Tax and such department: the state does not receive 94 million euros of the turnover of turnover per year
According to the tax and soil department (NTD), the state does not receive 94 million euros of the turnover of turnover per year. According to the analysis of the risks conducted by the NTD, about 19,500 enterprises cause the state damage to the turnover of a total of 94 million euros, the department reports. The concealment of turnover and the unreasonable declaration of input tax on turnover are the most common violations.
Recommendations from the NTD on how to avoid errors, as well as falling under the tax audit, are given below.
Legal entities who have risks on turnover tax are 6 % of all Estonia enterprises. This means that most entrepreneurs in the state know about the current rules and work accordingly to them.
According to the head of the risks in the field of tax on the turnover of Christie Veskus, the Department carefully studied almost 11,000 submitted turnover declarations last year. “We contacted entrepreneurs due to anomalies identified in their declarations both in order to clarify the declared information and to attract attention to possible errors. The obligation of enterprises to pay the turnover tax increased by almost 53 million euros as a result of our contacts compared to originally declared data, ”she said.
Most of the entrepreneurs associated with NTD voluntarily correct their mistakes in declarations, when they are indicated as possible shortcomings. In such cases, the department has no reason to start production, such burdensome for the taxpayer himself.
The largest number of errors was revealed in the analysis of the validity of the requirements for the return of tax tax. The enterprises were forced to correct in 2024 the data in more than 1270 cases, for a total of 28 million euros.
“The most common violation when deducting the input tax, on the basis of which unreasonable refund requirements arise, concerns declaration as a consolidated amount of turnover tax on a sum of less than 1000 euros, in accordance with the law, not allocated separately under transactions and partners. We often find out in the course of finding an answer to this question that there are simply no bills for purchases for such an amount. Last year, we revealed such violations in almost 360 enterprises totaling more than 14 million euros, ”said Christie Wesecrath, the head of the risk of tax on the turnover.
The deduction of the input tax on the basis of fictitious accounts is the most common fraud in this area, to which they are consciously resorted to. In order to carry out this, for example, bills from shadow firms and “Account Factories”, use various imaginary transactions and massively fake cash payments used in retail trade. Last year, the NTD revealed almost 230 cases when they tried to subtract the unreasonable entrance tax on the basis of fictitious accounts, as a result of which he set to pay about 8 million euros.
As in previous years, they are still evading taxes without declaring them. This can be both the most common mistake, the cause of which is ignorance of the rules for accounting for tax on circulation, and a conscious evasion of its payment; At the same time, enterprises cause damage to the state from hiding tax from a turnover of about 39 million euros per year. Retailing enterprises, services and construction spheres, in which cash are used more than others, are persons who hide the turnover more often than others. The NTD revealed in 2024 the concealment of turnover in 1600 commercial associations, whose obligation to pay tax increased by 24 million euros.
Refusal to register an enterprise as a tax tax obligated to turnover is one of the common ways to hide the turnover. The company often distributes its turnover between several commercial associations in order not to exceed the limit rate of 40,000 euros per year, upon the achievement of which the named registration is provided. “HTD, identifying such cases in the course of production, considers all units that are in this way, by one business entity – we are folding the momentum and summarize the achievement of the marginal rate on the turnover of all units associated with this enterprise,” said the head of the risk in the field of tax on the turnover of Christie Wesucus.
Commercial associations often do not declare both transactions made among themselves and the amounts received through the bank. This creates problems for both parties to the transaction. For example, the buyer has no hope of quick satisfaction of the requirement to return the tax on circulation if he declares the acquisition and request the specified return in one period, and the seller will not do this at the same time. A different reflection of transactions or their absence among the completed ones is one of the reasons why the NTD often addresses entrepreneurs – transactions.
Three recommendations on how to avoid unintentional mistakes and falling under the tax audit:
- digitize, as well as automate your accounting and tax accounting using electronic accounts;
- take the opportunity to file a tax on a turning tax declaration with one click of a mouse directly from the accounting software through X-Tee by direct data exchange between devices;
- Contact the NTD in advance to get a tax consultation, as well as get acquainted with detailed instructions And web coursespresented on the website of the department.
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