Tax authorities visiting

A few weeks ago, I had the opportunity to attend a reunion drink at the National Audit Office, where my career once began. That was also immediately the best time I experienced. Tax officials do not sufficiently realise the protected status they have. With law in hand, they roam the country, St Nicholas would say. But they don't play Santa Claus. That is why entrepreneurs fear the tax official. In the Bible, he was still called a tax collector. For me, it remains intriguing to see how my former colleagues from the tax administration deal with our customers.

We have daily contact with the tax authorities. We see a big difference in treatment between our large clients and small business. From the tax department large businesses work with a customer coordinator (KC) and that is a huge advantage.

Prevent gunfire

The KC knows the business and coordinates the deployment of treatment team specialists. Over the years, we also get to know those specialists. Mutual respect develops and there is quite a bit of laughter. But if necessary, we cross swords and do not shy away from legal proceedings. Some time ago, for instance, we stood before the court in Den Bosch. But the atmosphere remains good; we continue to consult each other constructively in other matters. These consultations are increasingly becoming preliminary consultations, so that we create certainty with each other beforehand about the assessment of a tax issue and prevent any gunplay afterwards. This requires mutual trust. We must paint an honest picture of the expected developments and the tax authorities must search with us for the most tax-friendly way forward.

At that time, we had to pass a rigorous selection process before being admitted to the deputy accountant 1st class course. The business community was therefore very interested in those officials because of their good skills and education. Now we mostly come across people who joined the tax department from the business world. The motives are often in the personal sphere and the remuneration is then apparently more decisive. For the consulting industry, this is not good, a competitive government service in the job market. It also seems inconvenient for clients because their former confidant is suddenly working in the tax department. Once a big client said to me that he had dreamt that I had gone back to the tax department. He called it a nightmare.

Understanding the business

I have never come across an entrepreneur who does not want to pay taxes. But their contribution should be limited to a fair share. And that, of course, is very subjective. What does the entrepreneur consider a fair contribution? If he is treated worse than the competitor he will not accept it. If he has to pay double in international relations, the same applies. We recently had a lot of discussion following a VAT audit in which the tax authorities threatened to impose large additional levies, while we could in no way indicate any disadvantage to the state. It ended well after two years of wrangling, but the client is left with damages anyway. Think of the many hours he himself and his financial staff had to spend, but obviously also the cost of us. Still, I plead my own case here, because always make sure that as a business owner, you get expert assistance. That means tax officials behave more diligently, but also leads to the damage being limited.

As a tax official, I was very much in favour of taking the ‘understanding the business’ phase very seriously. We developed the so-called customer view and were aware that we had to keep this customer view up to date and all our tax findings had to be projected onto that customer view. This is still reflected within Tripolis. All consultants we hold that up on repeat. They have a natural tendency to elevate their own specialism to the kingdom of heaven. For example, we had a battle with a payroll tax inspector over the level of the customary wage. He himself thinks he won the battle and is still reveling in his success, while his colleagues in income tax, corporate tax and recovery have to invest many hours to pick up the shards he left behind.

I like to compare it to the orthopaedist and my father. Who had broken his hip and had been helped on that. I spoke to the orthopaedist after the operation and asked him how it had gone. He was very satisfied with his work and left the room. Leaving my father with delirium because he had wrongly been given anaesthesia combined with the known diseases of Parkinson's and Alzheimer's. To the orthopaedist, my father was a hip.