Types of Tax Audits: Documentary, Field, and Desk Audits

Tax audits are one of the main tools used by the government to monitor the correct and timely payment of taxes. For businesses, it is important to understand the different types of audits, how they are conducted, and what rights and obligations taxpayers have during the process.

Main Types of Tax Audits

Under Ukrainian legislation, tax audits are divided into three main categories: documentary audits, field audits, and desk audits. Each type has its own specific features.

1. Documentary Audit

A documentary audit is conducted to verify the correctness of tax calculation and payment based on the documents submitted by the taxpayer. It may be scheduled or unscheduled.

• Scheduled audit — carried out according to the annual audit plan approved by the tax authorities.
• Unscheduled audit — conducted in cases of detected violations, citizen complaints, court decisions, or other legally established grounds.

A documentary audit is conducted at the tax authority’s office and does not involve visiting the taxpayer’s premises.

2. Field Audit

A field audit involves tax inspectors visiting the taxpayer’s place of business or another inspection site.

The purpose is to verify the actual state of affairs, the availability of material assets, accounting practices, and compliance with tax legislation on-site.

Field audits are usually initiated when there is suspicion of violations or after a documentary audit.

3. Desk Audit

A desk audit is the examination of tax returns and reports submitted by the taxpayer to the controlling authority.

It is conducted without visiting the taxpayer and is based solely on the analysis of submitted documents.

The purpose is to identify formal errors, inconsistencies, and verify the accuracy of calculations.

Desk audits are the most common type of tax audit and are carried out for almost all taxpayers.

Rights and Obligations of Taxpayers During Audits

During any type of tax audit, taxpayers have the right to:

• review the notice or order authorizing the audit;
• participate in the audit and provide explanations and documents;
• receive copies of audit reports;
• appeal decisions of tax authorities in accordance with the law.

Taxpayers are obligated to:

• provide accurate information and documents;
• cooperate with tax inspectors during the audit process.

How the Ukrainian Bar and Real Estate Association Helps With Tax Audits

• providing consultations on audit preparation;
• analyzing tax documentation and identifying risks;
• supporting clients during audits and protecting taxpayer interests;
• appealing unlawful decisions of tax authorities.

Understanding the different types of tax audits and preparing properly for them helps businesses minimize risks, avoid penalties, and prevent misunderstandings with tax authorities. Do not postpone solving tax issues until the last moment — seek professional legal support to protect your rights and interests.