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Tax authorities and deferral of payment: no opposition, but a payment arrangement

Introduction

The Tax And Customs Administration has the right to collect tax debts directly without the intervention of the court by seizing, among other things, your bank account, wages, rental income and real estate. In view of this far-reaching power, the legislature previously provided in Article 17(2) of the Recovery Act 1990 that it could be opposed to recovery. This resistance is also called 'fiscal resistance' and had a suspensive effect. The recovery ('execution of the injunction') had to be suspended until the court ruled on the objection.

Change of the law

In 2018, the above suspension effect will no longer apply. The background to this amendment is that too few opposition proceedings were found to be well founded by the court coupled with the increase in the number of opposition proceedings. The Tax And Customs Administration claimed to be hindered in the collection of taxes. For this reason, the legislature has deprived the suspensive effect of the tax opposition.

What now?

That which is due must be paid. The question is how much is due and how can be paid. Sometimes a taxpayer lacks liquidity or another reason is at the root of the impossibility of paying at that particular time. A payment plan is a solution to that problem. Since the change in the law, it has been important to request a payment arrangement in good time (request a postponement).

Solution

Request for deferral of payment or a payment arrangement is currently the first step that must be taken in the event of imminent coercive recovery by the Tax Authorities.

The Tax And Customs Administration has made two forms available for the deferral request: for entrepreneurs with business tax debts such as sales tax and for individuals who, for example, have to pay income tax. In some cases, both forms must be submitted.

During the examination of a request for postponement, the Tax And Customs Administration acts as if the request has been granted. The (coercive) recovery is therefore provisionally suspended.

If the request for postponement is rejected, please note that an objection can be lodged within 10 days. This objection period is shorter than the usual objection period of 6 weeks.

Guidance

Faced with the forced recovery or non-compulsory collection of taxes and levies by the Tax Authorities? Are you an entrepreneur and do you want professional support in requesting a postponement or do you have questions about the (coercive) recovery by the tax authorities? Please feel free to contact me Mr. Sepehr Yadegari. You can also contact me by phone. The phone number is: 020 – 244 3900.