TAX. Invitation Letters (Cartas Invitación) issued by the Tax Administration Service actions October 21, 2020
The Invitation Letters (Cartas Invitación) are a very frequent practice of the tax authorities through which they “invite” or “exhort” the taxpayers to regularize, amend and/or clarify their tax situation for a possible breach of their tax obligations detected as a result of the review they carry out in its institutional databases. The Invitation Letters do not constitute a power of verification, but that does not mean that they are exempt from complying with certain legal requirements in order to be duly founded and motivated under the legal basis.
However, since the past few months of the present year, several officials and administrative departments of the Tax Administration Service (SAT) have been issuing and sending to the taxpayers a considerable amount of Invitation Letters that lack legal requirements and formalities they are bounded to. For instance, (i) they have been sent from officials’ emails; (ii) they are groundless on regards to the legal basis; (iii) they are issued on the day following to the expiration term to comply with tax obligations; (iv) they request the payment of tax assessments on regards of a simple revision of the institutional databases; (v) they refer to obligations that the taxpayers have already fulfilled and observed; (vi) they are issued by administrative departments that jurisdiction are beyond of the taxpayers´ tax domicile; (vii) they are issued by functionaries that are not entitled with powers under the SAT´s regulation; or, (viii) they are reproduced in non-official documents or non-official formats.
The SAT has stated as a premise to consolidate itself as a Tax Administration that facilitates and encourages taxpayers into a voluntary-observance culture to comply with their tax obligations, for which recently issued a series of considerations and instructions establishing the characteristics through which its officials and administrative departments may issue Invitation Letters requiring taxpayers to regularize, amend and/or clarify their tax situation.
However, we consider that the raison d‘être and nature of the Invitation Letters has been deteriorated through time since such practices denote a clear purpose of coercing taxpayers for merely collection purposes.
Also, it should be noted that the legal powers of verification the SAT is entitled to in order to determine a tax assessment generally are the tax audits, the information and documentation requirements and electronic tax audits.
In the event of receiving an Invitation Letter with the characteristics indicated, even that apparently complies with the considerations and instructions released by the SAT, it will be essential to review and analyze such letter, ruling or document in order to establish the actions necessary required to properly address it.
If you have any questions regarding the foregoing, please do not hesitate to contact us.
Mexico City, October 21, 2020