What are the principal procedural obligations of a taxpayer, that is, the maintenance of records over what period and how regularly must it file a return or accounts?

Tax

Cyprus Small Flag Cyprus

For income tax purposes, books and records and supporting documentation must be retained for six years after the end of the tax year to which they relate. However, the retention period for VAT purposes is seven years so this is the effective minimum.

Taxpayers are required to submit annual returns of income for income tax purposes, accompanied by audited financial statements complying with IFRS if the taxpayer is a company, or an individual with income above a certain threshold (currently EUR70,000). There is a self-assessment system for income tax, under which taxpayers must submit an estimated tax return part-way through the tax year accompanied by payment of half the estimated liability, and the balance of the estimated liability at the end of the tax year. The final tax return is submitted after the end of the tax year, together with payment of any final balance. See the answer to question 5 for details of due dates.

Employers are also required to submit annual returns of employees’ pay and tax deducted.

Special Defence Contribution, commonly known as SDC tax, is payable on rents, interest and dividends. Subject to certain exemptions, companies making such payments must deduct SDC tax at source and account for it to the Tax Department. Taxpayers receiving rents, interest or dividends from which SDC tax has not been deducted must submit semi-annual returns together with payment of the amount due.

Taxpayers must report any capital gains as they arise. However, as capital gains tax only applies to a very limited range of assets this is not an issue that affects most taxpayers.

There is a separate tax system for qualifying businesses engaged in international shipping, which is outlined in the answer to question 15.

Greece Small Flag Greece

Pursuant to Code of Tax Procedure (Article 13 par.2 of Law 4174/2013), a taxpayer must keep his/her records, accounting books and returns for five (5) years from the end of the fiscal year in which there is an obligation to declare them or until the prescription of tax claims or until the final judgment in case of litigation or after the payment of the tax liabilities in full. In practice it is advisable to keep tax records for more.

Turkey Small Flag Turkey

Yes, the principal procedural obligation of a tax payer is maintenance of records duly, in line with Tax Procedural Law and uniform chart of accounts. The tax return filing periods depends on the kind of tax; for instance corporate tax returns are filed annually but there are advance corporate tax returns which are required to be filed quarterly periods; VAT returns are submitted monthly; withholding tax returns are either submitted monthly or quarterly.

United Kingdom Small Flag United Kingdom

The principal procedural obligation on a UK taxpayer is to file a tax return. Companies are required to provide self-assessments of their corporate tax liability on delivering the return. Returns must normally be filed within 12 months of the end of the accounting period for which the return is made.

Most employees pay their income tax through the employer company’s payroll system and are therefore not required to submit a tax return. However, where an employee’s tax affairs are complicated in some way (for example, by having a source of untaxed income) or where an individual is self-employed, that person is required to complete a tax return providing a self-assessment of any tax due.

Mexico Small Flag Mexico

Individuals and legal entities deemed as Mexican residents for tax purposes are required to register under the Federal Registry of Taxpayers, specifying a tax domicile within national territory.

Additionally, Mexican residents for tax purposes are bound to maintain accounting records that in general terms consist of books, ledger entries, account statements, inventories, notices to the Federal Registry of Taxpayers, tax returns, financial statements, information concerning shares or securities held, customs documentation and documentation supporting the materiality thereof.

Accounting records ought to be duly kept for a period of five years (some exceptions could apply) and digitally filed before tax authorities on a monthly basis.

Generally speaking, taxpayers are also required to file provisional income tax returns on a monthly basis and a definitive annual tax return. Concerning value added tax, taxpayers ought to file monthly returns, same that are considered as definitive.

Depending on the taxpayers’ activities or corporate structure, the filing of informative tax returns regarding their participation in offshore legal entities or income perceived in jurisdictions considered to be subject to preferential tax regimes in terms of Mexican law could be mandatory.

It is of paramount importance to point out that failing to comply with the above-mentioned formal obligations, whether it be the registry under the Federal Registry of Taxpayers, properly maintaining accounting records or filing the corresponding returns, could result in infractions or even in the commission of tax crimes sanctioned with prison.

Gibraltar Small Flag Gibraltar

Tax returns must be filed annually, nine months after the financial year end of a company. For accounting periods ending on or after 1st January 2016, all companies registered in Gibraltar (as well as any other company with income assessable to tax in Gibraltar) are required to file a tax return. Previously, only companies with income assessable to tax in Gibraltar were required to file a tax return.

Japan Small Flag Japan

It is very common practice in Japan that corporate taxpayers adopt the so-called ‘blue-form’ tax return filing for their Japanese corporate income tax, which is a system of tax computation and return filing based upon double-entry bookkeeping system. Under this system, corporate taxpayers are required to keep their books and records for a fiscal year using double-entry bookkeeping system.

Then, based upon such books and records, corporate taxpayers prepare and file a corporation tax return, once a fiscal year, within three months (assuming one-month’s extension is secured per the prevailing practice) from the close of the relevant fiscal year. Similarly, for Japanese consumption taxes or VAT, corporate taxpayers keep books and records, and prepare and file a consumption tax return, once a fiscal year, within two months from the close of the relevant fiscal year. There are similar return filings for local taxes.

Corporate taxpayers are obligated to maintain such books and records for seven years, and have to provide them to the tax authority for inspection if tax audit is conducted.

Hong Kong Small Flag Hong Kong

Hong Kong applies a schedular tax system with three types of taxes: profits tax, salaries tax and property tax. The taxation year is referred to as the year of assessment and runs from 1 April to 31 March.

Generally, taxpayers are required to file for tax only when the tax authorities prompt them to do so by issuing them a return. Filing is required at the time specified in the return (usually a month for individuals). For a business, the taxpayer will be expected to include with the return (audited) financial statements as well as a tax computation. For individuals involved in employment, or property owners, no other document is required to be included with the tax return at the time of filing.

All taxpayers are required to maintain records relevant to any year of assessment for a period of seven years after the year of assessment. Records should be maintained in English or Chinese (if not, the taxpayer may have to translate his records in English or Chinese if they are ever requested). Failure to retain adequate records can lead to penalties or criminal prosecution in particularly egregious circumstances.

United States Small Flag United States

Taxpayers are required to file tax returns each year. Tax returns are generally due by April 15th of the following calendar year for individuals, and for corporations by the 15th day of the third month following the end of its fiscal year. Automatic 6 month extensions of time to file a return are available. Companies (and certain individuals, such as self-employed individuals) generally are required to make quarterly payments of their estimated tax liability.

Generally, taxpayers are required to maintain adequate records for at least three years. Records must be kept for as long as the statute of limitations is open for that item. Thus, in certain situations where the statute of limitations is longer than three years, records must be kept for 7 years or even indefinitely. In addition, many substantive provision of the tax code and regulations have their own separate record keeping requirements.

Spain Small Flag Spain

The main obligation of the taxpayer is to file a tax return. This tax return is completed on a self-assessment basis where the taxpayer declares the income/profits obtained and calculates the tax due. The deadline for filing each return depends on the specific tax.

Individual taxpayers are required to file a Personal Income Tax return no later than 30 June of the following year. The filing deadline for companies depends on their accounting period but for those with a calendar year, the deadline is usually 25 July of the year following the end of the period to which the return refers.

Taxpayers must keep their records and books during the statute of limitations period (4 years).

Austria Small Flag Austria

In general, income tax is assessed for the calendar year on the basis of an individual’s or a corporation's tax return. The tax return has to be filed by 30 June of the following year. An automatic extension up to 31 March of the next following year is granted if the individual or the corporation is represented by a tax professional. Further extensions are available on request in special circumstances.

Germany Small Flag Germany

In Germany, the principal procedural obligation of a taxpayer is to file annual tax returns. Returns have to be filed no later than 31 May of the following year or if the return is prepared with the assistance of a professional tax advisor no later than 31 December of the following year. Since salary and wages are subject to employer tax withhold and reporting, often employees are not obliged to file an income tax return, provided they have not received any income from sources other than dependent services.

As a matter of principle, tax relevant records have to be kept and stored for six years but this period may be longer if the assessment period for the relevant tax has not yet expired after the end of the six years. Depending on the nature of the records and whether or not the records relate to business income, more specific rules apply. For private individual taxpayers the record keeping rules are not that strict.

Belgium Small Flag Belgium

A Belgian taxpayer’s principal procedural obligation is to file a tax return.

Corporate income tax returns must be filed electronically. The period for filing may not be less than 1 month after the date of approval of the company’s accounts by its shareholders’ general meeting and must not be longer than 6 months after the end of the company’s accounting year.

The company’s financial statements, including its balance sheet, profit and loss account and explanatory note must be included with its tax return.

Financial statements and other records that are related to a particular year of income for which the company’s taxable income may be determined must be kept in any company place of business in Belgium for the following seven years.

Italy Small Flag Italy

In Italy, the principal procedural obligation of a taxpayer is to file annual tax returns. Returns have to be filed no later than 30 September of the year following that of reference. The filing is made through electronic means. Since salary and wages are subject to employer tax withhold and reporting, often employees are not obliged to file an income tax return, provided they have not received any income from sources other than dependent services.

As a matter of principle, tax relevant records must currently be kept and stored until the 31st December of the fifth year following that in which the relevant tax return was filed (or 7th year in case of omission to file it), or in any case until the statute of limitation has expired. Depending on the nature of the records and whether or not the records relate to business income, more specific rules apply. For private individual taxpayers the record keeping rules are not that strict.

Malaysia Small Flag Malaysia

A taxpayer is required to maintain their business records for a period of 7 years. As regards to the filing of tax returns, it must be done annually within 7 months upon the closing of accounts.

Meanwhile, companies are required to file their audited accounts every year with the Companies Commission of Malaysia.

Ireland Small Flag Ireland

The requirement to retain records and file returns varies by tax head; as a general rule however documents must be retained for a period of 6 years.

A taxpayer must file an annual corporation tax return within 9 months of the relevant financial period. Other returns are filed more frequently e.g. payroll taxes, VAT etc. which can be filed monthly or bi-monthly. Withholding tax returns are usually filed in the month following the relevant payment. For example a monthly filing is required for payroll taxes as well as an annual filing.

Records must be maintained for a period of at least five years following the end of the relevant financial period or payment (although sometimes a six year retention period is required). This broadly equates to the period of time in which the Revenue have the ability to audit under normal circumstances.

France Small Flag France

Procedural obligations To be filed
Corporate income tax return (Form 2065) Within 3 months of the end of each tax year

For companies closing their accounts on December 31st, it is to be filed by the second working day following May 1st of the following year

Transfer pricing return (Form 2257) includes general information about the group’s activities and intangible assets of and more specific information about the French subsidiary transactions with related entities Within 6 months of the filing of the corporate income tax return
Country by country report (Form 2258) Within 12 months of the end of the tax year
Value added tax returns (Form 3310) On a monthly basis
Contribution on added value of enterprises return ("Cotisation sur la valeur ajoutée" - CVAE) By the second working day following May 1st of the year following the year in which CVAE is due
Investment income (“Imprimé Fiscal Unique”, Forms 2561) concerning entities paying investment income (dividend and interest) By February 15th

Australia Small Flag Australia

There are numerous different taxation regimes across Australia. Each has different reporting obligations and different record retention requirements. At the Federal level general obligations include:

  1. an obligation to keep and maintain appropriate records for 5 years;
  2. lodge an annual income tax return (within 3 months after the end of the entity's income year);
  3. lodgement of a quarterly (or monthly for large businesses) "business activity statement" (BAS) for goods and services tax (GST); and
  4. prepare and provide PAYG summaries (employers only) in relation to tax amounts withheld from employee wages.

Under the new transfer pricing provisions (see section 19), the Commissioner has 7 years within which to issue an amended assessment to adjust for a transfer pricing benefit. The transfer pricing regime imposes substantial penalties and those penalties will vary considerably depending on the circumstances. One important factor is whether a taxpayer has a 'reasonably arguable position' that the transfer pricing provision should not apply. Relevantly, a taxpayer is deemed to not have a reasonably arguable position unless they have retained contemporaneous transfer pricing documentation (ie documents describing the arm's length conditions, the methods used etc). The corollary of this is that taxpayer's will need to retain their transfer pricing records for 7 years.

Switzerland Small Flag Switzerland

Taxpayers are required to file tax returns each year. Tax returns are generally due by March 31st of the following calendar year for individuals, and for corporations following the approval of the statutory financial statements but at the latest 6 months after the financial statements closing date. Extensions of time to file a return are available. Companies and individuals generally are required to make monthly payments of their estimated tax liability.

Typically, taxpayers are required to maintain adequate records for at least ten years.

Updated: March 10, 2017