The deadline for settling the tax case for the tax authorities

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Taxpayers have clearly defined deadlines for performing their duties, e.g. submitting declarations or paying taxes. If they receive a summons from the tax office, then with a specified deadline, e.g. 7 days, for submitting documents or explanations. What is the tax office's deadline for settling a tax matter, e.g. issuing a decision? What if he misses this deadline?

Deadline for settling a tax case - how much time do tax authorities have?

Tax proceedings should be conducted quickly. The regulations even indicate specific deadlines:

  • settlement of a case requiring the taking of evidence should take place without undue delay, but not later than within one month (unless the law provides for a different date);

  • handling a particularly complicated case should take place no later than within 2 months from the date of initiation of the procedure (unless the law provides for a different date);

  • cases that may be examined on the basis of evidence presented by the party, including a request to initiate proceedings or on the basis of commonly known facts and evidence known ex officio to the authority conducting the proceedings, should be dealt with immediately;

  • settlement of the case in appeal proceedings should take place no later than within 2 months from the date of receipt of the appeal by the appeal body, and the case in which the hearing was held or the party submitted a request for a hearing - not later than within 3 months.

In practice, these deadlines often take much longer. They do not include, for example, periods of suspension of proceedings and periods of delays caused by the fault of a party or for reasons beyond the control of the authority. Then we cannot speak of excessive length of the proceedings.

Attention!

Other rules apply to the issuance of individual interpretations of tax law. We write about them later!

 

Judgment of the Supreme Administrative Court in Warsaw of October 6, 2017 (file reference number I FSK 328/16)

The length of the proceedings may be considered when the authority performs activities in a long period of time, or performs sham activities, or multiplies evidentiary activities beyond the need resulting from the essence of the case. It is also not without significance for the assessment of the legitimacy of the authority extending the deadline for completing the proceedings whether the case requires a multi-threaded evidentiary procedure including also checking activities at its contractors.

Indication of a new date for settling the matter

If the tax authority is unable to meet the deadline, it is obliged to notify the party about it, stating the reasons for the failure to meet the deadline and indicating a new deadline for settling the tax matter (Art. 140 of the Tax Ordinance Act).

This also applies if the failure to meet the deadline was due to reasons beyond the control of the tax authority.

The deadline was not met. What's next?

What if the tax authority did not meet the deadline and issued a decision after it? Is it invalid? Not. Exceeding the deadline by the tax authority does not mean that it cannot issue a decision (the exception here is exceeding the deadline for issuing an individual tax ruling - more on that later).

The term in art. 139 of the Tax Ordinance, the deadlines for settling the case are intended to discipline the tax authorities to operate efficiently, and the exceeding of these deadlines and the deadlines additionally set on the basis of Art. 140 of the Act, does not deprive the authority of the competence to settle the case, nor does it cause the final decision to be defective, nor does it affect the validity of actions taken before and after this deadline - stated the Supreme Administrative Court in its judgment of 3 November 2016, file ref. . II FSK 2966/14.

Deadline for issuing an individual tax ruling

Taxpayers often exercise the right to request an individual interpretation of tax law provisions - because compliance with the interpretation may not be harmful to the applicant. The interpretation should be issued no later than within 3 months from the date of receipt of the application (Article 14d of the Tax Ordinance).

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Tax ruling not issued on time - effects

The rule is that if the tax authority "does not meet" the deadline for settling the matter, it may issue a decision anyway and it binds the taxpayer. However, tax interpretations are an exception. Another rule applies here, which is beneficial for taxpayers.

If an individual interpretation is not issued on time, it is considered that on the day following the expiry of the interpretation deadline, an interpretation has been issued which confirms that the applicant's position is fully correct (Article 14o of the Tax Ordinance Act). This is called silent interpretation. Therefore, the taxpayer undoubtedly benefits from the fact that the tax authority did not have time to issue an interpretation.

Is it chronic? There is no interest

If the tax authority has been conducting the proceedings for too long and terminated with a decision from which the obligation to pay the tax arises, there is a chance to avoid paying part of the interest (Article 54 § 1 point 3 and 7 of the Tax Ordinance):

  • for too long proceedings before the authority of first instance: default interest on tax arrears is not charged for the period from the date of initiation of tax proceedings to the date of delivery of the decision of the authority of first instance, if the decision was not delivered within 3 months from the date of initiation of the proceedings;

  • too long proceedings before the appeal body: as a rule, the appeal procedure should be settled within 2 months of receipt of the appeal, and the case in which the trial was held or the party submitted a request for a trial - no later than within 3 months; if this deadline has been exceeded, no interest may be charged for the period of exceeding.

Reminder for failure to settle the matter on time

If the tax proceedings are prolonged, you can submit a reminder that the tax case is not resolved on time. They are submitted to the higher-level tax authority (Art. 141 of the Tax Ordinance).

If the reminder is considered justified, the authority to which the reminder was submitted:

  • sets an additional date for settling the matter,

  • orders explanation of the reasons and determination of persons guilty of not resolving the case on time,

  • if necessary, take measures to prevent future violations of the deadlines for handling cases,

  • states whether the failure to settle the matter on time was in gross violation of the law.

Complaint to the court about the inactivity of the tax authority

It is also possible to file a complaint to the administrative court against the inactivity of the tax authority. This is allowed by art. 3 § 2 point 9 of the Act - Law on proceedings before administrative courts. Importantly, in this way it is also possible to appeal to the court for the prolonged tax inspection due to inactivity of the tax authorities. It was ruled by the Supreme Administrative Court in a decision of November 24, 2016, file ref. act I FSK 1360/16.