The necessity to appeal a Tax Notice-Decision typically arises after a tax authority conducts an audit. Previously, certain types of tax audits were subject to a moratorium, but as of early 2024, active tax audits of taxpayers have resumed. Therefore, if you are reading this page, you have most likely encountered a tax audit and its consequences in the form of a corresponding decision by the tax authority.
According to current legislation, a Tax Notice-Decision must specify the amounts of financial obligations and penalties accrued based on the results of the audit.
If you disagree with the findings of the tax authority outlined in the audit report or with the amounts of obligations and penalties, you have the right to appeal the Tax Notice-Decision in Kyiv or another city, either administratively or judicially, regardless of whether you are an individual entrepreneur (IE) or a legal entity.
The administrative procedure for appealing a Tax Notice-Decision involves submitting a complaint against the tax authority’s decision to a higher-level supervisory body.
Judicial appeal of a Tax Notice-Decision entails filing a lawsuit with the appropriate administrative court to have the tax authority’s decision declared unlawful and annulled.
Currently, businesses in Kyiv and Kyiv Oblast must file such lawsuits with the Kyiv District Administrative Court.
A claim to annul a Tax Notice-Decision in Dnipro is filed with the Dnipropetrovsk District Administrative Court.
It is important to note that taxpayers are not required to pay the amounts of obligations assessed by the tax authority while the Tax Notice-Decision appeal process is ongoing. Such obligations are considered unsettled, and liability for non-payment does not arise. Therefore, timely filing of a complaint or lawsuit against a Tax Notice-Decision is crucial.
The deadline for judicial appeal against Tax Notice-Decision depend on the chosen procedure and other circumstances. For example, an administrative complaint against a Tax Notice-Decision must be filed within ten days of receiving it.
The deadline for judicial appeal of a Tax Notice-Decision depends on whether a prior administrative complaint was filed. If an administrative complaint was filed but did not yield the desired result, a lawsuit to annul the Tax Notice-Decision must be filed within one month of the complaint’s review and receipt of the decision. If no administrative complaint was filed, the Tax Notice-Decision can be judicially appealed within three months of receiving it.
It is essential to emphasize that the aforementioned deadlines for filing a lawsuit to annul a Tax Notice-Decision are the maximum allowed. However, it is preferable to file a lawsuit within ten days of receiving the Tax Notice-Decision or the decision resulting from the complaint. This ensures that the tax obligation assessed as a result of the audit will undoubtedly not be considered settled, fully protecting the taxpayer from the risks of tax debt and subsequent asset seizure.
Thus, proper and prompt appeal against a tax authority’s decision following an audit is key to ensuring stable business operations and relief from unjustified tax obligations. At the same time, as can be seen, filing a complaint against a Tax Notice-Decision or a lawsuit requires deep and detailed knowledge of tax law and administrative judicial procedures.
The tax attorneys at WINNERLEX Law Firm have extensive experience in defending the rights and interests of taxpayers against unjustified TNDs resulting from tax audits.
Upon a client’s request, the attorneys at WINNERLEX will:
- Conduct a prompt analysis of the Tax Notice-Decision, the audit report, and primary documentation;
- Assess the prospects of annulling the Tax Notice-Decision;
- Determine the optimal timelines, procedure, and stages of appeal;
- Provide a detailed consultation on the best procedure and timelines for appeal;
- Draft a complaint to the higher-level tax authority;
- Provide comprehensive representation in administrative court, from drafting and filing the claim to participating in court hearings and obtaining a judicial decision.
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Practice experience: 11 years Specialization: support of economic, civil, labor and administrative disputes, inspections
If a taxpayer or their legal representatives refuse to sign or receive the audit report (or certificate), or if delivery and signing are impossible due to the absence of such individuals at their registered address, officials of the supervisory authority prepare a corresponding act certifying these facts. Refusal to sign the audit report or receive a copy does not exempt the taxpayer from the obligation to pay the monetary obligations determined by the supervisory authority based on the audit results.
If a taxpayer, in their complaint or objection, refers to circumstances that were not examined during the audit and cannot be objectively reviewed without conducting an additional audit, the State Fiscal Service of Ukraine may issue an order to conduct an unscheduled audit on the issues under dispute.
It is crucial to adhere to the established deadlines for submitting objections to the audit report or a complaint against the Tax Notice-Decision. The Tax Code does not allow the submission of documents beyond the permitted timeframes.
When submitting objections directly to the office of the supervisory authority, it is necessary to obtain a receipt mark on the second copy of the objections. If the objections are sent by mail, the documents must be sent as a registered letter with an inventory of the contents and a delivery confirmation.
The timeframe for submitting objections and/or additional documents is 10 working days from the day following the receipt of the audit report (or certificate). Objections should be submitted to the supervisory authority that conducted the audit. The review period for objections is 7 working days from the day they are received (or from the completion of an additional audit conducted to clarify circumstances not previously examined and highlighted in the objections).
To appeal a Tax Notice-Decision, an application should be filed with an administrative court. The claimant (i.e., the business entity challenging the Tax Notice-Decision) can choose between: The administrative court in the claimant’s location (residence or registered address); The administrative court in the location of the respondent (i.e., the State Tax Service office that issued the Tax Notice-Decision).
Addresses and contact details of administrative courts can be found on the official website of the Judiciary of Ukraine.
To file a claim with an administrative court, refer to Article 122 of the Code of Administrative Proceedings of Ukraine, which stipulates a six-month period for seeking judicial protection of rights, freedoms, and interests. This period is calculated from the day the individual became aware, or should have become aware, of their rights being violated.
However, Part 3 of Article 122 allows for alternative timeframes established by other laws. In the field of taxation, such provisions are outlined in the Tax Code of Ukraine. According to Paragraph 56.19 of the Tax Code, a taxpayer has the right to appeal a Tax Notice-Decision or any other decision of the State Tax Service in court at any time after receiving such a decision, within the limitation period specified in Article 102 of the Tax Code (i.e., within 1,095 days). The 1,095-day limitation period is calculated from the date the taxpayer received the contested Tax Notice-Decision.
