Covid-19: beware of the suspension of limitation periods! – EconomyMorning


There are three periods of prescription in tax matters: the three-year prescription, the sexennial prescription and the ten-year prescription. As every year, December 31, 2020 should have marked the end of each of these prescriptions. But the health crisis is there. The limitation period is postponed to June 14, 2021.

In terms of income tax, corporation tax or VAT, the year 2017 is in principle prescribed on December 31, 2020 (three-year prescription). In terms of registration fees (IFI, gift or inheritance tax, sales tax) and in the absence of filing a declaration or filing an incomplete declaration, the limitation period is six years. The year 2014 should therefore have been prescribed on December 31, 2020. Finally, in application of the 10-year prescription, which applies in particular in the event of occult or illicit activity, the year 2010 should have been prescribed on December 31, 2020.

However, due to the health crisis, ordinance n ° 020-306 of March 25, 2020, modified by order n ° 2020-560 of May 13, 2020, provided for the suspension of deadlines not expired on March 12, 2020 or starting at run during the period between March 12, 2020 and August 23, 2020 inclusive.

The suspended limitation periods are applicable to tax audit procedures when the limitation period is acquired on December 31, 2020. This suspension applies not only to rectifications but also to late interest, surcharges and fines.

The deadline for resuming administration is therefore suspended for the period between March 12, 2020 and August 23, 2020 inclusive for the only year prescribed for December 31, 2020, regardless of the date on which control is initiated.

Example 1:

Date of end of suspension: August 23, 2020.

Duration of the legally neutralized period (between March 12, 2020 and August 23, 2020): 165 days.

To validly interrupt the limitation period for 2017, the proposed rectification must reach the taxpayer no later than June 14, 2021 (December 31, 2020 + 165 days).

Example 2:

A rectification proposal sent to the taxpayer on December 15, 2017 validly interrupted the three-year limitation period for 2014 and opened a new three-year period during which the administration can collect the additional taxes. This period, which normally expired on December 31, 2020, will expire on June 14, 2021 (2017 + 3 years + 165 days) given the suspension related to the state of health emergency.

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