What is a tax investigation?
A tax investigation is essentially an economic investigation and is conducted by the investigation departments of the Israel Tax Authority, in the various districts; there are tax investigations that involve other offenses in addition to the tax offenses, and in which case the investigation will be conducted in cooperation with other investigative bodies, such as the Israel Police, and it will be called SIT (Special Investigation Team). A tax investigation may be opened against a private individual, an independent dealer, a company and/or corporation, based on the suspicion of committing tax offenses; the most common offenses are concealing income (working
Tax Offences – Fictitious Tax Invoices
A tax invoice issued illegally – ostensibly for a service or a sale performed – is called a “fictitious invoice”. The purchase of a fictitious invoice and reporting it as input, means reducing the amount of Value Added Tax (V.A.T.) that a dealer has to pay, and also reducing the payments to Income Tax and to the National Insurance Institute (NII), for it means an increase of the registered expenditure and a reduction the taxable income. The offsetting or distribution of fictitious tax invoices are criminal tax offences. According to the estimation of the Israel Tax Authority, the size of
Dealing with a tax assessment issued according to best judgment
Every dealer is required to administer account books and receipts from the very first day that his business is in operation. The administration of account books is dependent upon the type of business; the rules for bookkeeping are to be found in the Income Tax Provisions (Administration of Account Books). Many dealers and assessees are in a situation in which a best judgment assessment is offered to them, by the V.A.T. office’s auditors, or the tax inspectors of the Assessment Clerk’s offices. This is based on the conclusion that the business results of an assessee / dealer are unreasonable for
Durable Power of Attorney
“A person’s will is his dignity” A durable power of attorney is a legal document that allows any adult (over the age of 18) to determine explicitly, precisely who will be authorized, on his behalf, to make decisions for him and to handle his medical and/or economic affairs come the day that he will not be fit to decide and handle them himself. Moreover, he is entitled to determine how his life will be conducted in the new way of living, imposed upon him, when his judgment and his ability to make decisions will have been compromised. In
When can account books be disqualified?
Every dealer is required to administer account books and receipts, from the very first day on which he opened his business. The administration of the account books depends on the nature of the business, its size and the activity in which it deals. The instructions for administering V.A.T. and income tax account books are complex, cumbersome and not easy to implement. These instructions relate to the duty of every dealer and/or assessee to administer account books in his business, according to his occupation, his line of business and the branch to which he belongs. The instructions describe the documents that
