If you received a letter from the tax office demanding the submission of explanations, this means that the tax authorities did not like something in the statements you submitted. The fact is that the Inspectorate of the Federal Tax Service conducts a desk audit of all received declarations and financial statements in an automatic mode. And if errors are detected in the reporting (contradictions between the information in the submitted documents, discrepancies between the information submitted and the information that the tax authority has), the IFTS will require appropriate explanations (clause 3 of article 88 of the Tax Code of the Russian Federation).
In addition, the tax authorities have the right to request clarifications during a desk audit of the declaration in which the losses are declared. And, as a rule, explanations are indeed requested for each such declaration.
If you have submitted a revised declaration, in which the amount of tax payable to the budget has been reduced in comparison with the amount declared in the initial declaration, then the tax authorities have the right to request explanations justifying the change in indicators (clause 3 of article 88 of the Tax Code of the Russian Federation).
Explanations during the office audit
To submit explanations, you have 5 working days from the date of receipt of the request from the tax office (clause 3 of article 88 of the Tax Code of the Russian Federation). If you do not provide explanations, then you face a fine of 5,000 rubles. (Clause 1 of Article 129.1 of the Tax Code of the Russian Federation).
If you decide that there are errors in the statements you submitted, instead of explanations, you can submit an updated tax return (calculation). And in this case, of course, there will be no penalty for not submitting explanations.
You can submit explanations to the tax office:
- or by handing over in person through the office;
- or by sending it by mail with a list of attachments;
- or by sending by TCS.
As for the explanations for VAT, if you are required to submit a declaration for this tax in electronic form, you must also submit the explanations exclusively electronically - tax authorities will not take into account explanations on paper (clause 3 of article 88 of the Tax Code of the Russian Federation).
How to correctly write an explanation to the tax
Explanations in the Federal Tax Service Inspectorate are drawn up in any form, with the exception of explanations during a desk check of the VAT declaration (you will read about this below).
If, in your opinion, there are no errors, inaccuracies and contradictions in the submitted reporting, then indicate in the explanations:
“In response to the demand from XX.XX.XXXX No. XX, we inform you that there are no errors in the declaration for such and such a tax for such and such a period. In this regard, there are no grounds for making corrections to the declaration for the specified period. "
If you find that you really made a mistake in the submitted declaration, but this error does not entail an understatement of tax (for example, a technical error when specifying any code), then in response to the tax authorities' request to provide explanations, you can:
- or indicate in the explanations that they made a mistake, that the correct option is such and such, but such an error did not lead to an underestimation of the tax base or the amount of tax payable;
- or submit an updated declaration.
But if there is an error in the declaration that entails an understatement of tax, you need to submit the revised declaration as soon as possible. It is pointless to hand over explanations in this situation (clause 1 of article 81 of the Tax Code of the Russian Federation; Letter of the Federal Tax Service dated 06.11.2015 No. ED-4-15 / 19395).
Explanation of tax loss
The attention of the tax authorities will be attracted by losses incurred over 2 years or more. In response to a request about the causes of losses, you can send a letter of explanation to the tax office, explaining in it why expenses exceed income. For example, an organization is recently registered, there are still few clients, but the cost of renting premises, maintaining staff, etc. are already significant. In the explanations, emphasize that all costs are economically justified and documented. You can prepare a table showing the main types of expenses and their amount for the year by type. Below is an explanatory note to the tax authority for losses (sample).
Explanation to the tax office about discrepancies in declarations
Tax authorities can compare the data of one declaration (for example, for VAT) with the data of another declaration (for example, for income tax) or with accounting statements. And ask to explain the reason for the discrepancy between similar indicators (in particular, revenue).
It is easy to justify such discrepancies. After all, the accounting rules are different from the tax accounting rules. And the procedure for determining the tax base for different taxes has its own characteristics.
For example, the tax base for VAT may not coincide with the amount of income in the profit declaration, since some non-operating income is not subject to VAT (penalties, dividends, exchange rate differences) (Article 250 of the Tax Code of the Russian Federation).
Explanation in the Federal Tax Service Inspectorate for VAT
The presentation of explanations to the Tax Inspectorate for VAT has its own characteristics. As we have already noted, explanations on VAT must be submitted in electronic form, if the payer is obliged to submit an electronic declaration (clause 3 of article 88 of the Tax Code of the Russian Federation). In addition, these explanations must be submitted in accordance with the approved format (approved by the Order of the Federal Tax Service dated 16.12.2016 N ММВ-7-15 / [email protected]). And if the payer submitted explanations in electronic form, but in the wrong format, then he was threatened with a fine (clause 1 of article 129.1 of the Tax Code of the Russian Federation). True, in September 2017 the FTS made a decision (Decision of the FTS dated 13.09.2017 No. SA-4-9 / [email protected]), which states that the payer should not be fined for the incorrect format of the explanations.
If you have the right to submit a VAT return on paper, then it is more convenient to give explanations according to the forms developed by the Federal Tax Service (Appendix 2.1-2.9 to the Letter of the Federal Tax Service of July 16, 2013 No. AS-4-2 / 12705). But the use of these forms is a right, not an obligation.
If necessary, you can attach copies of individual invoices, extracts from sales and purchase books to the explanations.
Tax burden: explanation
If the tax authorities ask you for explanations due to the fact that you have a low tax burden compared to the industry average, then you can answer them something like this:
“In the declaration for such and such a tax for such and such a period, an incomplete reflection of information or errors that would lead to an underestimation of the tax base was not allowed. In this regard, the organization has no obligation to clarify tax liabilities for the specified period.
As for the tax burden on the main activity of the organization, then its decrease in such and such a period is caused by the following circumstances: a decrease in income and an increase in the organization's expenses ”.
And then state how much the amount of revenue has decreased and expenses have increased for the requested period in comparison with previous periods. And what caused it (decrease in the number of the buyer, increase in purchase prices, etc.).
More details about the explanations requested by the tax authorities in connection with the reduction of the tax burden, we talked about in a separate section, where we also provided a sample of the design of the relevant explanations.
In the course of a desk audit of the VAT declaration, the Federal Tax Service has the right to require the taxpayer to clarify the data reflected in the document. In the article, we will tell you how to correctly draw up an explanation to the tax office for VAT and submit it to the Federal Tax Service, as well as analyze common mistakes and answer questions on the topic.
When the FTS may require clarifications on VAT
The conditions under which the FTS has the right to request clarifications on the VAT return from the payer are enshrined in the current legislative acts. Also, regulatory documents regulate the procedure, terms and form for providing a response to a request.
Legislative acts on the topic
The table below shows the normative documents that establish the rules for filing and responding to requirements.
| P / p No. | Normative document | Description |
| 1 | Tax Code (clause 3 of article 88) | The right of employees of the Federal Tax Service to demand an explanation of VAT from the payer is enshrined in the provisions of the Tax Code. According to the document, tax authorities can send a request for clarifications if discrepancies and contradictions are revealed during a desk audit of the declaration. |
| 2 | FTS order No. ММВ-7-2 / 189 dated 08.05.15 | The document approves the form in which the tax authorities send a request to the taxpayer. According to the order, the Federal Tax Service sends a request in electronic form via telecommunication networks. |
| 3 | FTS order No. ММВ-7-2 / 149 dated 15.04.15 | According to the order, the Federal Tax Service can send a request during a desk audit immediately upon detection of discrepancies / contradictions. |
| 4 | ФЗ-130 dated 05/01/17 | Federal law approves requirements regarding the form of providing explanations. From 01.01.17, the response to the request must be provided only in electronic form. |
| 5 | Letter of the Federal Tax Service No. EED-4-15 / 5752 dated 04/07/15 | In the letter, the Federal Tax Service approves the electronic format of the explanations on the following topics:
|
Top reasons for asking for clarification
As you can see, the tax authorities have the right to request clarifications only in specific cases - when discrepancies, errors, inaccuracies in the information specified in the declaration are detected. In practice, tax authorities ask for clarifications in the following situations:
- Revealed arithmetic errors in the calculations of the amounts of tax indicated in the declaration.
If the amount of income, expenses, tax payable is incorrectly indicated in the declaration, and the error was made as a result of arithmetic calculations, then the FTS has the right to request clarifications in the prescribed manner. Read also the article: → "". - Discrepancies were found between the indicators reflected in the declaration and the amounts indicated in the supporting documents.
Another common reason for requests is discrepancies between the declaration data and supporting documents. Some of the information is not included in the sales / purchase book, the transaction amount indicated in the declaration is understated compared to the invoice - all these facts are grounds for requesting clarifications. - Discrepancies in the fact of cross-checking were revealed.
If discrepancies are revealed as a result of comparing the declarations of the taxpayer and counterparties, as well as on the fact of cross-checking of supporting documents, then the FTS has the right to demand clarification in the prescribed manner. - The payer has submitted a revised declaration, the amount of tax in which is reduced in comparison with the originally submitted documents. The tax officer has the right to request explanations with the calculation and documents, on the basis of which the payer has reduced the amount of tax liabilities.
In addition to explanations of the VAT declaration, tax authorities often give requests for clarification of the data specified in the income tax declaration.
As in the situation with VAT, in the case of submission of a "revision" with the amount of tax downward, the FTS has the right to request explanations and documents. In addition, the authorities of the Federal Tax Service request justifications in the event of filing a "loss-making" declaration. For the sake of fairness, we note: if you filed a "clarification" with a tax reduction or submitted a declaration with losses, then the Federal Tax Service will ask you for an explanation in almost 100% of cases. The actions of the Federal Tax Service in such situations can be easily explained.
Firstly, losses reflected in the tax return can be fictitious in order to reduce tax liabilities. Therefore, the fiscal service has every reason to request documents confirming income and expenses, as well as request a written explanation from the payer. As for the "clarification" that reduces the tax, the tax authorities in this situation also have the right to receive written justifications and documents.
Step 1. Acceptance of a claim from the Federal Tax Service
The first step in the procedure for drawing up and sending an explanation is to receive a request from the Federal Tax Service. According to regulatory documents, the tax authorities send the request electronically via telecommunication channels. The fact of acceptance of the claim is confirmed by a receipt, which the taxpayer sends in response to a request from the Federal Tax Service.
Be careful: you must accept the request and send the receipt no later than 6 business days from the date of receipt. That is, if you received a request on 07/17/17 (Monday), then you must accept it and send a response receipt no later than next Monday (07/24/17). In case of delay, the FTS has every reason to block the organization's bank accounts and prohibit transfers of funds in any form.
Step 2. Clarifying the error code
According to the current legislation, the requirement of the FTS is sent to the taxpayer with the code of the detected error. The code is assigned in accordance with the following classification:
- If you find discrepancies with counterparties, indicate the error code "1". A similar classification is applied to errors if:
- the counterparty did not indicate the entry you reflected in the declaration;
- the partner has submitted a "zero" declaration, while you have provided data on the availability of transactions with the counterparty;
- the supplier / buyer did not submit a declaration, so there is no way to compare the data.
- Discrepancies between sections 2 and 3 of the declaration are classified under code “2”.
- If the FTS revealed a discrepancy between the data specified in sections 10 and 11 of the declaration, then the payer will be sent a claim with the code "3". As a rule, errors with code "3" are associated with reflection of intermediary transactions.
- If the FTS has identified another error that is not subject to the above classification, the request will be sent with the code “4”. In this case, the line number in which the discrepancy was found will be indicated in brackets.
Step 3. Study of documents and calculations related to the requirement.
After receiving the request and sending the receipt, study the text of the requirement, and then proceed to the analysis of documents and calculations that led to errors and discrepancies. Depending on the text of the request and the specified code, the following actions are possible on the part of the taxpayer:
- If the FTS has identified arithmetic errors in determining the amount of tax, it is necessary to conduct an additional recalculation of the amounts in order to confirm the error.
- Let's say the tax authorities have identified discrepancies with counterparties. In this case, the first step will be to request a reconciliation act, the data of which must be compared with the primary documents issued by the counterparty and received from him. Based on the reconciliation, you can either identify your own mistakes, or discover the partner's inaccuracies (the invoice was issued incorrectly, the amount of the transaction in the accounting does not correspond to the primary documents, etc.).
- One of the most common reasons for a request is a discrepancy in the declaration data (information from the purchase book and the sales book). To clarify the reasons for the discrepancies, you will need to raise the primary documentation and check the correctness of the data entry. The reason for the discrepancies may be the incorrectly entered amount according to the document (the amount on the account does not correspond to the data specified in the declaration) or the lack of information on any operation (the invoice data is not included in the declaration).
Step 4. Composing a response to the request.
After the cause of the error has been identified, compose a response to the request in any form, indicating the required details (data from the Federal Tax Service, the name and address of the payer). In the explanatory text, provide a clear and concise answer regarding the reasons for the discrepancies. Support the facts specified in the explanation with documents (in the text it is advisable to indicate the numbers of invoices, reconciliation statements, etc.).
Below is an example of a completed explanation.
Head of the Inspectorate of the Federal Tax Service of the Russian Federation No. 34
Tula Sviridov S.D.
from LLC "Karnaval"
TIN 8574123654
PPC 412536874
Legal address:
Tula, st. Sadovaya, 4
account 741368451284125
in the Bank "Capital"
Correspondent account 854168451284133
BIK 884411856.
Ref. No. 18-5 of 17.07.17
on in. No. 74 / 5-15 of 12.07.17
ANSWERING A REQUEST
on the provision of clarifications
In response to the request for an explanation of the VAT declaration for the 2nd quarter. 2017, we report the following:
the discrepancy revealed in the amount of 124.330 rubles., due to non-operating income received by LLC "Karnaval" in the 2nd quarter. 2017, including:
- 000 rub. - overdue accounts payable including VAT;
- 330 RUB - interest on loans issued.
The amount of non-operating income (124.330 rubles) is reflected in the income tax declaration for the 2nd quarter. 2017 (Appendix 1 to sheet 02, line 100). According to the Tax Code (clause 3 of article 149, clause 1 of article 146), this amount is not taken into account when calculating the taxable base of VAT, therefore, the amount is not reflected in the VAT declaration.
General Director of LLC "Karnaval" ______________ Serpukhov D.K.
Step 5. Transfer of the explanation to the Federal Tax Service.
After the explanation has been drawn up, the answer should be transmitted to the Federal Tax Service. Due to changes in legislation, from 01.01.17 the response to the request is transmitted only in electronic form via telecommunication networks. That is, if you received a request after 01/01/17, then you can send the answer to it only in electronic format through a special communication operator. An explanation must be sent no later than 5 days from the moment you sent the receipt of its receipt.
Responsibility for Failure to Provide an Explanation
Changes in the legislation affected not only the format for providing explanations of the discrepancies discovered during the in-house audit, but also the liability provided for violation of the procedure for providing a response. So, if you violated the deadline for submitting a response (5 days from the date of sending the receipt), then in this situation a fine of 5.000 rubles is provided. If the order is violated again during the year, then the amount of the fine increases to 20,000 rubles.
The fine will be levied both in the case of a delay in the submission of an explanation, or in a situation where the answer is not provided at all.
Common compilation mistakes
Below we will consider the most common mistakes made when drawing up an explanation for a VAT return.
Mistake # 1. The answer is provided on paper.
Before the entry into force of the legislative changes, that is, before 01.01.17, the payer could choose the form of providing a response to the request - electronic or paper. After 01.01.17, the Federal Tax Service accepts only electronic replies, the explanations provided on the papers are considered invalid.
Mistake # 2. The deadline for providing a response expires 5 days after it was sent to the Federal Tax Service.
The point of the report of the period for providing a response is the day of acceptance of the request (the day of sending the receipt). That is, from the moment the FTS sends a request, the payer is given a maximum of 11 working days to accept it, as well as to compose and send a response: 6 days - receipt of the request plus 5 days - sending an explanation.
Mistake number 3. The FTS sends requests within 30 days from the date of filing the declaration.
Heading "Question - Answer"
Question number 1. Satellite LLC received a request to clarify the errors that led to the underestimation of the VAT tax base. After reconciliation of documents and recalculations carried out by Satellite, the existence of an error was confirmed, that is, the company really underestimated the amount of tax payable. How does Satellite need to adjust the tax amount? What is the correct answer to a request?
In this case, Satellite must submit a revised tax return indicating the correct amount of tax to be paid. You do not need to provide an explanation for the requirement. The deadline for submission of the "clarification" is 5 days from the date of sending the receipt for the receipt of the request.
Question number 2. During the inspection, the FTS revealed discrepancies between the data in the declaration of OOO Kurs with the information specified by the counterparty. 07/12/17 A request was sent to the "Course". In the course of studying the documents, the accountant of the "Course" revealed that the invoice indicated in the declaration of the counterparty was not actually issued by the "Course" (there is no operation). How can the "Course" accountant compose the correct answer to the request?
The fact of an unconfirmed transaction must be reflected in the table, the form of which is approved by the order of the Federal Tax Service (ММВ-7-2 / 189 dated 05/08/15). The table should indicate the amount of the transaction that is not confirmed, the counterparty data (TIN), the date and invoice number.
Today, some institutions have to deal with the need to provide an explanation to the tax structures after any inspection or reporting. In order for the explanations not to provoke additional checks by the supervisory authority, the execution of the explanation must be taken very seriously, with full responsibility and not delayed with the answer.
What are the current requirements
As a rule, the requirement to provide explanations arises after a certain period after the reports or declarations, and the reason for the request may be any erroneous record or inaccuracy in the reporting. Quite often, supervisory structures have questions about reporting to VAT refunds, in case of inconsistency in the reports of counterparties, due to inconsistencies in taxation data in income tax returns. Also, questions may arise as a result of unjustified losses of the enterprise during the audit, when sending a revised declaration or in the tax reporting, in which the tax amount is shown to be less than in the initial information, etc.
For example, for VAT, there are 3 main types of requirements for writing explanations, a sample of which is developed and approved in electronic form by the regulations of the Federal Tax Service:
- By control compliance
- On disagreements with counterparties
- About unrecorded information in the sales journal (letter of the Federal Tax Service No. ED-4-15 / 5752 dated 07.04.2015).
Requirements for explanations after VAT declarations may arise for other reasons, but the tax authorities have not yet developed a sample document.
To send a response, the payer has 6 working days to send a message on receipt of the request, plus another 5 working days to send a response to the request (weekends and holidays are not taken into account).
How to write tax clarifications in 2019
If the payer received a request from the tax service for an explanation, then the inspectorate found something suspicious in the payer's declaration. It should be noted that the Inspectorate of the Federal Tax Service provides a desk control of all declarations and reports of the accounting department using an automatic electronic program that can quickly identify errors in reporting (discrepancies between the data in the reports, inconsistencies between the submitted declaration and the information available to the assigned inspector), as a result of this, the IFTS submits a request for an explanation of such a fact (clause 3 of article 88 of the Tax Code of the Russian Federation). There may be other reasons for submitting an Explanation Request.
The explanatory one in the IFTS is issued in a free form, except for explanations during the in-house audit of the VAT declaration. If the payer believes that there are no inaccuracies and inconsistencies in the sent report, then this should be indicated in the explanation for the claim:
« ... In response to your request No. 75 dated 02.03.2019, we report that there are no inaccuracies in the tax return for the requested time. Based on this, we consider it unacceptable to make corrections to the reporting for the specified time ...».
If you find an error in the reporting that does not entail a tax reduction (for example, a technical inaccuracy when displaying some code), you can explain what error was made, indicate the correct code and provide evidence that this inaccuracy did not lead to a decrease in the amount of tax paid or send an updated declaration.
However, if an inaccuracy is found that has led to a tax reduction, you must immediately send an updated tax return. Under such circumstances, it makes no sense to give explanations (clause 1 of article 81 of the Tax Code of the Russian Federation; Letter of the Federal Tax Service No. ED-4-15 / 19395 dated 06.11.2015).
Each taxpayer is obliged to know that the legislation does not provide for, that explanations must be submitted only in writing, i.e. this suggests that explanations can be provided orally, however, in order to avoid any misunderstandings, it is better to compose a written answer.
Explanation of tax loss
When checking unprofitable enterprises, the tax service carefully examines whether income taxes are understated. The period of the audit is carried out over the past two years or more. When a taxpayer receives a request for an explanation of the reason for losses, it is necessary to promptly send a response to the supervisory service, which explains in detail why the costs are higher than income. For example, you can refer to the fact that the company was established recently, there is still a small clientele, and the costs of renting a building and maintaining employees are large, etc. In response, it is necessary to pay attention to the fact that all costs are documented and the reporting is correct. For greater clarity, you can create a table displaying a list of costs for the year in the context of operations.
Download an explanatory note to the tax on losses
(Video: "We draw up explanations of losses in response to the request of the tax authority")
Explanation to the tax office about discrepancies in declarations
Supervisory structures check all declarations using automatic programs, and they can very quickly find a discrepancy between information in one declaration (for example, for VAT) with information on another (for example, for income tax) or with an accounting report. In this case, the inspectorate is forced to turn to the payer with a requirement to explain the reason for the discrepancy between indicators (for example, revenue).
Considering that accounting in institutions is not conducted in the same order as accounting in the supervisory service, it is not difficult to explain the revealed discrepancies. For example, tax data on VAT may not coincide with the amount of profit, since there are non-sales income that is not subject to VAT (fines, dividends, exchange rate differences). This circumstance may be the reason for discrepancies, which should be written about in the response to the request. (Article 250 of the Tax Code of the Russian Federation).
Explanation in the Federal Tax Service Inspectorate for VAT
When drawing up explanations in the Federal Tax Service Inspectorate for VAT, it should be borne in mind that there are some nuances here. As noted earlier, payers are required to submit a declaration in electronic form (clause 3 of article 88 of the Tax Code of the Russian Federation), therefore, institutions must submit their explanations for VAT in electronic form. In this case, explanations must be submitted according to the accepted template (Pr. FTS N ММВ-7-15 / [email protected] 2016) and if the institution has submitted electronic explanations not in the required template, then it can be fined (clause 1 of article 129.1 of the Tax Code of the Russian Federation). However, in September 2017, the Federal Tax Service issued Resolution No. SA-4-9 / [email protected]) dated 09/13/2017, where the fine to the payer was canceled for an incorrect sample of explanations.
If the company has the right to file a VAT return in paper form, then it is better to provide explanations according to the samples adopted by the Federal Tax Service (Appendices 2.1-2.9 to the letter of the Federal Tax Service No. АС-4-2 / 12705 dated July 16, 2013). It should be noted, however, that the use of these samples is optional.
For greater reliability of the explanation, you can attach copies of invoices, extracts from sales and purchase journals.
If the inspector asks the enterprise to explain the low tax burden compared to the industry average, then this circumstance can be explained as follows:
“... In the declaration on the required reporting for the requested time, the incomplete display of information that would lead to a decrease in tax payments was not allowed. Therefore, the company believes that the clarification of the tax return for the specified time is not required. The tax burden on the main activities of the institution was reduced at the indicated time due to the decrease in income and increase in the costs of the institution ...».
And then you need to set out the value of the decrease in the amount of proceeds and the increase in expenses for the requested time compared to the previous period, and the reasons for this circumstance (decrease in the number of buyers, increase in prices for the purchase of goods, etc.).
(Video: "News" UNP "- Issue 8")
What to do when a tax claim is unfair
There are times when tax structures require an explanation in the absence of errors in the reporting. It is not necessary to ignore such requirements from the tax authorities. In order to avoid misunderstandings and not be subject to sanctions (including unexpected inspections by supervisory services), it is required to immediately notify the inspectorate that all submitted reports are correct and, if possible, provide copies of supporting documents. It must be remembered that for the inspection, it is not the text of the explanation that plays an important role, but the very fact of the answer.
A sample of compiling a response to a tax request for clarification
As noted earlier, there is no unified response to the inspection request, so you can write an explanatory one in any form. Of course, the text of the response must be displayed in the correct business style adopted for the design of service letters.
- First, usually in the upper right corner you need to write the address of the tax office, where the institution should provide an explanation. Next, the letter number is written, the locality and the area to which the institution belongs.
- The next line displays the data of the sender of the document: name of the institution, address, and contact phone number.
- In the next paragraph of the letter, before drawing up the text of the explanation, you need to display a link to the number and date of the request by the inspection and concisely describe the essence of their requirement, and only after that you need to start describing the explanations.
- The explanation must be described very scrupulously, with the provision of the necessary links to supporting materials, certificates, legislation, regulatory documents, etc. The clearer this section of the explanation is made, the greater the hope that the supervised body will remain satisfied with the answer.
- In the explanation, categorically, one cannot refer to inaccurate data, since this will be quickly revealed with subsequent severe sanctions from the tax inspectors.