Management/CFO liability protection
Our experience, particularly that gathered in support of tax audits, shows that it is worth investing time and resources in preparing a VAT due diligence procedure.
Such a procedure can help to:
– avoiding the harsh consequences of incurring company and personal liability after dealing with both a dishonest contractor and a potentially dishonest employee/co-worker,
– the management of tax issues itself in a more informed manner (and thus in a better perception of the company by the tax authorities).
The due diligence procedure relates to:
– input tax – setting out, inter alia, rules for the verification of suppliers and individual purchase transactions in terms of documenting bona fides for the purposes of input VAT settlements in domestic transactions;
– output tax (to the extent indicated by recent CJEU jurisprudence) – limiting the sanctioning liability of the company/management board members for invoices issued outside their control, with the aim of defrauding VAT, by a potentially dishonest employee/co-worker.
We thus propose to prepare an appropriate due diligence procedure or update the procedure already in place (in view of, for example, the latest court case law).