What to prepare before a tax examination

The basic idea

A strong tax file is not built two weeks before an examination — it is built through the year. But if an examination is coming, organising what you have now genuinely reduces both the scope and the length of the discussion.

1. Books and statements

Trial balances and financial statements for the periods under examination, agreeing to what was filed. Any difference between the books and the return should have a documented explanation ready in advance.

2. Supporting documents

Sales and purchase invoices, contracts, bank statements, expense documentation. Chronological order and clear classification save significant time and reduce the risk of a lost supporting document.

3. Reconciliations prepared in advance

Declared revenue to the books, purchases and expenses, and bank balances. Presenting a prepared reconciliation is far better than building one under pressure.

4. Explanations for unusual items

Any exceptional item — a large adjustment, a non-recurring expense, a particular treatment — should have written support and a clear explanation.

5. One voice for the company

Multiple speakers produce contradictory answers. Designate one person or party responsible for communication, and log every document provided.

Note

This article is general. Requirements differ by activity, period and file, and this content is not a substitute for a review of your specific situation.