We defend taxpayers in disputes with the tax authorities.
We handle complex tax disputes, from the analysis of acts issued during tax inspections and the preparation of administrative tax appeals through to representation before the administrative and tax courts. We examine both the lawfulness of tax acts and the correct determination of the facts and tax liabilities. We build the defence through careful analysis of documents, evidence, case law and the rules of national and European tax law. SĂVESCU & ASOCIAȚII is a firm of litigators. In tax matters, this means that we assess each stage also from the perspective of the proceedings that may follow. A tax dispute often needs to be prepared before proceedings are brought before the court.
Disputes with the tax authorities. We represent legal entities and individuals in disputes concerning acts issued by ANAF and local tax authorities. Among other matters, we handle cases concerning:
– tax assessment decisions and other administrative tax acts
– VAT
– corporate income tax and personal income tax
– refusal or restriction of the right to deduct
– recharacterisation of transactions or legal relationships
– ancillary tax liabilities
– precautionary measures
– tax enforcement proceedings
– refusals to grant refunds or reimbursements
– other tax claims and liabilities established by the tax authorities.
In each case, we identify not only the applicable tax rule, but also the facts on which the authority has based its conclusion and the evidence by which those facts may be established or challenged.
Tax inspections. In reality, a tax dispute may begin during the tax inspection itself. Findings made at this stage, the documents submitted, explanations provided and the manner in which the taxpayer responds to requests from the inspectors may significantly influence the tax acts issued subsequently. We provide legal assistance during tax inspections and tax audits. We analyse the issues identified by the inspection team, the relevant documents, the taxpayer’s arguments and the legal consequences of the findings under consideration. Where there are indications that a dispute may arise, we prepare the taxpayer’s position with the subsequent stages also in mind: the tax appeal and proceedings before the court.
Analysis of administrative tax acts. We analyse tax inspection reports, tax assessment decisions and other acts issued by the tax authorities. We examine both compliance with substantive tax law and the lawfulness of the procedure by which the tax liabilities were established. A tax assessment decision must be analysed together with the documents and findings on which it is based. The questions are specific:
– What transaction was examined?
– What factual circumstances did the authority establish?
– On the basis of what evidence?
– What legal rule did it apply?
– Is the tax conclusion the correct consequence of those facts?
In complex tax disputes, the answers to these questions build the case.
Tax appeals. We prepare and pursue appeals against administrative tax acts. For us, the administrative appeal is not merely a formal stage preceding court proceedings. It is the stage at which challenges concerning the factual circumstances, the interpretation of tax rules, the evidence and the calculation of the liabilities established by the authority must be identified rigorously. Failure to raise an important argument or adequately explain a piece of evidence may have consequences for the subsequent course of the dispute. We therefore prepare the appeal with the entire dispute in mind, including the prospect of the case being examined by the court.
Annulment of administrative tax acts. We represent taxpayers in proceedings seeking the annulment of administrative tax acts. We challenge such acts where the tax liability has been established through an incorrect application of the law, an inappropriate legal characterisation of transactions, an erroneous determination of the facts or a breach of relevant procedural rules. Before the court, we reconstruct the transactions under examination and test the authority’s reasoning against the documents, evidence and applicable legal rules. The fact that a tax liability has been established by an act of the authority does not mean that its existence and extent can no longer be reviewed. That is the purpose of judicial review.
Suspension of enforcement. In some cases, merely challenging a tax act is not sufficient to protect the taxpayer. Enforcement of the liabilities established by the authority may have significant consequences for the taxpayer’s assets, liquidity and ongoing business activities before the court has finally ruled on the lawfulness of the act. Where the statutory requirements are met, we prepare and pursue applications for suspension of the enforcement of administrative tax acts. We consider this possibility from the outset of the dispute, rather than only after enforcement proceedings have begun. In tax disputes, effective protection of the client sometimes requires both challenging the liability and limiting its effects for the duration of the proceedings.
Precautionary measures. Precautionary measures may have an immediate impact on the taxpayer’s assets and business activities. We challenge such measures where they are unlawful or where their conditions and scope are not justified by the circumstances of the case. We analyse the legal basis of the measure, the reasons relied upon by the authority, the assets affected and the relationship between the objective pursued and the consequences borne by the taxpayer. The fact that the claim is a tax claim does not remove the requirement to comply with the statutory conditions for restricting the disposal of assets.
Tax enforcement proceedings. We also represent taxpayers in disputes concerning tax enforcement proceedings. We review the enforceable titles and enforcement acts, the claim being pursued, the procedure used and compliance with the taxpayer’s rights. Enforcement may raise issues distinct from the lawfulness of the act by which the tax liability was established. We therefore analyse separately what is being enforced, on the basis of which title, by means of which acts and within what limits. Where the circumstances require it, we coordinate the challenge to the enforcement proceedings with the dispute concerning the tax claim itself.
VAT. VAT disputes are among the tax cases requiring particularly careful analysis of the facts. The existence of the transaction, the documents, the movement of goods or provision of services, the taxpayer’s conduct and the circumstances in which the taxpayer acted may all become decisive factors. In such disputes, we analyse the economic transaction as a whole, rather than merely the individual document relied upon by the authority. VAT law is strongly influenced by European Union law and the case law of the Court of Justice of the European Union. Accordingly, where the case requires it, national legislation is interpreted together with the relevant rules and European case law.
Corporate income tax and personal income tax. We handle disputes concerning the determination of the tax base, the deductibility of expenses, the tax treatment of income and expenditure, and other matters relating to the taxation of legal entities or individuals. In such cases, the tax treatment cannot be separated from the economic and legal reality of the transaction. We analyse contracts, accounting and commercial documents, economic flows and the explanations provided by both the taxpayer and the tax authority. A complex tax dispute is rarely resolved by reading a single legal provision in isolation; the transaction itself must be understood.
Evidence in tax disputes. Documents are essential in tax disputes. Contracts, invoices, accounting records, correspondence, reports, bank records, electronic records and other documents relating to the transactions under examination may determine the outcome of the dispute. A sound tax argument must be supported by established facts. We therefore reconstruct the transactions and their chronology and examine whether the authority’s interpretation is consistent with the available documents. We consider not only what the authority asserts, but also what it can prove. In the same way, we assess what the taxpayer must establish and by what means this can be done.
Expert evidence. Some tax disputes involve the examination of substantial volumes of accounting, financial or technical documentation. In such cases, expert evidence may play an important role in establishing the facts and the economic consequences of the transactions under examination. We prepare the relevant questions for the expert, analyse the technical conclusions and integrate them into the legal strategy of the case. Expert evidence does not replace legal argument. It must, however, provide the court with the technical answers required for the correct application of the law.
European tax law. A significant part of tax law, particularly in relation to VAT, cannot be analysed solely by reference to national legislation. We apply the relevant rules of European Union law and the case law of the Court of Justice of the European Union where applicable. In cases where resolution of the dispute depends on the interpretation of EU law, we also consider the possibility of using the preliminary reference procedure. A domestic tax dispute may, at the same time, be a dispute governed by European law.
Tax and criminal matters. Sometimes, the same economic transactions are simultaneously the subject of a tax audit and a criminal investigation. In such circumstances, explanations, documents and legal positions presented in one set of proceedings may have consequences for the other. Our experience in tax litigation and business criminal law enables us to approach such cases in a coordinated manner. We analyse the nature of each procedure separately, while developing the strategy with the overall legal risks in mind. A difference in tax interpretation and a criminal allegation are not the same thing and must be addressed in accordance with the rules specific to each area of law.
Economic consequences of the dispute. A tax dispute is not merely an abstract legal issue. A tax assessment may affect cash flow, investments, financing, relationships with commercial partners and even the continuity of a business. Accordingly, when selecting the procedural strategy, we also assess the economic consequences of each available course of action. Tax disputes require precision, strategy and an understanding of the economic consequences of each legal solution. Our objective is the effective protection of the client’s interests, not merely the completion of a procedure.
Disputes built on facts, evidence and law. In tax matters, the authorities have powerful institutional mechanisms for establishing and recovering tax claims. The taxpayer has the right to challenge the lawfulness and merits of the measures affecting it. We use those means rigorously. We analyse the acts. We reconstruct the facts. We examine the evidence. We research the case law. We challenge interpretations that we consider unlawful and advance the client’s position before the authorities and the courts.
We defend taxpayers’ assets and rights.
Dr Dan Șova, Lawyer
Dr Andrei Săvescu, Lawyer
Răzvan Crăciunaș, Lawyer