The La Defense business district in Paris, France, on Wednesday, Jan. 22, 2020. Thierry Viu of CMS discusses the powers of the French tax authorities to enter and search a company’s premises to seize evidence of tax fraud, and the process that follows such a search, leading to a tax audit. Tax searches are a powerful way for the French tax authorities to gather evidence, as they allow them to seize all documents on a company’s premises that may reveal tax fraud. The searches may affect all companies, whether small or multinational. According to a public report released by the French Ministry of Finance, more than 160 tax searches on company premises were carried out in France in 2021. The amount of tax adjustments made by the authorities following these searches was more than 562 million euros ($609 million)—417 million euros in principal and 155 million euros in tax penalties. Since taxpayers are not informed in advance of a tax search, several questions arise: Why do the tax authorities carry out a search? Who can be the subject of a search? What documents can be seized and how can they be used? What tax penalties are likely to be […]
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