How are the taxpayers who will be audited by the Tax Office selected?

Written by Prokopis Hadjinikolo

The taxpayers who will be audited during the coming period are selected these days through the audit mechanism, which indicates that the Tax Administration has operated the machines to the fullest extent. The instructions directed to auditors are to verify, as a matter of priority, cases of the past five years, as well as major cases of tax evasion. Priority cases are classified for audit by the audit department, based on an automated model for objective evaluation of cases after applying risk analysis standards.

Based on the planning, tax cases for the last five years are examined in order of priority, and those that show a high percentage of deviation, in addition to five categories of cases whose monitoring is completed immediately, regardless of whether they are prioritized or not. In particular, the following were targeted:

1. Investigation cases arising from Public Prosecution orders at the request of the Public Revenue Investigation and Ensure Service (YEDE).

2. Investigations and controls resulting from YEDEDE’s participation in special monitoring workshops and carried out in the context of special provisions for other services.

3. Investigations into cases that are in the audit report preparation stage.

4. Cases related to the implementation of certain targeted field audits, in addition to other preventive audits to ensure the fulfillment of tax obligations, bookkeeping and issuance of tax information, in accordance with applicable provisions, for taxpayers who carry out any activity or trade in goods.

5. Cases related to verifications of intra-community transactions (VIES) and cases of multilateral (simultaneous) inspections conducted by Greek and foreign tax authorities.

Priority audit cases are selected by decision of the Governor based on risk analysis criteria, data derived from internal and external information sources, or exceptionally, based on other criteria, which are determined by the Governor and are not made public.

The percentage of full and partial audits for tax years, uses, cases, periods or obligations related to the last five years, including the year the decision was issued, which cannot be less than 70% of the total full and partial audits, respectively, of the priority cases reviewed. Most audits relate to the last three years in which the deadline for filing an income tax return has passed. Audits can extend beyond the previous two years, beyond the past three years, or tax years or years depending on the criteria.