An issue of great relevance in tax matters is that of EFOS (companies that invoice simulated operations) and EDOS (companies that deduct simulated operations), since in recent years the Federal Government has declared war against the so-called “factureras” (companies that invoice simulated operations).
For all taxpayers, it is undoubtedly a great concern that some of their suppliers, creditors and even customers are published in the list of taxpayers that carry out non-existent operations under the assumption of article 69 B of the Federal Fiscal Code due to the tax effects that this could entail.
Therefore, taxpayers must implement several measures to monitor the tax behavior of their suppliers and creditors, among which the following stand out: request from suppliers and service providers their compliance opinions and constantly review the list published by the Tax Administration Service through its website where the list of taxpayers published under the provision of article 69 B of the Federal Tax Code is disclosed to corroborate that they are not published as definitive EFOS, since this would imply tax repercussions.
The fact that the Authority reports a taxpayer as a definitive EFO is because it considers that it has been issuing receipts without having the assets, personnel, infrastructure or material capacity, directly or indirectly, to provide the services, produce, commercialize or deliver the goods covered by the CFDIS it issues, or that such taxpayer is not located, for which reason the Authority will presume the non-existence of the operations covered by the CFDIS issued by such taxpayer.
This is derived from the assumption that when an EFO, being an individual or legal entity, issues invoices for simulated transactions to an EDO, the EDO deducts such simulated transactions and thereby unduly reduces its taxable income tax base and credits a simulated Value Added Tax.
Therefore, since it is considered that the taxpayer issued CFDIS for non-existent transactions, the transactions contained in the tax receipts issued by the taxpayer in question do not produce and did not produce any tax effect, by virtue of the foregoing, if any supplier or creditor is involved in the aforementioned situation, the tax effect that we have given to the tax receipts issued by such taxpayer will be null and void.
In the case of Income Tax (ISR), the expense incurred would not be deductible and the corresponding complementary declarations of provisional payments and the corresponding annual declaration(s) would have to be filed.
In the case of Value Added Tax (VAT), the corresponding tax could not be credited, therefore, the corresponding definitive complementary VAT returns and informative returns would have to be filed.
Likewise, in the particular case of individuals providing services in the event of having a client listed as a definitive EFO, there may be tax repercussions, since it is common to find that such clients have not complied with their tax obligations in terms of reporting the deductions made.
It is extremely important that if a supplier, creditor or client is found under the assumption of definitive EFO, the operations related to such taxpayer are reviewed in detail and to evaluate if the commercial relationship could be solved and demonstrate that it is not a simulated operation or in case of not having all the elements that cover such operations, the CFDIS received are left without fiscal effects, In accordance with the Federal Tax Code, the taxpayer has the obligation to correct the tax situation or demonstrate to the Authority that the goods or services covered by the CFDIS issued by said taxpayer were actually acquired or received, in accordance with the terms of the aforementioned Law.
If this is not done, we could be subject to a review by the Tax Authority, which will determine the corresponding tax credit derived from the fact that the operations covered by the aforementioned tax receipts will be considered as simulated acts or contracts for the purpose of crimes specified in the aforementioned Code, with their respective legal consequences.
Therefore, if you have any doubts or suspicions about the status of your suppliers, creditors or customers, as well as whether the transactions entered into with them comply with all the requirements and have all the elements to not be considered as simulated operations, do not hesitate to contact us to propose strategies that can solve this situation and protect your assets before a request from the authority.
At Stratego, we stand out for our extensive experience in providing comprehensive advisory services to companies on tax matters, encompassing both accounting and legal aspects. Our team of specialists conducts a comprehensive analysis of cases, offering broad and multidisciplinary solutions, always in defense of our clients. If you have questions or are looking for detailed information about our services, we encourage you to contact us.
This document does not constitute a particular consultation, and therefore, Asesores Stratego SC, is not responsible for the interpretation
or application given to it. The total or partial reproduction of this publication, by any means or procedure, is prohibited without the prior, express and written authorization of the author. Any form of unauthorized use will be prosecuted in accordance with the provisions of the Federal Copyright Law. We are at your service to answer your questions or comments, for more information on this subject and our services, please contact us at: info@asesores-stratego.com