Under Article 354 BTC/92, investigations aiming at imposing taxes or tax supplements shall be carried out within three years from 1 January of the fiscal year for which the tax is due. An additional four years time is designed to carry out additional investigations, provided that the administration notified beforehand, in writing and in a precise way the fraud clues (Article 333 and 354 CIR/92)

Seeing the three year deadline expiring, the administration often limits itself to sending to the taxpayer a notification whose clues are not sufficiently relevant, so as to profit from an additional period to investigate the case.

A judgement of the Court of First Instance of Mons, dated 19 October 2009 reminded the parties the scope of the abovementioned provisions.

This decision points out the rule according to which “elements of proof collected after the three years deadline and after the notification, obviously, cannot be retained to justify a posteriori the relevance of the elements mentioned in the notification and shall not be reviewed.”

In the current case, none of the fraud clues mentioned in the notification made it possible to conclude to the fraudulent character of the operation.

Information had been collected subsequently to the notification by the tax authorities.

The Court of First Instance points out that absent relevant elements in the notification of fraud clues, the notification cannot be accepted.

Consequently, the information collected a posteriori and after the three years deadline expired cannot be reviewed.

The importance of the judgement lies especially in the fact that the Court of First Instance confirms that an immediate appeal against the notification of indices of fraud is admissible, and this without having to wait for the taxation.

Daniele COHEN