Should accounting records be kept for five or ten years? What if they contain documents in English?
DHL Express Mexico complained that the Mexican tax agency assessed omitted taxes when its power had already expired.
The Federal Tax Code provides that powers expire after five years and that they are counted, in the case of taxes that are not calculated by fiscal years, from the date the tax return was filed or should have been filed.
However, the period will be ten years when the taxpayer has not filed a return when subject to do so.
This case refers to radio spectrum fees. The agency argues that, since DHL has not filed its return, the ten-year period applies.
However, the court points out that this is not a tax that is calculated by fiscal years, but the law rather provides a fee for a specific period of one year based on the use of the spectrum.
Therefore, even though the fiscal year matches the calendar year, this does not imply that the tax is calculated by fiscal years.
Therefore, the five-year period counted from the date the tax return should have been filed is applicable.
In this case, the authority determined that DHL did not pay the fees, and, since it did not file the return, it shall consider the date on which it should have been filed.
Since the five-year period had elapsed, the court granted the amparo petition to DHL and annulled the tax liability.
In this regard, in order to determine whether the accounting records must be kept for a period of five or ten years, we must consider the traits of each different tax.
Accounting documentation in English must be translated into Spanish when the authorities exercise their audit powers, when refunds are requested, and when tax setoff notices are filed.