By Cesar Antonio Ponce de la Torre
The tax authorities use the Administrative Enforcement Procedure to enforce the payment of outstanding tax credits. This procedure is initiated when the taxpayer incurs in the omission of a tax obligation, and the corresponding credit has not been settled or guaranteed within the established terms.
In order for a tax authority to initiate an Administrative Proceeding, it is required:
- Omission of payment: The taxpayer must have failed to comply with a tax obligation that has not been settled.
- Notification: The tax credit must have been duly notified to the taxpayer.
- Enforceability: The claim must be enforceable, i.e., the legal term for payment must have expired.
The Administrative Enforcement Procedure contemplates several stages, beginning with the Enforcement Order, in which the tax authorities notify the taxpayer of the outstanding tax credit. Next, the Payment Demand is issued, in case the taxpayer does not make the payment, the seizure of assets will proceed. Subsequently, an appraisal of the seized assets is performed. After this, the auction is called. In the auction phase, the goods are sold at public auction, and finally, the goods are awarded to the highest bidder, all this procedure with the purpose of covering the tax credit that has not been liquidated.
The procedure ends if the taxpayer pays the credit before reaching the auction stage.
These acts within the Administrative Enforcement Procedure may be challenged by means of an appeal for revocation before the same tax authority or in a nullity proceeding before the competent Court of Administrative Justice, which may only be filed up to the time of publication of the auction notice, and within ten days following the date of publication of the aforementioned notice.
At Vega, Guerrero y Asociados, we have solid experience in the legal defense against any act related to the Administrative Enforcement Procedure. Our team of experts is prepared to advise you and protect the interests of your company, avoiding possible seizures and guaranteeing compliance with your tax obligations. Contact us.
