Procedural obligations of the taxpayer

As a taxpayer, one has various obligations within the framework of tax assessment. The most important and obvious so-called procedural duty of the taxpayer is to fill out the tax declaration truthfully and submit it on time. However, that is not enough, because the assessment authority may demand further information or additional documents. Failure to comply with this obligation may lead to a discretionary assessment.

Every taxpayer has procedural obligations to fulfill to enable a correct assessment. For example, the tax declaration must be filled out truthfully and completely, signed personally, and submitted on time along with the prescribed attachments. If one has not received a form for the tax declaration, it must be requested from the competent authority. Upon request of the assessment authority, information must be provided or business books, receipts, and other certificates as well as documents about the business transactions must be presented. If the taxpayer fails to meet his procedural obligations, or if the tax factors cannot be accurately determined due to unreliable documents, the assessment authority will make an assessment at its discretion (discretionary assessment). For this, figures based on experience, asset development, and the taxpayer's standard of living can be considered. Such an assessment based on discretionary decision can only be challenged due to obvious incorrectness through appeal, as it is based on discretion and cannot accurately reflect the actual circumstances. If the authorities are to consider an appeal due to obvious incorrectness, the taxpayer must comprehensively prove the obvious incorrectness. All documents relating to the facts must be attached. If this is not done, and only partial evidence is provided with the submitted documents, the tax administration will not consider the appeal.

In the Federal Court ruling 2C_930/2016, 2C_931/2016, this was experienced by a taxpayer residing in Israel. He was a co-owner of a property in the Canton of Solothurn, which is why he filed his tax declaration there. The cantonal tax administration requested him 11 days later to submit further necessary documents: proof of worldwide income and assets, completeness certificates of all bank relationships, the tax declaration in Israel, receipts concerning income and assets abroad, and proof that his adult children were still in education, or regarding their income and assets. He only sent them documents concerning the education of the children. Consequently, he was assessed on a discretionary basis. He filed an appeal against what he considered obvious incorrectness, but again did not submit all necessary documents, which is why the authorities did not proceed with it. He appealed to the Federal Court, which, however, confirmed that the authority was right not to consider the appeal since the taxpayer had not submitted the required documents.

Findea helps you keep your taxes simple and trouble-free.