Joint Audit 2019 – Enhancing Tax Co-operation and Improving Tax Certainty
Forum on Tax Administration
Improved dispute prevention and dispute resolution are key concerns for both business and tax administrations by creating incentives for low-risk behaviour among taxpayers and helping tax administrations to better match resources to tax risks.
Joint Audits are an essential element in the Tax Certainty Agenda and allow tax administrations to operate efficiently and effectively in an increasingly global environment, co-operating ever more closely and frequently with each other to ensure compliance, tackle base erosion and profit shifting, and minimise the probability of costly and time-consuming disputes.
The report sets out the most advanced form of audit-related tax co-operation, provides best practices and identifies possible areas of improvement and future work, not limited to the OECD Forum on Tax Administration.
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The role of the taxpayer
The joint engagement of the participating tax administrations with the taxpayer is a key element of a Joint Audit compared to the conduct of a purely domestic audit. The experience from tax administrations shows that a close and early involvement of the taxpayer provides for the best outcome of a Joint Audit. The precise involvement of the taxpayer will of course depend on the circumstances and there will be differences between a Joint Audit in a co-operative and in a non-co-operative context, but even in the latter case open engagement by tax administrations can sometimes result in a change of taxpayers’ behaviour.
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