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Taxpayers granted right to request tax inspections

The new Decree-Law 6/99 has introduced the possibility of tax inspections being made at the initiative of the taxpayer or of certain interested third parties. This allows the tax situation of taxpayers to be clarified, thus allowing a greater degree of legal certainty in the conduct of transactions.

Such an option is granted to the taxpayer, or to an interested third party, in specific situations only, when evidence is shown that knowledge of the taxpayer's situation would be advantageous (as would be the case for corporate restructuring, economic recovery operations, or access to certain tax benefits).

In general, at the request of the taxpayer, or of an interested third party, the tax administration has a period of 60 days, in which to commence the tax inspection. No period is imposed on the tax administration to complete the tax inspection. However, once completed, the results of the tax inspection bind the tax administration, without prejudice to the taxpayer's rights to claim (within the tax authorities and in Court) against such results.

For legal purposes, this tax inspection is deemed a service provided by the tax authorities to the taxpayer and, thus, a fee must be paid by the taxpayer. The amount of the fee must be notified to the taxpayer prior to the commencement of the tax inspection and must fall within prescribed levels published in a decree of the Ministry of Finance.

This Decree-law follows on from the recently enacted General Tax Code, which deals with the principles and rules applying to all Portuguese tax codes.

Miguel Teixeira de Abreu

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