Which documents for tax returns are required by AADE and the... fines

The Independent Authority for Public Revenue (AADE) requests taxpayers to submit supporting documents for specific codes of their tax returns. These must be submitted or sent within 15 days.

Those who ignore the relevant notice risk being charged with additional taxes as well as an independent fine ranging from €100 to €500.

When filing tax returns, supporting documents are not submitted. However, the tax office requests them in certain cases, mainly to verify the information declared in the codes of forms E1, E2, E3, whenever, after checks, doubts arise regarding their accuracy or when the declaration management system itself triggers a “red flag” through automated cross-checks.

The tax assessment is carried out automatically upon submission of the tax return, but subsequent checks are performed to confirm the accuracy of the declared data.

For cases in which the Tax Authority has doubts about certain codes, after electronic submission, the system displays a message requesting the submission of supporting documents to the competent Tax Office (DOY) or to KEFODE.

In addition, during the submission of initial returns through the digital portal myAADE, in cases where there is no electronic information on certain income and taxes, the return may not be assessed immediately. Taxpayers may then be asked to attach the relevant supporting documents within the submission platform itself, or to submit or send them to the competent DOY through the “My Requests” platform, also within fifteen (15) days.

When supporting documents are requested

AADE mainly requests supporting documents when:

• A large tax refund arises.
• No electronic information exists for certain income or taxes.
• Expenses are declared that either reduce taxable income or lower the tax due.
• Codes prefilled by AADE (based on information from third parties such as banks, employers, insurance funds, schools, foreign institutions, etc.) are corrected.
• Amended returns are filed which result in a reduction of the initially assessed tax.
• It is deemed necessary by the Head of the DOY.
• The declaration is considered suspicious and is checked as part of the random audits carried out each year by AADE, after the tax return process is completed, or even within the framework of a regular tax audit.

The deadline

When it is deemed necessary to check supporting documents of initial or amended returns submitted through the myAADE digital portal, taxpayers are notified via message to attach them within the submission platform, or to submit/send them to the competent DOY through the “My Requests” platform or by other prescribed means.

The deadline for submitting the supporting documents is 15 days from the date of notification.

After this deadline, the returns are assessed by the DOYs, deleting or correcting, where necessary, any amounts that involve tax exemption, deduction, or reduction of declared income or tax, which are neither covered by electronic records nor substantiated by appropriate supporting documents in physical form. Subsequently, tax assessment acts are issued.

In practice, this means that if the taxpayer fills in a code that ensures a tax reduction, but does not submit the relevant supporting documents within 15 days, the tax office assesses the return without taking that reduction into account.

The Administrative Tax Assessment Acts, in such cases, are issued by the DOY that processes the return and are communicated to the taxpayers.

…and the fine

Apart from the additional income tax that may be charged if supporting documents are not submitted, taxpayers who ignore the AADE notice will also be penalized with a fine.

Specifically, failure to respond to the AADE’s request for supporting documents entails the imposition of an administrative fine as follows:

• €100 for each violation, if the taxpayer is not required to keep accounting records (books).
• €250, if the taxpayer is required to keep simplified accounting records.
• €500, if the taxpayer is required to keep double-entry accounting records and documentation.