Tax Lawyer

The start of a tax audit, or an unexpected assessment notice, means both a serious financial burden and the need to make decisions quickly, for businesses and individuals alike. As a tax lawyer in Mersin, I provide legal support to taxpayers during tax audits; in settlement and court proceedings against tax and penalty assessment notices; in allegations concerning fictitious documents or documents that are misleading as to their content; in VAT refund disputes; and in objections to payment orders. Time limits in tax disputes are short, and once missed there is often no way back. Early choices, such as whether to apply for settlement or go straight to court, directly affect the outcome and the options that remain afterwards.

What Does a Tax Lawyer Help With?

• Protecting the taxpayer’s rights against the audit minutes and the tax audit report during a tax audit
• Deciding on the route to take against tax and penalty assessment notices
• Settlement negotiations before and after the tax assessment
• Court actions before the tax court to annul the assessment and the penalties
• Challenging tax loss penalties, irregularity penalties and special irregularity penalties
• Allegations of issuing or using fictitious documents or documents misleading as to their content
• Exporters’ VAT refund claims and disputes over refused refunds
• Court actions against payment orders and steps at the collection stage
• Appeals against tax court decisions to the regional administrative court and the Council of State

Tax Audit and Tax Audit Report

A tax audit (vergi incelemesi) is an examination of whether the declared tax base is correct, carried out on the basis of the taxpayer’s books, documents and records. The tax inspector asks for the books and documents to be produced, requests explanations and records the findings in official minutes (tutanak). Every written explanation given and every set of minutes signed at this stage may later become the basis of the report. For this reason, minutes should be read carefully before signing, and you should record a written reservation (şerh) on any finding you do not agree with. Failure to produce the requested books and documents may lead to the tax base being assessed ex officio (re’sen takdir).

The tax audit report prepared at the end of the audit forms the basis of the tax assessment and is served on the taxpayer together with the assessment notice. The findings, comparisons and legal reasoning on which the report relies are the starting point of the defence at the settlement and court stages. Calculation errors, documents that were not taken into account, and general findings based on a report about another taxpayer should be examined in detail at this stage.

Tax Assessment and Penalty Notice

On the basis of the audit report or its own findings, the tax office assesses the tax that was under-declared or not declared at all (tarhiyat) and notifies the taxpayer with a tax/penalty assessment notice (vergi/ceza ihbarnamesi). Once the notice is served, several time limits start to run at the same time: the request for settlement, the filing of a court action and the penalty reduction provided by law all depend on this date. Whether service was made in accordance with the rules, and in particular whether the date of service of an electronic notification has been determined correctly, is important for calculating these time limits.

When a notice arrives, three main options are considered: applying for settlement, bringing a court action before the tax court, or paying under the conditions set by law without going to court and benefiting from the penalty reduction. These options affect one another; for example, no court action can be brought on matters agreed in a settlement. The right route should be chosen by looking together at the weak points of the report, the size of the amount and the situation of the business.

Settlement Before and After Assessment

Settlement (uzlaşma) is a way of resolving tax disputes between the tax administration and the taxpayer without going to court. Pre-assessment settlement (tarhiyat öncesi uzlaşma) is requested after a tax audit, before any tax has been assessed. Post-assessment settlement (tarhiyat sonrası uzlaşma) can be requested by applying within 30 days of service of the assessment notice. If no agreement is reached on a matter for which pre-assessment settlement was requested, post-assessment settlement cannot be requested for the same matter; this is why the stage at which you apply is an important decision.

Settlement covers the principal tax and the tax loss penalty; irregularity and special irregularity penalties cannot be the subject of settlement. If a settlement is reached, the settlement minutes become final and no court action can be brought on the matters agreed. If no settlement is reached and the time limit for a court action has already expired or less than fifteen days of it remain, a court action may be brought within 15 days of service of the minutes recording that no settlement was reached. For details, see the tax settlement page.

Court Action Before the Tax Court

Where settlement is not pursued or no settlement is reached, an action for annulment is brought before the tax court (vergi mahkemesi) against the assessment and the penalties. The time limit for bringing the action is 30 days from service of the assessment notice. As a rule, filing a court action before the tax court suspends the collection of the tax and penalty in dispute; an action filed in time therefore also protects the taxpayer from pressure to pay while the case is pending. The competent court is the tax court for the place where the tax office that carried out the act is located.

The statement of claim sets out, together with documents and commercial records, why the findings in the audit report are contrary to the law and to the facts. Because tax cases are conducted largely in writing, the objections raised and the evidence submitted in the first petition are decisive.

Tax Loss and Irregularity Penalties

A tax loss penalty (vergi ziyaı cezası) is imposed when tax is not assessed on time or is assessed at too low an amount, and it usually comes together with the tax assessment. Irregularity and special irregularity penalties (usulsüzlük ve özel usulsüzlük cezaları), on the other hand, are imposed for failure to comply with formal obligations such as bookkeeping, issuing documents and making notifications, regardless of any loss of tax. For each penalty, the following should be checked separately: whether the act actually took place, whether the penalty was calculated under the correct provision and on the correct base, and whether the limitation period has expired. If the tax assessment is annulled, the tax loss penalty attached to it is annulled as well. For details, see the tax penalties page.

Allegations of Fictitious and Misleading Documents

A large share of tax audits concern allegations that the invoices received were not based on any real delivery of goods or services. A document issued without any real transaction is classified as a fictitious document (sahte belge); a document that is based on a real transaction but does not reflect the truth as to its nature, quantity or amount is classified as a document misleading as to its content (muhteviyatı itibarıyla yanıltıcı belge). For the taxpayer who used the document, these allegations may lead to the rejection of expense and VAT deductions, to a tax loss penalty, and also to criminal proceedings for the offence of tax evasion under the Tax Procedure Law (VUK).

In these files, every element that shows the transaction was real matters: payments made through a bank, delivery notes, transport documents, stock records and the onward sale of the goods. The tax case and the criminal case proceed independently of each other, but the defence in the two files must be consistent.

VAT Refund Disputes

Because export deliveries are exempt from VAT, exporters recover the VAT they have paid on their purchases by way of a refund. Refund claims are concluded on the basis of a report by a sworn financial adviser (yeminli mali müşavir), a tax audit report or the provision of security (teminat). In practice, the most common problem is that the refund is suspended, security is requested or the claim is partly refused because of a negative finding about one of the companies from which the exporter bought goods. In such cases, the exporter needs to document that its own purchases were real and the care it took when choosing its suppliers. A court action may also be brought before the tax court against the refusal of a refund claim or against a tax assessment made because of the refund.

Objecting to a Payment Order

For taxes and penalties not paid by the due date, the tax office issues a payment order (ödeme emri). Within 7 days of service of the payment order, the debt must be paid or a declaration of assets must be made. A court action may be brought before the tax court against the payment order within 15 days of service, on the grounds that the debt does not exist, has been partly paid or is time-barred. If the payment order was issued for a debt that is not yet final, because it is based on an assessment notice that was never properly served, this should also be raised separately in the action. The same time limit applies to payment orders sent to legal representatives of a company because of the company’s tax debt.

Appeals

An appeal (istinaf) against a tax court decision may be lodged with the regional administrative court (bölge idare mahkemesi) within 30 days of service of the decision. Against decisions of the regional administrative court, an appeal on points of law (temyiz) may be lodged with the Council of State (Danıştay), in the cases listed in the law, again within 30 days of service. Which decisions can be appealed at each level depends on the type of dispute and on the monetary thresholds set by law; so, when a decision is served, the first step is to establish which appeal route is available. Since lodging an appeal does not automatically suspend the enforcement of the decision, a request for a stay of execution (yürütmenin durdurulması) is also considered separately in order to prevent collection.

Assessing Tax Risks in Advance for Companies

Tax law does not only become relevant once a penalty or dispute arises. If the choice of suppliers, the organisation of invoices and delivery documents, transactions with shareholders and high-value contracts are reviewed from a legal point of view in advance, situations that would be hard to defend in a later tax audit can be avoided.

Tax Cases and Tax Offices in Mersin

In tax cases, the competent court is the tax court for the place where the tax office that carried out the act is located. Therefore, actions against assessments, penalties and collection measures of the tax offices under the Mersin Tax Office Directorate (Mersin Vergi Dairesi Başkanlığı) are heard by the tax courts in Mersin. As a rule, acts of the tax offices in districts such as Tarsus, Erdemli, Silifke, Mut and Anamur also fall within the jurisdiction of these courts. Exporters and logistics companies operating around the Port of Mersin and the Mersin Free Zone frequently face tax audits because of VAT refunds, negative findings about their suppliers and allegations concerning documents. Agricultural and industrial businesses in the province may also be audited because of purchase documents, stock differences and record-keeping. For companies based in other cities and taxpayers living outside the province, I can handle the process from here as your tax lawyer under a power of attorney (vekâletname).

Frequently Asked Questions