Tax proceedings can cover a wide variety of issues, including a disagreement with the tax authorities regarding the qualification of a certain item for tax purposes or its correct disclosure in a tax return, a tax assessment you disagree with or tax assessments that include penalties. In general, such issues lead to objection proceedings and possibly appeal proceedings (Sections 7:1 and 8:1, General Administrative Law Act).
The first contact with the tax authorities regarding an issue in fact marks the start of proceedings. The course of those proceedings will differ on a case by case basis. Potentially, you may be facing negotiations, an information decision (Section 52a, General State Taxes Act (AWR)), inspection of the file (Sections 7:4 and 8:29, General Administrative Law Act (Awb)), the allocation of the burden of proof, but also the reversal and increase of the burden of proof (Sections 27e and 52a, General State Taxes Act), hearings of witnesses (Section 8:60, General Administrative Law Act), time limits (Section 6:7 in conjunction with Section 6:8, General Administrative Law Act, and Section 26c, General State Taxes Act) or the position to be taken.
Litigation is like a game of chess. We have the requisite knowledge and experience to appraise your risks and likelihood of success, and to determine the strategy in tandem with you, aiming to represent your interests in the best possible way during the proceedings. Where needed, we’ll take litigation to the cutting edge, whether it be in writing or in court.
However, in our view, a – threatening – conflict situation does not have to end in litigation. Litigation is not a goal in itself. We never cease to focus on your interests and the best possible result for you, which may well be a solution reached out of court, for instance in the form of a settlement or tax ruling. In other words, the attorneys of Hertoghs are also excellent negotiators, with the requisite experience gained with the settlement of disputes on the basis of tax mediation.
Tax mediation is an alternative and broader form of dispute resolution. Not only does it devote attention to the dispute itself, but also to how the dispute and the ensuing communication (or miscommunication) and emotions arose. This is effective not only to reach a solution for your dispute, but it’ll also be of benefit to your future relationship with the tax authorities.
Mediation is a suitable method only if the dispute involves more than purely a question of law. It’s commonly used to break a deadlock, such as when communications or negotiations have come to a halt and legal proceedings are not in your best interest. Principal questions and purely legal issues, as well as criminal-law issues, are not suitable to be resolved by mediation.
Mediation can be used at different stages of dispute proceedings. When proceedings have not yet been filed, the tax authorities will set up the mediation, on the condition that both parties are willing to cooperate. But even if proceedings have already been filed, mediation can still take place on the basis of reference by the judge. Our attorneys will be happy to assist you in this respect as party counsellor.
In a nutshell
Litigation no goal in itself
Possible at different stages
Alternative form of dispute resolution