Authorities might not be aware of the fiscal effects of the legal acts that concern accountability when lacking materiality.
On the 28th article, fraction 1, of the Federal Fiscal Code (FFC from now on) stipulates that accountability, for fiscal effects its integrated in books, accountability register systems, paperwork, bank balances, special accounts, books or social registers, inventory controls, valuation methods, discs or tapes or any other filing mean. In addition, the proven documentation of the so mentioned assets, as well as all documents and information related to the fulfilling of fiscal dispositions to witch account for incomes and outcomes and whatever else the law establishes.
In the other hand, the financial information norm (FIN) A-2 points out that a basic principle of accountability that the economic substance overrules the actual form, concerning the entity’s economic events.
On its part, article 42 from the FFC makes available faculties for tribute authorities so that they can verify that the contributors, the solidarities responsible and the third parties related to them have comply with the fiscal and costume dispositions, and in such cases, might determine the omitted contributions or the fiscal credits as well as to verify the fiscal felonies commission, and with such, be in the possibility to lend information to other tributary agencies.
At the time, if as a result of its verifying faculties, tributary authorities might warn that the accountability of a particular contributor with certain financial movements, that to its judgment lack economic substance or material. Do not recognize the fiscal effects that the contributor might have offered. That is why there have been certain controversies among contributors and authorities that have been solve in court hearings.
To that effect, the First Section of the Superior Room of the Administrative Justice Federal Court (AJFC) emitted an isolated thesis that established that through verifying faculties from the treasury authorities this would be in a position where they could verify if the law situations or the ones that contributors pretend to give fiscal effects with data based documents and information provided by the visited subjects and third parties, and even to what has been observed throughout the visit, thus only through this way would there be a certainty of the existence of the so described operations. Now well, if the basic postulated of the FIN A-2 is to make the economic substance prevail over the actual form, regarding economic events that are registered in a company. Is in this sense that article 28 of the FFC and other related rules that regulate the forms and terms of a contributor must carry its own accountability. Also mentioned ion such article; that is to say that only existence operations must be registered and that in such register there must prevail the economic substance over the legal form. As such it has been resolved that:
Verifying faculties of the Fiscal authority. In its exercise, is valid to unrecognize the fiscal effects of the law actions that concern accountability when they lack materiality. Throughout the verifying faculties establish in article 42 of the Federation Fiscal Code what the Legislator pretended was that in case of the contributions from the oblige party where serf determinate, the fiscal authority might have the possibility to verify if there was a lawful situation or in fact those that the contributors pretended to give fiscal effects, basing on data, documents and information provided by the visited subjects and third parties and even to what was observed during the visit, because only through those means would there be a certainty of the existence of such operations. Now the basic statement of the financial information norm A-2 is that the economic substance prevails over the actual form, in what economic events a company may register. It’s in this way that article 28 of the Federation Fiscal Code and similar precepts regulate the way and terms that a contributor must follow to register its accountability, part of the same establishment, that is to say, there must only be a register of real operations, and, in such register the economic substance must prevail over the legal form. That is why if as a derivate of a check-up the authority noticed that the registered operations lack material substance it might determine its nonexistence exclusively for fiscal effects, that is to say, to disregard its efficiency for determination, refund or accreditation of contributions, without this meaning the annulment of the lawful act in matter and even less to exceed the objective of the visit.
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