for the previous year. The instalments fall due on 28 June, 28 September, and 28 December.
• An annual tax return.

Both WHTs and provisional payments of income tax are creditable against the annual/final tax due.

Filing and payment take place simultaneously.

The most common process is the filing in person at the tax office. In this case, payment is made in cash or by check.

However, companies with turnover exceeding TND 1 million are constrained to file their tax returns electronically. Electronic filing remains optional for other companies. In this case, payment is made through bank transfer.

Tax audit process

Tax auditors may proceed either with a spot tax audit (as provided by the Finance Law for 2022), a preliminary tax audit, or an in-depth tax audit.

Spot tax audit

The Finance Law for 2022 introduced a new category of tax audit, namely the 'spot tax audit'. This tax audit relates to the situation of the taxpayer for a period not exceeding one year. This verification cannot be carried out more than once a year, except at the request of the taxpayer. It may cover the whole situation of the taxpayer or one or more taxes. The prior notification of the spot tax audit should indicate, in particular, its nature and, if necessary, the operations or data concerned by the tax audit. The spot tax audit does not include transfer pricing.

The spot tax audit is subject to all the rules and procedures relating to the in-depth tax audit of the fiscal situation, subject to particular provisions.

A prior notice to the spot audit should be addressed to the taxpayer, 15 days at least before the beginning of the audit. The audit period is of 30 days in case the audit is carried out based on accounts maintained by the taxpayer and 60 days in other cases. The tax notification result should be notified to the taxpayer within 30 days from the beginning of the audit.

The taxpayer should answer the tax audit notification result within ten days from the day following the date of receipt of the notification, and the tax administration should answer to the taxpayer's opposition within ten days.

Once the taxpayer receives the answer of the tax authorities to the opposition to the notification, the taxpayer should file a second opposition within seven days from the day after the notification day in cases where the taxpayer still disagrees with some or all the points raised by the tax controllers.

Also, the taxpayer can request for the submission of the tax audit file before the conciliation commission within the same deadline of seven days. That commission shall express its opinion on the file before the tax assessment notice.

In cases where the tax administration agrees to the clarifications, explanations, arguments, and documents provided by the taxpayer, then the tax audit will be closed. However, in cases where the tax administration still disagrees with some or all the evidence provided by the taxpayer or in cases where the taxpayer will not reply to the tax administration notification of the tax audit results or to the tax authorities answer to the opposition in the deadlines as detailed above, then the taxpayer will receive a tax assessment notice in a maximum period of 12 months as from the date of the notification of the tax audit results and will have to pay the notified taxes.

Preliminary tax audit

In case of a preliminary tax audit, the taxpayer under control is not notified prior to starting the audit. However, the tax authority has the obligation to send an information request concerning the tax findings. The taxpayer has to reply within 20 days.

The tax audit is conducted in the offices of the tax administration and deals with the documents made available to them (tax returns, registered contracts, etc.). However, preliminary tax audits can never deal with the taxpayer’s accounts.

The results of the tax control are notified in writing to the taxpayer within a tax audit report, whereby the outcome of the audit activity must be detailed and the findings, if any, must be illustrated and motivated. The tax report is to be notified to the taxpayer within 90 days from the expiry date to reply to the information request (see above).

Indeed, the taxpayer has the possibility to answer to the tax audit report within 45 days starting from the day following the date of receipt of the report. Failing that, the taxpayer will receive a tax assessment notice in a maximum period of 30 months as from the tax audit results notification, that brings forth requests for payment of taxes and penalties to the taxpayer. In cases where the taxpayer answers to the notification of the results of the tax audit and brings additional explanations, clarifications, and documents to the tax auditors, they will be constrained to examine the evidence provided by the taxpayer and answer to the taxpayer's opposition within 90 days (as per the Finance Law for 2021) from the day following the notification date.

Once the taxpayer receives the answer of the tax authorities to the taxpayer's opposition, the taxpayer will have the possibility to file a second opposition within 15 days from the day after the notification day in cases where the taxpayer still disagrees with some or all the points raised by the tax controllers.

Also, the taxpayer can request for the submission of the tax audit file before the conciliation commission within the same deadline of 15 days. That commission shall express its opinion on the file before the tax assessment notice.

In cases where the tax administration agrees to the clarifications, explanations, arguments, and documents provided by the taxpayer, then the tax audit will be closed. However, in cases where the tax administration still disagrees with some or all the evidence provided by the taxpayer or in cases where the taxpayer will not reply to the tax administration notification of the tax audit results or to the tax authorities answer to his opposition in the deadlines as detailed above, then the taxpayer will receive a tax assessment notice in a maximum period of 30 months as from the date of the notification of the tax audit results and will have to pay the notified taxes (the tax assessment notice execution is interrupted by the payment of 10% or through a bank guarantee of 15% of the amounts due excluding amounts related to WHT and some administrative tax fines defined by the law that shall be paid at 100%). It should be noted that the Finance Law for 2020 provided that, in case a tax assessment notice is due to a default of submission of tax returns or acts required for the payment of taxes, the tax assessment notice execution is interrupted by the payment of 20% of the principal tax amount (excluding always amounts related to WHT and some administrative tax fines defined by the law that shall be paid at 100%). The tax assessment notice shall take into consideration the taxpayer’s observations enclosed in the first and the second opposition filed by the taxpayer.

Further to the receipt of the tax assessment notice, the taxpayer may make an appeal to the relevant court.

A preliminary tax audit does not prevent an in-depth tax audit of the same period and the same taxes.

In-depth tax audit

In case of an in-depth tax audit, the taxpayer under control is notified 15 days prior to starting the audit. This period may be extended to a maximum period of 60 days.

In-depth tax audits deal with the accounts of the taxpayer under control (in cases where the taxpayer has the obligation to maintain accounts according to the accounting legislation into force) as well as any other evidence (presumptions, registered contracts, etc.).

In-depth tax audits take place, as a general rule, on the business premises of the taxpayer. However, and upon the request of the taxpayer or the tax controllers, the tax audit can be conducted in the tax authorities’ office. In this case, books, records, and any other documentation deemed necessary to the tax auditors to complete the audit have to be moved to the tax auditors’ office.

In-depth tax audits last for:

• six months, in case the taxpayer under control is constrained by the law to maintain accounts, and
• one year, in the other cases.

At the end of this period, the tax audit must come to an end and the tax auditors must draw up a tax audit report to be sent to the taxpayer, whereby the outcome of the audit activity must be detailed and the findings, if any, must be illustrated and motivated.

Once the tax audit report is sent to the taxpayer, the procedure of response and deadlines are the same as for preliminary tax audits.

Statute of limitations

The period open for tax audit, unless it was subject to a previous in-depth tax audit, is:

• Four years in case of partial omission; an omission is considered as partial in cases where the tax return is filed but the taxable base is not determined properly or in cases where the WHT rates applied to payments made to third parties are lower than the rates provided by the law.
• Ten years in case of total omission; an omission is considered as total in cases where the tax return is not filed at the date when the company becomes under tax control.
• Six years in case omissions, errors, and dissimulations on tax bases, rates, or tax liquidation are related to taxes declared which amounts do not exceed the following:
  • TND 200 for companies.
  • TND 100 for individuals subject to PIT according to the real regime or subject to PIT according to the flat-rate regime under the BNC (flat rate).
  • TND 50 for individuals subject to PIT under BICs according to the flat-rate regime (flat tax).
  • TND 25 in other cases.

The four-year period and the ten-year period begin to run from 1 January (in cases where the fiscal year coincides with the calendar year) of the year following the completion of sales, earnings, receipt, or disbursement of any sum to be taxed.

Topics of focus for tax authorities

The tax authorities primarily focus on extraordinary transactions (e.g. mergers, restructuring, suspension of business).

Further to the recent changes related to transfer pricing provision, the tax authorities are increasing their attention towards transactions concluded between affiliated companies.