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Belgium extends rights of tax authorities

Circular Ci. RH.81.616.308 (AAFisc No. 10/2012) of 3 March 2012 on the income tax consequences of the abolition of the bank secrecy is published

Until 1 July 2011, the tax administration could not collect information of taxpayers from accounts, books and documents kept by financial institutions. This was not the case when, during an audit of a financial institution, concrete indications (aanwijzingen) were found that a taxpayer was committing, or preparing to commit, tax fraud.

Furthermore, the tax administration took the view that, during an audit of a taxpayer, it was not possible to request information from a financial institution as a third person.

Article 333(1) of the Income Tax Code provides that, as from 1 July 2011, a taxpayer must be notified about indications that he has committed tax fraud.

From 1 December 2011, a taxpayer must be notified if the tax administration intends to issue an assessment on the basis of indications that he has committed tax fraud.

This obligation also applies if the investigation concerns previous tax years.

A taxpayer, however, does not have to be notified if a request for exchange of information is received from a foreign country.

Since 1 July 2011, the tax administration may request information concerning a taxpayer from a financial institution as a third person.

This means that the tax authorities are no longer limited to obtaining information concerning taxpayers during an audit of the financial institution.

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