Tax audit is regulated in section VI of tax ordinance, which is closely related to chapter IV of the ordinance, as provided for in article 292 of that act.
The procedure of tax audit acts as subordinate to tax proceedings as it contains the weight of evidence rules and includes more sophisticated ways and methods of command than tax proceedings. Tax audit has narrower range and is limited to considering whether the obligations of tax laws are implemented, in other words, the tax audit is to confront the actual state of affairs with the correct model and adopt the results of those findings. Therefore, audit should be considered as the initial stage of tax proceedings which, depending on the result, ends with findings that do not require a dimensional decision, or arrangements that would require initiation of tax proceedings and passing a decision. Tax proceedings governed by the law include a set of actions taken by competent authorities in order to establish the existence of tax liability and the concretization of tax liability or to resolve other issues related to assessment and tax collection.
Operators who conduct tax audit are tax authorities of first instance, or tax inspectors. Initiation of tax audit occurs ex officio (article 282, tax ordinance). The information on the need to carry out tax audit can be sent by units of entire apparatus of the Ministry of Finance. The information may also be issued by natural persons, banks, police, prosecutors or the media. Tax audit may be initiated at any time. In principle, tax authorities have a duty to notify the controlled about their intention to begin a tax audit (article 282b § 1, tax ordinance) Initiation of control before 7 days from service of notification requires the consent of the controlled. The obligation of serving notification does not apply to, inter alia: validity of refund of tax difference or input tax, situation when the control should be initiated at the request of the authority conducting the investigation of a crime or a fiscal offence or when it applies to the taxation revenue unaccounted for in disclosed sources or coming from undisclosed sources.
In terms of cases decided by a final decision of tax authorities, tax audit can not be re-opened (article 282a, tax ordinance.) However, this rule does not apply to annulment, revocation, repeal or change of the final decision. Nor does it apply to resumption of proceedings culminating in the final decision and repeal or annulment of the decision reached by an administrative court.
In the absence of the controlled, or the person authorized by him, tax audit may be initiated after an identity card is shown to an employee of the controlled, who may be regarded as a person referred to in article 97 of the act of 23 April 1964 - civil code (Journal of Laws no. 16, item 93, as amended.), or in the presence of a witness cited, who should be a public official, however, not an employee of the authority concerned (article 284a § 1, tax ordinance.)
Pursuant to the provisions of article 284a § 1 of the ordinance, tax audit may be initiated after the controlled or the person authorized by him is shown an identity card, when the proceedings are necessary to prevent the commission of a crime or a fiscal offence or secure the evidence of its commission. In this case, without undue delay but not later than 3 days from the date of the initiation of control, the authorization to conduct the audit shall be serviced.
Tax audit is conducted on the basis of individual authorization granted by the head of tax office, or by the employee standing in for the head of that office (article 283 § 1, tax ordinance).
In accordance with article 284 § 1 of the tax ordinance, the initiation of tax audit takes place after the controlled or the person authorized to represent him during the audit is served with the authorization to carry out the proceedings and is shown a proper identity card. The authorization for inspection should include a definition of the scope of the subjective. It should also include the date of initiation and the expected date of its completion. The authorization should also include instruction on the rights and obligations of the controlled. Taxpayers, payers, collectors and successors may, in writing, appoint a natural person who is authorized to represent them in the tax audit, and report the person to the head of appropriate tax office, mayor or president of the city (article 281a § 1, tax ordinance.). Pursuant to art. 136 of ordinance, a party can also act by proxy, unless the nature of their activities requires personal action. The proxy, in accordance with article 145 § 2 of the ordinance, should be provided all the documents.