As an experienced legal counsel specializing in tax matters, I have repeatedly observed how a lack of adequate preparation for a customs and tax inspection leads to serious consequences for inspected entities. Tax administration authorities have extensive powers enabling them to thoroughly verify business activities for compliance with tax, customs and foreign-exchange regulations. That is why it is so important to understand the legal framework within which customs and tax inspections operate, as well as the rights of inspected parties.
In this article, I will present a comprehensive analysis of the customs and tax inspection institution, its legal basis, procedure and practical aspects that may prove helpful if one is initiated against an entrepreneur. I will also discuss the differences between a customs and tax inspection and a tax inspection, which will provide a better understanding of the nature of actions undertaken by the National Revenue Administration authorities.
What is a customs and tax inspection, and which act regulates it?
A customs and tax inspection is a special type of inspection conducted by the authorities of the National Revenue Administration. Its legal basis is the Act of 16 November 2016 on the National Revenue Administration. This procedure is stricter than a standard tax inspection, which follows from its primary purpose: combating serious irregularities in the tax sphere.
It is worth emphasizing that a customs and tax inspection may cover a considerably broader range of matters than a tax inspection. The subject of an inspection may include not only issues concerning the correctness of tax settlements, but also customs matters, foreign-exchange matters and matters concerning gambling. Authorities conducting a customs and tax inspection may also verify whether tax books are properly kept or stored.
The provisions of the Act stipulate that customs and tax inspections are conducted by officers or employees of customs and tax offices. They perform inspection activities aimed at determining whether the inspected entity complies with tax law and other regulations covered by the scope of the inspection.
What are the differences between a customs and tax inspection and a tax inspection?
The fundamental difference between a customs and tax inspection and a tax inspection concerns the authority conducting the inspection. Tax inspections are carried out by employees of tax offices, whereas customs and tax inspections are conducted by officers of customs and tax offices. This is a significant distinction because the latter have considerably broader powers.
The second key difference concerns the scope of the inspection. A tax inspection focuses mainly on verifying the correctness of tax settlements, whereas a customs and tax inspection may also cover customs and foreign-exchange matters, as well as matters related to the import and export of goods in trade between the customs territory of the European Union and third countries.
The third significant differentiating element is that there is no need to give prior notice of the intention to initiate a customs and tax inspection. In the case of a tax inspection, such notice is the rule, subject to certain exceptions, whereas the initiation of a customs and tax inspection takes place on the date when the inspected party is served with the authorization to conduct the customs and tax inspection and the officer presents their official identification.
What powers do tax administration authorities have during a customs and tax inspection?
Authorities conducting a customs and tax inspection have an extensive catalogue of powers that significantly exceed those available during a standard tax inspection. Officers may, among other things, demand access to files, books and all kinds of documents related to the subject of the inspection, as well as secure collected evidence.
Particularly important is the power to stop vehicles and perform other activities within the scope of a customs and tax inspection, which is highly relevant when verifying the legality of the transport of goods. In cases specified by statute, officers may also conduct inspections in residential premises if there is a justified suspicion that business activities are being conducted there.
It is also worth emphasizing that, as part of a customs and tax inspection, officers may verify the correctness and timeliness of tax payments made by tax remitters and collectors, as well as examine the sources of assets and whether expenses correspond to reported income. This power is particularly important in the fight against the so-called “grey economy” and undisclosed sources of income.
How does the customs and tax inspection procedure work in Poland?
The customs and tax inspection procedure begins when the inspected party is served with the authorization to conduct the customs and tax inspection and the officer presents their official identification. It is worth noting that, unlike a tax inspection, a customs and tax inspection is initiated without prior notice. This element of surprise is intended to prevent the potential concealment or destruction of evidence of irregularities.
After the inspection is initiated, officers proceed with the actual inspection activities. These may include, among other things, reviewing documentation, verifying accounting records, questioning witnesses, and inspecting premises and property. The scope of the customs and tax inspection is specified in the authorization to conduct the inspection.
A customs and tax inspection ends with the issuance of an inspection result, which replaces a report. The inspection result contains findings concerning the provisions of law complied with or violated by the inspected party, as well as other information relevant to the case. Within 14 days from service of the inspection result, the inspected party has the right to correct the return
within the scope covered by the inspection.What documents are necessary during a customs and tax inspection?
The basic document initiating a customs and tax inspection is the authorization to conduct a customs and tax inspection. This authorization includes, among other things, the authority’s designation, the date and place of issue, the legal basis, the inspected party’s details, the scope of the customs and tax inspection, and the signature of the person granting the authorization. Officers must also present official identification confirming their identity and powers.
During a customs and tax inspection, the inspected party is required to provide all documents related to the subject of the inspection. These may include accounting documents
, invoices, contracts, bank statements, tax returns and other materials that may be relevant to the case. It is worth ensuring that the documentation is complete and organized, which can significantly streamline the inspection.If you need professional assistance during a customs and tax inspection, consider using the services of the law firm
Kopeć Zaborowski Adwokaci i Radcowie Prawni. Their team of tax law specialists has extensive experience representing clients during inspections conducted by National Revenue Administration authorities, which may prove invaluable in effectively protecting a taxpayer’s interests.What does the scope of a customs and tax inspection cover?
The scope of a customs and tax inspection may be very broad and cover various areas related to business activity. Above all, this inspection focuses on verifying compliance with tax law, but it may also concern compliance with customs and foreign-exchange regulations and regulations concerning gambling.
A customs and tax inspection may cover, among other things, whether tax books are properly kept or stored, the reliability of tax returns, the correctness of calculating and paying taxes, as well as the legality of the origin of assets and whether expenses correspond to declared income. In the case of entities conducting international business, the subject of the inspection may also include activities related to the import and export of goods in trade between the customs territory of the European Union and third countries.
A particular area of interest for authorities conducting customs and tax inspections is compliance with regulations concerning the entry into the territory of the Republic of Poland of goods subject to restrictions or prohibitions. This includes, among other things, the illegal import of excise goods, such as alcohol or cigarettes, and other restricted goods.
What inspection activities are undertaken as part of a customs and tax inspection?
Inspection activities carried out as part of a customs and tax inspection vary and are adapted to the nature of the inspected entity and the subject of the inspection. They include, among other things, analysis of accounting and tax documentation, verification that records correspond to source documents, checking the correctness of settlements with contractors, and analysis of financial flows.
Officers conducting a customs and tax inspection may also inspect premises, warehouses, means of transport and other places where business activity may be conducted. In certain cases, inspection activities may also include checking cash registers, verifying inventory levels or checking the authenticity of documents.
An important element of inspection activities is the possibility of questioning witnesses, including employees of the inspected entity, its contractors and other persons possessing information relevant to the case. Officers may also use expert opinions if resolving the case requires specialized knowledge.
What role does the head of the customs and tax office play in the inspection process?
The head of the customs and tax office plays a key role in the customs and tax inspection process. As the first-instance authority, they are responsible for conducting the inspection and issuing its result. The head of the customs and tax office grants the authorization to conduct the customs and tax inspection, defining its scope and indicating the officers or employees who will carry it out.
After the inspection is completed, the head of the customs and tax office concludes it by serving the inspected party with the inspection result. This document contains findings concerning the inspected party’s compliance with the law and information relevant to the case. If irregularities are identified, the inspected party has the right to submit a corrected return within 14 days from service of the inspection result.
An important power of the head of the customs and tax office is also the ability to convert a customs and tax inspection into tax proceedings. This occurs when, within 14 days from service of the inspection result, the inspected party fails to submit a corrected return or the authority does not accept the submitted corrected return. In such a case, the head of the customs and tax office issues, in the form of a decision, a notice confirming acceptance of the corrected return.
What rights does the inspected party have during a tax inspection?
Although a customs and tax inspection is a stricter procedure than a tax inspection, the inspected party has a number of rights intended to protect its interests. First and foremost, the inspected party has the right to participate in inspection activities and submit explanations concerning the subject of the inspection.
The inspected party also has the right to review the inspection files and make notes and copies of them. It may also request certification of copies of documents provided to the inspecting authority. Another important right is the ability to correct a tax return within 14 days from service of the inspection result, which may make it possible to avoid tax proceedings.
During a customs and tax inspection, the inspected party has the right to use the assistance of a professional representative, who may be an advocate, legal counsel or tax adviser. Professional assistance may prove invaluable, particularly in complex tax matters or when the inspection concerns issues significant to the taxpayer’s business.
How can the result of a customs and tax inspection be challenged?
The result of a customs and tax inspection may be challenged by submitting a corrected return covering the scope of the inspection within 14 days from service of the inspection result on the inspected party. This is a form of discussion with the inspection findings, in which the taxpayer presents their own position on the matter.
If the head of the customs and tax office accepts the submitted corrected return, they issue, in the form of a decision, a notice confirming acceptance of the corrected return. If the correction is not accepted or is not submitted within the required period, the customs and tax inspection is converted into tax proceedings, which end with a decision determining the amount of the tax liability.
An appeal against a decision issued by the head of the customs and tax office may be submitted to the director of the tax administration chamber within 14 days from service of the decision. The appeal may raise any substantive and formal arguments capable of challenging the merits of the decision. If the director of the tax administration chamber upholds the contested decision, the taxpayer may file a complaint with the provincial administrative court.
What are the consequences of irregularities detected during a customs and tax inspection?
The consequences of irregularities detected during a customs and tax inspection may be very serious and varied, depending on the nature and scale of the identified violations. If tax arrears are discovered, the tax authority will determine their amount together with default interest, which may place a significant financial burden on the taxpayer.
If the irregularities constitute serious violations of tax law, the matter may be referred for fiscal criminal proceedings. In such a case, the taxpayer may face penalties provided for in the Fiscal Penal Code, including fines, restriction of liberty and, in the most serious cases, imprisonment.
It is also worth remembering that the identification of irregularities during a customs and tax inspection may result in the taxpayer being placed under special tax supervision or subjected to more frequent inspections in the future. It may also affect the taxpayer’s credibility in relations with tax authorities and contractors, which may have long-term consequences for their business activity.
How can you prepare for a customs and tax inspection to minimize risk?
Proper preparation for a customs and tax inspection can significantly reduce the risk of negative consequences for the taxpayer. First and foremost, it is worth ensuring that accounting and tax documentation is maintained reliably and kept up to date. This applies both to records of revenue and costs and to source documents and tax returns.
An important element of preparation for an inspection is also conducting regular internal tax audits, which make it possible to detect and remedy potential irregularities at an early stage. It is also worth monitoring changes in tax regulations and interpretations issued by tax authorities on an ongoing basis, so that settlement practices can be adapted to current legal requirements.
If a customs and tax inspection is initiated, it is worth considering assistance from a professional tax adviser or a lawyer specializing in tax law. Such a specialist can help prepare for the inspection, analyze the documents that will be reviewed, and represent the taxpayer in contacts with the inspecting authority. Appropriate legal support may prove crucial to protecting the taxpayer’s interests and minimizing inspection-related risks.
Author: Piotr Kubala – legal counsel with many years of experience in tax crime matters.