Tax Audit

What is it?

Tax systems in Central Africa are essentially declarative. Each tax payer determines by his own interpretation what the right amount of tax payable as per tax law. Once declaration is filed periodically or annually, tax office exercises its right to check to ascertain that basis, timing, rates, and regime applied are in compliance with the tax law. Otherwise tax is totally or partially catched up with penalties and interests.

What are the administrative tax audit types?

  • Full scope audit: It concerns all taxes in all accounting books, and tax reports over at least a year
  • Partial audit: it concerns selected taxes only, on specific accounts, or in all accounting books
  • Audit of declaration: it concerns the checking of yearly declaration of CIT return filed by tax payer to ascertain the coherence with other statements.
  • Spontaneous audit: it concerns checking of some assets of the tax payer.

What needs to be done?

Due to the possible impact of a tax assessment in terms of cash flow, suitable action/reaction must be undertaken

  • Check that tax audit procedures have been respected, and that law applicable is relevant
  • Prepare documentations and backup to justify its positions
  • Prepare answer to tax assessment notification
  • Hold meeting with tax office to seize the opportunity to explain and justify Its positions
  • Defend oneself by exploiting all internal, or external arguments that justify the positions taken

We do it

Our long experience in this matter is an asset. Obtaining positive results after a tax audit, work has to start in front, by anticipation. Anticipating also means knowing what are the main concerns and targets of the tax office, and taking appropriate measures. Also there is an absolute need of an internal tax audit or a tax review before filling a yearly tax return. This enables to highlight all the tax risk and consequently to mitigate the impact of assessment.