Tax dispute: what to do under Georgian law

What to do

1. The deadline comes first. A tax authority decision is appealed within 30 days of its service (Tax Code of Georgia, Art. 299). An audit report is appealed together with the tax demand based on it (Art. 299). Later appeals are possible only on new circumstances or for a missed deadline due to reasons beyond one's control (Art. 299).
2. Route: the dispute has two stages, the Revenue Service and then the Dispute Resolution Council of the Ministry of Finance (Art. 297). At any stage one may go to court (Art. 296). A complaint is reviewed within 20 days (Art. 302). The authority's delay may be treated as a refusal (Art. 299). Next, a Revenue Service decision may be taken to the Council or to court within 20 days of service (Art. 305). A Council decision may be taken to court within 20 days of service (Art. 305). If the dispute is not continued within the deadline, the disputed debt is deemed admitted (Art. 305). The applicant's position cannot be made worse in the dispute (Art. 298).
3. Complaint: it must include the ID, contact details, the substance of the claim, a copy of the decision, page numbering, a signature and a power of attorney. To fix a defect, at least 5 days are allowed (Art. 300). Object to each episode of the audit report with primary documents.
4. Break the amount down: tax (the limitation period for additional assessment is 3 years from the end of the year in which the obligation arose) (Art. 4); penalty interest (საურავი) of 0.05% of the tax per day of delay, for no more than 3 years (Art. 272); a fine for understatement in the declaration of up to 50% of the understated amount (Art. 275). No penalty interest is charged on fines (Art. 270).
5. Enforcement during the dispute: payment of the contested amount is suspended from the start of the dispute until it ends (Art. 254). However, attachment of property or accounts is possible, and it is lifted by a surety, a bank guarantee or an insurance policy (Art. 254). A lawsuit does not by itself suspend the tax act (Administrative Procedure Code of Georgia, Art. 29).
6. Where to apply: Revenue Service (შემოსავლების სამსახური), then the Dispute Resolution Council of the Ministry of Finance (დავების განხილვის საბჭო), then the court (administrative panel).
7. Evidence: audit report and tax demand with the service date, primary documents, contracts, invoices, bank statements, declarations, correspondence with the Revenue Service.
8. Traps: missing short deadlines, after which the debt is deemed admitted; appealing the audit report separately from the tax demand; a formal defect in the complaint (no signature, numbering or power of attorney) leading to refusal to consider it; pursuing a dispute in court and at the Ministry of Finance on the same subject at once, in which case the complaint to the Ministry is not considered.

Be sure to check

• the 30-day deadline from service and the subsequent 20-day deadlines
• stages: Revenue Service, then the Ministry of Finance Council, then court (court is available at any stage)
• requirements for the complaint
• composition of the amount: tax, penalty interest of 0.05% per day, fine; what to contest
• suspension of payment of the contested amount and the risk of attachment