The Financial Administration of CR has issued information on how accounting entities as well as natural persons should proceed in case of destruction or damage to accounting records as a result of natural disaster specified in article 24 paragraph 10 of the Income Tax Act.

Taxpayers will announce this fact without undue delay to the respective local tax administrator together with the reasons why destruction or damage to accounting records could not be prevented. At the same time, they are obliged to perform arrangements to renew conclusiveness of accounting, individually in relation to the scope of damage, the volume of accounting records and their form, and last but not least to objective possibilities. The basis for renewing conclusiveness of accounting is, first of all, inventory-taking of assets and liabilities.

The tax administrator will verify the above-mentioned facts, preferably by inspection on location, and will write a protocol or official record.

The Financial Administration points out, however, that even a submitted announcement, if statutory conditions are met, does not exclude the option of using tools when determining tax liability. To what extent they are used, though, will mainly depend on the scope of inconclusive accounting records. In such situations, too, the burden of proof rests with the taxpayer.