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Who are tax intermediaries? 

Tax advisers

 Accountants

Lawyers

Financial institutions

Why are they considered as tax intermediaries?

Tax Compliance: tripartite relationship between Taxauthorities, Taxpayers and tax professionals.

Taxpayers do not necessarily understand the whole taxrules

Tax authorities (particularly tax inspectors) do not have

necessarily the right interpretation of some tax rules.

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The role of Tax professionals: helping taxpayers

understand and comply with their tax obligations in anincreasingly complex domestic and international tax

regulation.

The scope of the tax professional’s  role depends onwhether the taxpayer’s  finance team includes tax

specialists or not.

Would compliance with tax laws improve if tax

intermediaries did not exist?

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Tax due diligence Help investors understanding the business of the

target

Determine the major tax risks to which the target is

exposed Provide the main features of the tax regime applicable

to the target

Provide the main available tax incentives

Determine any pending tax litigations with tax

authorities

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  The pricing level of the transaction will take into

consideration:

Tax liabilities and risks

Tax incentives

Even the vendor may appoint a professional to do thesame work (Vendor due diligence).

Where reports prepared by both professionals are not

consistent, meetings will be held to reconcile their

positions.

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Tax compliance:

Bookkeeping Preparation and submission of tax returns

Tax assistance: reconciliation between accounting

figures and declared taxes

Certifying the tax return before submission

Tax audit

 Assessment of an entity’s tax exposure  Scope of work: more detailed than a tax due

diligence (examination of invoices, contracts and

other supporting documents…) 

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Tax advisory

 Answering taxpayers’ queries regarding tough

issues

When answering a taxpayer’s queries, Tax

professionals refer to the regulation in force andguidelines issued by tax authorities (public rulings,

private rulings). Adjustments introduced during

previous tax controls are as well taken into

consideration.

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  Complying with professional standards and legalobligations is a must for professionals.

 Accounting standards (IFRS/ Local GAAP)

These standards prescribe the level of details to be

disclosed within financial statements.

 Audit standards (IFAC’s standards)These standards prescribe the audit approach as

well as the auditor’s diligences.

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The role of the auditor is to conclude whether or notfinancial statements are prepared, in all material

respects, in accordance with the applicable financial

reporting framework.

Tax regulations

Some countries oblige taxpayers to:

- have tax returns certified by tax professionals

(who engage their responsibility in case of fraud)

- disclose the identity of their tax adviser