Tax Dispute Resolution

Most TP assessments stem from negligence, where the taxpayer uses a simplistic TP model with too little depth, or one that is outdated and no longer corresponds with reality. Therefore, it’s intriguing to come across a case where tax authorities alleged that the taxpayer used a TP model that was 𝘵𝘰𝘰 𝘦𝘭𝘢𝘣𝘰𝘳𝘢𝘵𝘦, and insisted on something rather simplistic instead. 𝗦𝘂𝗺𝗺𝗮𝗿𝘆 Spanish sub participated in the group's cash pooling managed by a related Dutch FinCo. The cash pooling involved daily zero-balancing of accounts with entities providing or borrowing funds via the pool. Group applied different interest rates based on individual entity credit ratings for deposits and loans. The Spanish tax authorities (STAs) contested this, insisting that TP required symmetrical interest rates and the use of the group's consolidated credit rating, arguing that the pool leader only performed administrative functions. The Supreme Court upheld the STA's position in the dispute for the 2014-15 tax years. 𝗪𝗵𝗮𝘁’𝘀 𝘄𝗿𝗼𝗻𝗴 𝘄𝗶𝘁𝗵 𝘁𝗵𝗶𝘀 𝗰𝗮𝘀𝗲? 1) 𝘖𝘷𝘦𝘳𝘳𝘦𝘭𝘪𝘢𝘯𝘤𝘦 𝘰𝘯 𝘨𝘳𝘰𝘶𝘱 𝘤𝘳𝘦𝘥𝘪𝘵 𝘳𝘢𝘵𝘪𝘯𝘨 𝘪𝘨𝘯𝘰𝘳𝘦𝘴 𝘦𝘯𝘵𝘪𝘵𝘺–𝘴𝘱𝘦𝘤𝘪𝘧𝘪𝘤 𝘤𝘳𝘦𝘥𝘪𝘵 𝘳𝘪𝘴𝘬. The Court mandates using the overall group credit rating instead of the individual credit rating of each subsidiary. This disregards that subsidiaries may have materially different credit profiles. From an arm’s length perspective, independent parties would price loans based on the borrower’s specific credit risk, making the group rating a potential proxy but certainly not something that should be held up as a universal standard. 2) 𝘚𝘺𝘮𝘮𝘦𝘵𝘳𝘪𝘤𝘢𝘭 𝘪𝘯𝘵𝘦𝘳𝘦𝘴𝘵 𝘳𝘢𝘵𝘦𝘴 𝘤𝘰𝘯𝘧𝘭𝘪𝘤𝘵 𝘸𝘪𝘵𝘩 𝘮𝘢𝘳𝘬𝘦𝘵 𝘱𝘳𝘢𝘤𝘵𝘪𝘤𝘦. The Court requires symmetrical interest rates, disregarding the widely accepted financial market reality that interest rates on deposits and loans are asymmetric. Independent parties typically apply higher rates on loans than on deposits to reflect risk and liquidity premiums and other factors. While the use of symmetric rates could be accepted as a proxy in certain situations, holding it up as a universal standard seems quite dogmatic. 3) 𝘊𝘢𝘴𝘩 𝘱𝘰𝘰𝘭 𝘭𝘦𝘢𝘥𝘦𝘳'𝘴 𝘶𝘯𝘪𝘧𝘰𝘳𝘮 𝘤𝘩𝘢𝘳𝘢𝘤𝘵𝘦𝘳𝘪𝘴𝘢𝘵𝘪𝘰𝘯. The case treats the cash pool leader as an administrative agent without much substance, limiting remuneration to a small fee. While this can sometimes be correct, it’s not fully clear that the Dutch FinCo indeed had such a profile. The pool leader can face financial exposure, including net interest margin risks and operational risks. In conclusion, the court seems to apply a rigid, generalized framework rather than a nuanced functional and economic analysis. If there’s one lesson here, it’s perhaps that when the only instrument you have is a hammer, then every problem looks like a nail. Source: https://lnkd.in/eXZvtgzw

Errors in filing returns should be permitted if they meet these two conditions: 1. It was a clerical error made without any intention to evade taxes. 2. Revenue Neutral: The error resulted in no change to the overall revenue. Please bookmark/save this post for Drafting Replies. 1. Kerala High Court 1.1 Jayakrishnan K.S (2024) Assessee wrongly claimed IGST credit under CGST and SGST in GSTR 3B. AAR. The revenue authority is directed to consider the rectification application promptly. 1.2 Divya S. R. (2024) Where assessee by mistake claimed entire IGST credit under heads of CGST & SGST instead of claiming it under IGST and filed rectification application before Authorities, said application of assessee was to be considered and necessary order was to be passed. 2. Bombay High Court 2.1 NRB Bearings Ltd. (2024) ARR: When a clerical error in the GSTR-1 return led to the denial of Input Tax Credit for the recipient-respondent without any revenue loss, the High Court allowed the assessee to rectify the error. 2.2 Anvita Associates (2024) Where the assessee unintentionally omitted to disclose certain sales invoices in Form GSTR-1, resulting in those invoices not being reflected in Form GSTR-2A of their customer, the assessee is instructed to submit an application for rectification of Form GSTR-1 for the relevant period to the appropriate GST authorities. The authorities will then evaluate the request in compliance with the law. ARR 2.3 Railroad Logistics (India) (P.) Ltd. (2024) Where assessee made an inadvertent error in submitting GST number of Mahindra & Mahindra (Rajasthan) in its form GSTR-1 instead of correct GST number of Mahindra & Mahindra (Orissa), said dispute was not a case where any loss of revenue would be caused to government as already tax had been paid, therefore reification was to be permitted to assessee. 3. Madras High Court 3.1 Kondamma Trading (2023) Where representation was made by assessee to rectify GSTR-3B for shifting ITC from one head to another but department rejected it, rights were available to assessee to correct mistake by filing a rectification application U/s161; assessee should file a rectification application. I hope you will find this useful. Best Regards, Abhishek Raja Ram 9810638155

📢 𝗧𝗿𝗮𝗻𝘀𝗳𝗲𝗿 𝗣𝗿𝗶𝗰𝗶𝗻𝗴 – 𝗧𝗵𝗲 𝗜𝗻𝘁𝗲𝗿𝗻𝗮𝗹 𝗖𝗨𝗣 𝗦𝘁𝗿𝗶𝗸𝗲𝘀 𝗔𝗴𝗮𝗶𝗻! 💡 On 𝟭𝟲 𝗝𝘂𝗻𝗲 𝟮𝟬𝟮𝟱, the 𝗔𝗻𝘁𝘄𝗲𝗿𝗽 𝗖𝗼𝘂𝗿𝘁 𝗼𝗳 𝗙𝗶𝗿𝘀𝘁 𝗜𝗻𝘀𝘁𝗮𝗻𝗰𝗲 ruled in favour of the Belgian Tax Authorities in a transfer pricing case involving 𝗶𝗻𝘁𝗿𝗮𝗴𝗿𝗼𝘂𝗽 𝗳𝗶𝗻𝗮𝗻𝗰𝗶𝗻𝗴. The dispute revolved around a 𝟱% 𝗳𝗶𝘅𝗲𝗱-𝗿𝗮𝘁𝗲 𝘀𝗵𝗮𝗿𝗲𝗵𝗼𝗹𝗱𝗲𝗿 𝗹𝗼𝗮𝗻 used to finance an acquisition, while the same company had obtained an 𝗲𝘅𝘁𝗲𝗿𝗻𝗮𝗹 𝗯𝗮𝗻𝗸 𝗹𝗼𝗮𝗻 (EURIBOR + 1.75%) from ING on identical terms and the same date. ⚖️ 𝗧𝗵𝗲 𝗰𝗼𝘂𝗿𝘁’𝘀 𝘃𝗶𝗲𝘄: The tax authorities were right to apply the 𝗶𝗻𝘁𝗲𝗿𝗻𝗮𝗹 𝗖𝗼𝗺𝗽𝗮𝗿𝗮𝗯𝗹𝗲 𝗨𝗻𝗰𝗼𝗻𝘁𝗿𝗼𝗹𝗹𝗲𝗱 𝗣𝗿𝗶𝗰𝗲 (𝗖𝗨𝗣) 𝗺𝗲𝘁𝗵𝗼𝗱 — using the 𝗲𝘅𝘁𝗲𝗿𝗻𝗮𝗹 𝗯𝗮𝗻𝗸 𝗹𝗼𝗮𝗻 𝗮𝘀 𝗮 𝗯𝗲𝗻𝗰𝗵𝗺𝗮𝗿𝗸 and adjusting it for differences (subordination, fixed vs. floating, and repayment terms). After adjustments, the court held that an 𝗮𝗿𝗺’𝘀 𝗹𝗲𝗻𝗴𝘁𝗵 𝗿𝗮𝘁𝗲 𝗼𝗳 𝟯.𝟯𝟮% 𝘀𝗵𝗼𝘂𝗹𝗱 𝗮𝗽𝗽𝗹𝘆, rejecting the excess 1.68% as a non-deductible expense under Article 55 BITC. 🔍 𝗞𝗲𝘆 𝘁𝗮𝗸𝗲𝗮𝘄𝗮𝘆𝘀: – The court confirmed the 𝗽𝗿𝗲𝗳𝗲𝗿𝗲𝗻𝗰𝗲 𝗳𝗼𝗿 𝘁𝗵𝗲 𝗶𝗻𝘁𝗲𝗿𝗻𝗮𝗹 𝗖𝗨𝗣 whenever a comparable transaction exists — even if adjustments are necessary. – 𝗔𝗿𝘁𝗶𝗰𝗹𝗲 𝟱𝟱 𝗕𝗜𝗧𝗖 continues to serve as a powerful tool in financial TP cases, reinforcing the taxpayer’s burden of proof to justify that interest is not excessive. – The decision reflects a broader trend: 𝘁𝗵𝗲 𝗕𝗲𝗹𝗴𝗶𝗮𝗻 𝘁𝗮𝘅 𝗮𝘂𝘁𝗵𝗼𝗿𝗶𝘁𝗶𝗲𝘀 𝗶𝗻𝗰𝗿𝗲𝗮𝘀𝗶𝗻𝗴𝗹𝘆 𝗲𝘅𝗽𝗲𝗰𝘁 𝘁𝗮𝘅𝗽𝗮𝘆𝗲𝗿𝘀 𝘁𝗼 𝘀𝘁𝗮𝗿𝘁 𝘁𝗵𝗲𝗶𝗿 𝗽𝗿𝗶𝗰𝗶𝗻𝗴 𝗳𝗿𝗼𝗺 𝗶𝗻𝘁𝗲𝗿𝗻𝗮𝗹 𝗯𝗲𝗻𝗰𝗵𝗺𝗮𝗿𝗸𝘀, not external databases. – The judgment also comes with a 𝟭𝟬% 𝘁𝗮𝘅 𝗶𝗻𝗰𝗿𝗲𝗮𝘀𝗲 for incorrect filing, reminding taxpayers that documentation failures can carry immediate financial consequences. 💼 𝗜𝗻 𝗽𝗿𝗮𝗰𝘁𝗶𝗰𝗲: Intragroup financing remains a 𝗵𝗶𝗴𝗵-𝗿𝗶𝘀𝗸 𝗮𝗿𝗲𝗮 in Belgium. A robust, 𝘄𝗲𝗹𝗹-𝗱𝗼𝗰𝘂𝗺𝗲𝗻𝘁𝗲𝗱 𝗖𝗨𝗣 𝗵𝗶𝗲𝗿𝗮𝗿𝗰𝗵𝘆 𝗮𝗻𝗮𝗹𝘆𝘀𝗶𝘀 is essential to withstand audit scrutiny. Even minor deviations between internal and intercompany loans must be justified — otherwise, the tax authorities (and now the courts) will likely 𝗽𝗿𝗶𝗰𝗲 𝗶𝘁 𝗳𝗼𝗿 𝘆𝗼𝘂. Fieldfisher Belgium École Supérieure des Sciences Fiscales (ICHEC-ESSF) #TransferPricing #CUPMethod #Belgium #CorporateTax #ArmLength #Article55 #TaxLaw #MNE #TPDocumentation #IntercompanyFinancing #CourtDecision

𝐂𝐚𝐧 𝐭𝐡𝐞 𝐃𝐆𝐓 𝐑𝐞𝐯𝐢𝐬𝐞 𝐎𝐛𝐣𝐞𝐜𝐭𝐢𝐨𝐧 𝐃𝐞𝐜𝐢𝐬𝐢𝐨𝐧𝐬 𝐃𝐮𝐫𝐢𝐧𝐠 𝐚𝐧 𝐎𝐧𝐠𝐨𝐢𝐧𝐠 𝐓𝐚𝐱 𝐂𝐨𝐮𝐫𝐭 𝐇𝐞𝐚𝐫𝐢𝐧𝐠? A recurring question in tax court is whether the DGT can legally revise an objection decision during an ongoing tax court hearing. These amendments typically address clerical errors or procedural issues, but the central question is whether such corrections are legally acceptable after a decision is already under court review. 𝗩𝗶𝗲𝘄𝘀 𝗦𝘂𝗽𝗽𝗼𝗿𝘁𝗶𝗻𝗴 𝗖𝗼𝗿𝗿𝗲𝗰𝘁𝗶𝗼𝗻𝘀 𝗗𝘂𝗿𝗶𝗻𝗴 𝗣𝗿𝗼𝗰𝗲𝗲𝗱𝗶𝗻𝗴𝘀 Supporters of allowing the DGT to amend decisions cite Article 16 of the KUP Law, which permits rectification without a time limit, provided there is no additional tax in dispute. This interpretation gives the DGT the flexibility to make corrections to minor errors during court hearings. Article 31(2) of the Tax Court Law limits reviews to the material disputes in the appellant’s original objection, focusing only on substantial issues, not minor errors. Proponents argue that if a DGT correction doesn’t change the appeal's substance, the court should accept it. 𝗔𝗿𝗴𝘂𝗺𝗲𝗻𝘁𝘀 𝗔𝗴𝗮𝗶𝗻𝘀𝘁 𝗖𝗼𝗿𝗿𝗲𝗰𝘁𝗶𝗼𝗻𝘀 𝗗𝘂𝗿𝗶𝗻𝗴 𝗣𝗿𝗼𝗰𝗲𝗲𝗱𝗶𝗻𝗴𝘀 Opponents argue that allowing corrections during hearings violates Article 26(1) of the KUP Law, which gives the DGT a strict 12-month limit for objection decisions. Amendments after this could render the decision legally flawed and could invalidate the decision. Further, Article 50 of the Tax Court Law explains that if an appeal is unclear or incomplete, the opportunity to provide clarity or completeness can be offered during the trial. The law implies that this chance to clarify or complete an appeal is granted solely to taxpayers, not to the DGT. Opponents emphasize that mid-hearing corrections disrupt the appellant’s ability to rely on a consistent, clear decision. Allowing the DGT to amend decisions during proceedings introduces unpredictability and may weaken confidence in judicial impartiality. 𝗧𝗿𝗲𝗻𝗱𝘀 𝗶𝗻 𝗧𝗮𝘅 𝗖𝗼𝘂𝗿𝘁 𝗥𝘂𝗹𝗶𝗻𝗴𝘀 The tax court has addressed this issue in several recent cases, often concluding that minor, non-material errors do not render the objection decision invalid if corrected. Judges have frequently advised taxpayers that, rather than disputing procedural errors through an appeal, they should consider filing a lawsuit under Article 23 (2d) the KUP Law. This article permits the filing of lawsuits against decisions issued without following procedural standards, creating a pathway for handling formal errors separately from material disputes. In conclusion, whether the DGT can correct an Objection Decision during tax court proceedings remains an evolving issue. Taxpayers must be prepared to navigate this complexity, ensuring their arguments are well-positioned to address both material and formal aspects of their appeal effectively. #gnvconsulting #taxdisputes #taxcourt #taxcontroversy

Investment treaties rarely define 'taxation' or 'tax measures', except for a few instances like the Energy Charter Treaty in 1998, which provides a detailed definition; in these cases where a definition is lacking, tribunals often follow the approach established in EnCana v Ecuador. This approach considers a taxation measure to be any aspect of a tax regime that determines the amount of tax payable or refundable, including enforcement. Accordingly, this approach emphasizes that the question of whether something is a tax measure is primarily a matter of its legal operation, not its economic effect. A key issue that arises in the context of tax is whether it can be resolved through arbitration, & if so, whether tribunals have the jurisdiction to do so. In general, matters of public interest (in rem) are considered non-arbitrable, leading some states to argue that tribunals lack the power to decide on tax-related claims. However, except in cases where there is an explicit exception, these arguments have typically been dismissed, allowing tribunals to hear and decide on tax-related disputes. A recent example that illustrates this is the case of Cairn v India. In this case, Cairn Group restructured its Indian operations in 2006, transferring assets from Cairn UK to Cairn India. However, India later changed its tax laws to target offshore transactions involving Indian assets, retroactively applying capital gains tax from 1962. In 2015, Cairn was issued a $1.4 billion tax demand, plus interest and penalties, for the asset transfer. Cairn initiated arbitration under the UK-India BIT, arguing that India's retroactive tax measures breached the treaty. India argued that the dispute related to tax matters, & alleged that this went beyond the tribunal’s jurisdiction. The tribunal rejected India's argument that the dispute related to tax matters was outside its jurisdiction. Instead, the tribunal found that the case involved determining whether India's conduct in tax matters breached the BIT's standard of protection, rather than deciding whether a particular transaction should be taxed. The tribunal also addressed India's claim that tax disputes are not arbitrable under Dutch law, Indian law, or international public policy. The tribunal agreed that Dutch law and international law are relevant to the arbitrability of the claims, but found that Indian law is not pertinent, as India cannot rely on its domestic law to defeat its BIT obligations. Furthermore, the tribunal cautioned against applying domestic rules on arbitrability, which pertain to commercial arbitration, to investor-state disputes. The tribunal concluded that the dispute is not a "tax dispute" but rather a dispute relating to tax matters, rendering India's arguments moot. Finally, the tribunal was unpersuaded by India's contention that customary international law places few limits on a state's conduct in tax matters, finding this relevant only to the merits, not the tribunal's jurisdiction.

When a ₹4 crores tax notice landed on my client's desk... An automobile business with 13 outlets across India faced a notice alleging suppression of facts regarding ₹4 crores of service tax returns. Authorities extended limitation period because no service tax returns were filed for one unit in Nanden, despite TDS being deducted. Department confirmed the demand in the order in original (OIO), ignoring the evidence proving returns were assessed under centralised tax registration. Petitioner had to deposit ₹30+ lakhs (10% of the disputed amount) to approach Commissioner Appeals. Here’s how I approached it: 1) Filed writ petition in the High Court. 2) Compiled documents proving service tax payments under the centralised tax system. 3) Presented centralised audit records to the court. Results: ↳ Court remanded the case to Adjudicating Authority. ↳ Client avoided making any additional deposits for the appeal. ↳ Showcause notice is under review, with final order expected soon. The right legal approach can save your business from significant setbacks and unnecessary losses.

Transfer Pricing Benchmarks Disputes: Update from Ukraine's Courts 🔍 How often do tax authorities challenge benchmarks? Pretty often. That's why staying informed about global TP dispute trends is crucial. 🇺🇦 It's encouraging to see Ukraine as a jurisdiction where in-depth transfer pricing disputes are resolved fairly and transparently. A recent case (Olympex Coupe International LLC vs. tax authorities) showcases this progress. 📊 The taxpayer applied a traditional approach: TNMM with full cost mark-up PLI Broad set of local comparables (14-16 companies) Standard screening criteria (independence, financials, functions) 💼 The tax authorities, aiming to increase the arm's length range, took an interesting approach: Agreed on method and PLI Added criteria/filters: comparable asset size and deep-water port locations (local geography) This resulted in a drastically reduced set (2-3 comparables) and a higher range ⚖️ The court ultimately sided with the taxpayer, finding the tax authorities' additional criteria insufficiently justified. 🎯 Key takeaway: The importance of robust benchmarks cannot be overstated. A well-documented, justifiable approach to selecting comparables is your best defense in transfer pricing disputes. Are your benchmark studies ready for such scrutiny? Let's discuss best practices in the comments!

Sec. 68 of the Indian Income Tax Act and evidential value of a taxpayer’s explanations. This provision is the principal subject matter in a rather large number of tax disputes, involving even many companies. Sec. 68 stipulates that where any amount is found credited in a taxpayer’s books of account and if either no explanation is offered about the nature and source thereof—or the explanation offered by the taxpayer is not satisfactory in the tax authorities’ opinion—then such amount would be treated as taxable income for the relevant tax year. But how—or based on what standards—should the taxpayer’s explanations be evaluated? In that context, it is relevant to note the following guidelines from two important decisions of the Supreme Court of India: #𝟭 “𝗦𝗰𝗶𝗲𝗻𝗰𝗲 𝗵𝗮𝘀 𝗻𝗼𝘁 𝘆𝗲𝘁 𝗶𝗻𝘃𝗲𝗻𝘁𝗲𝗱 𝗮𝗻𝘆 𝗶𝗻𝘀𝘁𝗿𝘂𝗺𝗲𝗻𝘁 𝘁𝗼 𝘁𝗲𝘀𝘁 𝘁𝗵𝗲 𝗿𝗲𝗹𝗶𝗮𝗯𝗶𝗹𝗶𝘁𝘆 𝗼𝗳 𝘁𝗵𝗲 𝗲𝘃𝗶𝗱𝗲𝗻𝗰𝗲 𝗽𝗹𝗮𝗰𝗲𝗱 𝗯𝗲𝗳𝗼𝗿𝗲 𝗮 𝗰𝗼𝘂𝗿𝘁 𝗼𝗿 𝘁𝗿𝗶𝗯𝘂𝗻𝗮𝗹. 𝗧𝗵𝗲𝗿𝗲𝗳𝗼𝗿𝗲, 𝘁𝗵𝗲 𝗰𝗼𝘂𝗿𝘁𝘀 𝗮𝗻𝗱 𝗧𝗿𝗶𝗯𝘂𝗻𝗮𝗹𝘀 𝗵𝗮𝘃𝗲 𝘁𝗼 𝗷𝘂𝗱𝗴𝗲 𝘁𝗵𝗲 𝗲𝘃𝗶𝗱𝗲𝗻𝗰𝗲 𝗯𝗲𝗳𝗼𝗿𝗲 𝘁𝗵𝗲𝗺 𝗯𝘆 𝗮𝗽𝗽𝗹𝘆𝗶𝗻𝗴 𝘁𝗵𝗲 𝘁𝗲𝘀𝘁 𝗼𝗳 𝗵𝘂𝗺𝗮𝗻 𝗽𝗿𝗼𝗯𝗮𝗯𝗶𝗹𝗶𝘁𝗶𝗲𝘀”. #𝟮 “… 𝗮𝗽𝗽𝗮𝗿𝗲𝗻𝘁 𝗺𝘂𝘀𝘁 𝗯𝗲 𝗰𝗼𝗻𝘀𝗶𝗱𝗲𝗿𝗲𝗱 𝗿𝗲𝗮𝗹 𝘂𝗻𝘁𝗶𝗹 𝗶𝘁 𝗶𝘀 𝘀𝗵𝗼𝘄𝗻 𝘁𝗵𝗮𝘁 𝘁𝗵𝗲𝗿𝗲 𝗮𝗿𝗲 𝗿𝗲𝗮𝘀𝗼𝗻𝘀 𝘁𝗼 𝗯𝗲𝗹𝗶𝗲𝘃𝗲 𝘁𝗵𝗮𝘁 𝘁𝗵𝗲 𝗮𝗽𝗽𝗮𝗿𝗲𝗻𝘁 𝗶𝘀 𝗻𝗼𝘁 𝘁𝗵𝗲 𝗿𝗲𝗮𝗹 𝗮𝗻𝗱 𝘁𝗵𝗮𝘁 𝘁𝗵𝗲 𝘁𝗮𝘅𝗶𝗻𝗴 𝗮𝘂𝘁𝗵𝗼𝗿𝗶𝘁𝗶𝗲𝘀 𝗮𝗿𝗲 𝗲𝗻𝘁𝗶𝘁𝗹𝗲𝗱 𝘁𝗼 𝗹𝗼𝗼𝗸 𝗶𝗻𝘁𝗼 𝘁𝗵𝗲 𝘀𝘂𝗿𝗿𝗼𝘂𝗻𝗱𝗶𝗻𝗴 𝗰𝗶𝗿𝗰𝘂𝗺𝘀𝘁𝗮𝗻𝗰𝗲𝘀 𝘁𝗼 𝗳𝗶𝗻𝗱 𝗼𝘂𝘁 𝘁𝗵𝗲 𝗿𝗲𝗮𝗹𝗶𝘁𝘆 𝗮𝗻𝗱 𝘁𝗵𝗲 𝗺𝗮𝘁𝘁𝗲𝗿 𝗵𝗮𝘀 𝘁𝗼 𝗯𝗲 𝗰𝗼𝗻𝘀𝗶𝗱𝗲𝗿𝗲𝗱 𝗯𝘆 𝗮𝗽𝗽𝗹𝘆𝗶𝗻𝗴 𝘁𝗵𝗲 𝘁𝗲𝘀𝘁 𝗼𝗳 𝗵𝘂𝗺𝗮𝗻 𝗽𝗿𝗼𝗯𝗮𝗯𝗶𝗹𝗶𝘁𝗶𝗲𝘀.” I find those landmark decisions of the Supreme Court very interesting and useful in practice, so sharing a soft copy (PDF) of one of those landmark decisions of the Supreme Court—you can read and download through the link provided in the comments section below. #TaxLaw #IndiaTax

You've got a tax bill that's making your eyes water, but you can’t settle it due to your current financial situation. You're stuck between a rock and a hard place – or more accurately, between the IRS and your basic living expenses.  What do you do? The Currently Not Collectible (CNC) status could be the financial breathing room you've been gasping for. The CNC status lets you hit the pause button on your tax debt.  If the IRS agrees that paying your taxes would leave you unable to cover your basic living expenses, they might put your account in CNC status. But it isn't a "get out of jail free" card.  Your tax debt doesn't vanish into thin air. It's more like the IRS saying, "Okay, we'll stop knocking on your door for now."  They won't come after you for collection while you're in this status. But (there's always a but, right?), here's the thing: Interest and penalties will keep piling up.  It's the law.  Which means while you're catching your breath, that debt will continue growing. So, what's the takeaway here?  If you owe IRS taxes but can’t pay due to your financial situation, CNC status could be your life raft.  It's not a permanent solution, but it can give you the breathing room you need to get back on your feet. But always keep this in mind: tax troubles are like quicksand – the more you struggle alone, the deeper you sink.  Don't be afraid to reach out for help.  Whether it's CNC status or another solution, there are ways to work with the IRS and keep your head above water.  Rooting for you.

Owe Back Taxes? Here’s How to Handle It Like a Pro! Let’s be honest—falling behind on taxes can feel overwhelming. But if you’re a small business owner dealing with back taxes, don’t panic! The IRS wants to collect, not punish, and you have options to get back on track. Step 1: Assess the Damage First, figure out exactly how much you owe by checking your IRS account online or calling the IRS. Don’t forget penalties and interest—they add up fast! Step 2: Don’t Ignore IRS Notices If you've received a letter from the IRS, read it carefully and respond by the deadline. Ignoring notices can lead to liens, levies, or even wage garnishments. Step 3: Explore Your Payment Options The IRS offers several ways to resolve back taxes: ✅ Short-Term Payment Plan – If you can pay within 180 days, this is your best bet. ✅ Long-Term Installment Agreement – If you owe under $50K, you may qualify for monthly payments. ✅ Offer in Compromise (OIC) – If paying the full amount would cause serious financial hardship, you may be able to settle for less. ✅ Penalty Abatement – If you have a good reason (illness, natural disaster, etc.), you might get penalties reduced. Step 4: Keep Future Taxes in Check 📌 Make estimated tax payments – If you’re self-employed, set aside funds quarterly. 📌 Automate tax savings – Open a separate account for taxes to avoid surprises. 📌 Work with a tax pro – A good CPA or tax attorney can help you avoid IRS trouble in the future. Owing back taxes is stressful, but taking action now can prevent bigger problems later. If you’re feeling stuck, reach out to a tax professional—you have more options than you think! #SmallBusiness #Taxes #IRS #TaxRelief #EntrepreneurTips