Law 58/ 2003 passed on 17th December on The General Tax Law (hereinafter LGT) establishes what type of evidence is valid in tax proceedings. Article 105 of the LGT sets forth that those involved in a proceeding, in this particular case the tax administration or the taxpayer, shall prove the allegations made against the other party.
It should be noted that, since the tax proceeding is an inquisitorial procedure, the evidence can not have the same meaning as if it were a proceeding before an impartial judge; therefore, the Public Administration is obliged to find all the relevant facts, including those which might benefit the taxpayer. Hence, it is crucial that the taxpayer provides all the required data or information requested by the Public Administration.
Valid evidence
Contrary to what Law 30/1992 passed on 26th November on Legal Regime of Public Administrations and the Common Administrative Procedure establishes, in which any form or type of evidence is accepted by Law, the LGT sets forth what may or may not be valid as a means of evidence, according to the Civil Procedure Act or the Civil Code.
Invoices, records or assumptions are accepted as means of evidence or proof. As for the bills, article 106.3 of the LGT regulates the use of the aforementioned as a means of evidence to justify expenses.
What about the assumptions?
Assumptions imply proving a fact based on another fact that has already been proved. When it comes to tax issues, both legal and rebuttable presumptions are taken into account. Legalpresumptions are iuris tantum, meaning that the parties can provide evidence, unless expressly prohibited, while rebuttable presumptions require a link between what is presumed and what is proven.
An example of legal presumption would be the presumption of ownership of the assets, meaning that the Public Administration may consider the person who appears in the tax registry as the as the title holder or owner, unless proven otherwise.
Can proceedings be considered as a means of evidence?
The proceedings are public documents issued to certify facts or statements of the taxpayer. These documents have a probative value unless proven otherwise, as set forth in article 107 of the LGT. This probative value is carried out within an incriminating and inquisitorial procedure as it leaves the taxpayer completely helpless because what should be considered as a duty of cooperation ends up being evidence, especially when there is still no contradiction between the parties.