On 20 September 2021 the Revenue Department published in the Royal Gazette the new regulations regarding appeals and consideration of appeals under the Revenue Code. the regulation operates retrospectively from 28 June 2021 and replaces all previous regulations on the matter.
Key Takeaways from the Regulations
There are some key updates that should be noted from the revised regulations including rules surrounding online filing, timing for appeals and extension requests and the Mutual Agreement Procedure.
Online Filing
Section 30 of the Revenue Code sets out that an appeal relating to an assessment of the tax and duty by the Revenue Department is required to be made by the applicant within 30 days from the date the notice of assessment was received by the taxpayer.
Under the current regulations, taxpayers are able to file an appeal online through the Department’s electronic appeal system as well as at the Revenue Regional Area office. In circumstances where filing an online application is not possible, taxpayers must file at the Revenue Regional Area office where their business is located within the prescribed time frame.
Where taxpayers wish to file an extension for the period for filing an appeal or the payment of tax and duty, they may do so through the online portal.
Timing for Appeals on Extension Requests
Where the taxpayer is late in filing and wishes to apply for an extension, they must submit their application along with an explanation as to why the filing was beyond the deadline in the first instance. If the Revenue officer objects to the extension, the taxpayer is entitled to appeal the objection within 15 days from the date the objection notice is received.
The Revenue Officer then has one year from the date the entire appeal application is received to fully consider the appeal. Where the taxpayer files the appeal after the 15-day deadline for filing, but there are reasonable grounds for the request, the appeal should be considered within one year from the date the Director-General approves the extension.
Where consideration cannot be completed in the one-year timeframe, and in circumstances there are reasonable grounds for an extension, an extension of not more than one year will be granted.
Mutual Agreement Procedure
The amended regulations also contain a provision pertaining to the appeal and receipt of appeal where the applicant has requested a dispute be resolved under the Mutual Agreement Procedure (MAP) provisions of a relevant double taxation agreement.
Essentially, MAP allows representatives from contracting states to resolve international tax disputes regarding double taxation, as well as any inconsistencies that arise in the interpretation or application of the relevant double taxation agreement. While the parties may attempt to resolve any differences arising out of a dispute, the designated representatives of the contracting states are not obliged to eliminate any double taxation that may have arisen.
Where the MAP is undertaken but the applicant does not agree with the result, or if the applicant agreed with the result but did not revoke their appeal within 30 days of the MAP result being decided, an authorized officer of the Revenue Department must consider the appeal within six months from the date they were given instructions to consider the appeal.
Note that going through MAP proceedings does not defer the payment of any tax and duty.