Expiration, prescription, fixed base, permanent establishment, and ledgers
3. Permanent establishment and fixed base.
The prescription is a means of getting rid of assets or liabilities, by the course of some time, and under conditions established by law. The acquisition of property under possession, is called positive prescription, the release of obligations by not enforceable, called negative prescription.
On taxation there institution called prescription, just only in its negative form or liberatory, ie only exists as a way for the debtor to avoid obligations.
The art. 146 of the Federal Tax Code provides for the prescription, and this legal device can draw the following conclusions:
a) The existence of the limitation on tax matters with liberatory effects.
b) The term for which the institution operates is 5 years, subject to termination or suspension.
c) The term begins to run from the obligation becomes due.
d) The requirement is enforceable by way of action or by way of exception.
Other points are also important in this respect:
* Credit is legally required when not paid or guaranteed within the period prescribed by law.
* For that moment you can invoke the exception action or we can say that:
a) is valued as an action when the elapse of the period of limitation for credit, requested the tax authorities declaring that the credit requirements.
b) is valued as an exception, being notified when a loan is considered prescribed worth doing is contested among other concepts prescription nullity.
* The term is interrupted every collection management (ie any action by the authority in implementing administrative procedure, provided that the debtor made known), or notify the creditor notifies the debtor or by the express recognition or tacit (indirectly by any recognized the existence of the debt or tax credit), the prescription has the effect of lost time elapsed before the collection management or recognition of the debt, to start again the term of 5 years.
* The term stands suspended when a remedy and credit guarantees or overwhelms, suspending the administrative procedure of implementation and therefore unenforceable credit, the suspension has resulted in a failure or just not at the time for prescription while not definitively resolve the dispute through asserted.
The institution of revocation (Article 67 of the CFF) in federal tax corresponds neither agrees with the essential features of the expiration Precista figure elsewhere in the Mexican federal law, since in the latter case, the expiration is ina institution procedural, ie always occurs within the context of a process, while federal tax expiration has no such features.
Expires on Attorney:
* Institution of a procedural nature, character adjective, ie, is an institution that is closely linked to the exercise of the powers of the authorities.
* It is a figure that generates extinctive effects, ie by it disappear and such powers of certain authorities.
* Operates over time, so that effects egenre extinctive als powers regarding them is required not utilized within a certain period.
* The term required to operate is that the shelf life of 5 years and must in that case counted by calendar days. (Article 12 C.F.F.).
* The powers susceptible to extinction through expiration are only for verifying compliance with the tax provisions, the determination of unpaid taxes and penalties finally.
* It may assert elevating action via a request to the authorities in order that they issued a resolution declaring having operated in one case the powers extinction through expiration.
* It may assert as a defense, once the authority has exercised the power of inspection, determination or sanction, through the interposition of the defenses invoked the legality of the fought precisely because of being the realization of the exercise of powers when they were already extinct.
Article 67 of C.F.F. provides for the existence of the expiration attributing the following features:
a) Character procedimiental or adjective. – The shelf is an administrative institution for being vicnulada the exercise of such nature and governed by administrative law. The federal tax expiration has no procedural nature, does not imply the existence of a trial.
b) Character extinguishment. – The immediate effect generated by the expiration in federal tax is that it disappear under certain powers of the authorities for not having been exercised within the period provided by law.
c) Powers susceptible species. – The art. 67 of the Federal Tax Code states that only extinguished by the lapse “the powers of the tax authorities to determine the omitted contributions and accessories, as well as to impose sanctions”
d) Activities at the expiration The powers referred to in the preceding paragraph through expiration are likely to die when they are exercised outside the period of 5 years referred to in Article. It follows that the expiration extinctive effects generated through the course of time.
e) Period of revocation. – are 3 deadlines for expiration update namely three years, five years and ten years, each corresponding to different assumptions.
f) The period of revocation. – The art. 67 of the Federal Tax Code establishes different deadlines:
Generic term: In five years, which can be said to be the general rule, since become extinct within the aforesaid powers in most cases.
Specific time: 1> In ten years when the taxpayer has not submitted an application in the Federal Tax accounting or not carry, also for the years to present not exercise any statement being forced to submit.
2> Three years in the case of liability of liquidators and trustees.
The Expiration is extinction, merely over time, the power of the tax authorities to check the violation of tax provisions, determine the omitted contributions and accessories, as well as to impose sanctions for violations of those provisions.
The shelf is suspended when an administrative appeal is brought or judgment, to the effect that not count the time elapsed during the pendency of the challenge brought through. The period of revocation when Filing starts from the day following that on which the supplementary declaration is submitted.
The expiration term when it comes to contributions which are not designed for exercise starts from the day following the date of submission or should have made the declaration.
The period of revocation begins to impose sanctions on the day following that on which the offense was committed to fiscal provisions, but if the offense is of a continuing or repeated, the term shall run from the day following that consummation has ceased or has taken place, the last behavior or event, respectively.
EXPIRY OF THE TREASURY AUTHORITY TO DETREMINAR CRDITOS.-CASES WHERE THE NOTICE IS MADE IN THE LAST DAY OF TERM OF 5 YEARS. – Article 103 of the CFF states that notifications produce their effects on the business day following that on which they were made. This rule applies to all kinds of notifications made in the administrative proceedings and subject to the same article, the notification comes to life when you have had legal effects, therefore, in the case of notification of a claim is made on the last day a period of five years of enjoying the authority to exercise its powers, came to be considered as the expiration of the same, given that according to the precept quoted, is consummated within expiration.
Jurisprudence thesis sustained by the Superior Court of the Federal Tax Court pursuant to the provisions of art. 231 fr. C.F.F. III 939/77/3914/77 revisions to resolve the 13 September. 223/78/7732/77 1978 and 8852/77 on September 27. 136/743611/73 1978 and the February 9. , 1979. – Pg.24.-Magazine Tribuanl Federal Tax. Jurisprudence 1978-1933.
The expiry extinguishes what are the powers of the tax authorities to check compliance with the tax provisions, determine the omitted contributions and accessories, as well as to impose sanctions for violations of those provisions.
* Differences between limitation and prescription under the Tax Code.
3. Permanent establishment and fixed base.
Permanent Establishment. – Mentioned this in the Income Tax Law, refers to the source of wealth (income) in the country to obtain the subject MEXICO corporation or individual who makes commercial-entrepreneurial activities, which will be taxed according to the LISR Only when in the legal theory that determines the relevant tax law, concluding that the MITL taxed only the permanent establishment or fixed base in the country is Mexico, understanding it as determined by Article 42 of the Constitution of the United Mexican States.
Fixed Base. – On this concept handled in the Income Tax Law refers only to the source of wealth (income) for natural person not engaged in business activities, but rather independent personal services, and is this your source wealth within the country Mexico, as provided in Article 42 of the Constitution of the United Mexican States.
With regard to Article 1, Section I of the Income Tax Law expression “.. whatever the location of the source of wealth in which they arise ..” does refer to any part of the world.
With regard to article 1, section III of the Act in question, an example of the first situation raises the fraction above “… they do not have a permanent establishment or fixed base in the country ..” would be that of a resident alien Foreign tax, which is a property located in the country (Mexico), and leases it to a national or foreign, is not the first, because if it does not have a permanent establishment, and is not in the course Fixed Base, if you are having a source of wealth in the country Mexico;
Now as to the second assumption in the same fraction “… or when having it, such income is not attributable to them” the same example can be used only whereas the foreign resident does have a permanent establishment or fixed base and other income the property mentioned.
Book. – Set of sheets of paper, usually printed pages bound. In Accounting are called so, even if they have not been used yet its leaves any impression or have not been bound.
Sheets. – Accounting system that is processed on machines contabilizadoras and that therefore can not have more books-and-bound diary from the beginning. In such cases the numbered sheets are carried to the authorities allow collecting and bound until they are used in registers. The ledger in these cases is integrated card instead of sheets.
Ledger. – That which is intended to record the operations of a company.
Top Books. – Those who should be mandated by law. In Mexico are the journal, the general ledger and the book of inventories and balances. In some special cases, the book sales.
Daybook. – One in which operations must register a company in the order they occur. Such records require the use of accounting principles and procedures such as double entry, few seats, etc..
Ledger. – One in which record company operations classified according to that affect. This sheet is intended, for example banks and there are recorded only operations affecting that as much.
Ledgers. – Those who optionally, leading companies to record in detail the operations that have been registered in the main books.
Book of Revenues and Expenditures. – One who is used to the simplified registration, does not require the use of double-operations of a company. Fiscally responsible can only take those expressly authorized by the respective law. The name of this book is eminently source tax accounting as an entry can not be identified with an income of money, no money out of a discharge and sometimes it happens to be recorded are the inputs and the outputs when the book is not consigned these titles.
Inventory and Balances Book. – One in which you must enroll each year the balance sheet, the income statement, inventories of goods and materials that closes an exercise.
* Federal Tax Code.
* Law of Income Tax.
* Jimenez Gonzalez, A. Lessons of Tax Law.
ECASA Ed. 3a.ed. Pp. 229-245, 403-411.
* BOETA Vega, A. Tax Law. Ed ECASA 1a.ed.
Pp. 110-112, 133-137.
* FRANCO Diaz, Eduardo M. Dictionary of Accounting. New Century Publishers, Inc. 4th ed. Mexico, 1983.