In short, if the operators of the activities collect most of the revenues in cash, problems can arise. In particular, the tax assessment is at risk if the declared income is not proportionate to the economic situation of the company or even the result for the year is a loss. In this case, the assessment will be all the more critical, as it will be the inductive one.
For this we mean a free-foot check by the tax authorities which can reconstruct the amount of taxable revenues. This, without being bound by the accounting results. With a recent ordinance, the n. 18668/20 of 8 September 2020, the Supreme Court has practically rejected the defenses of the taxpayer from scratch. In fact, it fully confirmed the theses of the Revenue Agency, which had redetermined revenues by totally disregarding the accounting records, applying a presumptive reasoning. So, the warning is: be careful not to collect too much cash otherwise you risk tax checks.
Thesis of the Cassation and defeat of the taxpayer
He weighed in the conviction of Supreme Court then, a series of considerations on the uneconomic and unreliable performance of the company ascertained. Furthermore, from the documentation produced by the applicants, it appeared that half of the declared revenues was attributable to cash payments. Therefore, too many collections made in cash arouse suspicion even when, as in the present case, they had been regularly invoiced.
But also in this respect the cut found that the invoices issued did not identify the services rendered. Furthermore, they were generic and imprecise in the description of the goods sold or the services provided. In short, when more than half of the proceeds derive from payments in cash and there is no plausible justification for this, the tax authorities have an easy game in the assessment. And things get worse if the accounting documents fail to disprove the administration’s reconstructions.
Nor does it make it easier for the parameters of the economic activity exercised to deviate too much from the sector averages. It is almost impossible, in these cases, to convince the tax authorities and the tax judges that the activity is carried out for long periods in a completely uneconomic way. Then, the presumptions are triggered. From what has been illustrated, in conclusion it can be deduced that one must be careful not to cashing in too much cash otherwise there is a risk of tax inspections.
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