What exactly does tax risk mean? What are the tax risks?

In practice, if many tax risks are involved, what exactly does tax risk mean and what does tax risk include? After reading the following content, it will definitely help you.

1. What exactly does tax risk mean?

Tax risk refers to the possibility that an enterprise's tax-related behavior will suffer legal sanctions, financial losses or reputation damage due to its failure to correctly and effectively abide by the provisions of the tax law. And tax risk management is the management countermeasures and measures to prevent and avoid tax evasion by enterprises. Tax risks can be classified according to different standards.

1. Tax risks from different sources

According to the source, tax risks can be divided into two categories:

First, the risk of tax underpayment and late payment from law enforcement departments such as the tax bureau;

One is the risk of overpaying taxes and paying taxes in advance.

When it comes to tax risks, many taxpayers will think of the risks brought by being inspected and paid by the tax bureau. This is a common tax risk, which is caused by the tax bureau's underpayment or late payment of taxes. Correspondingly, it is the risk of overpaying and paying taxes in advance from oneself, and it is also a risk that should be prevented and controlled.

Only by understanding the risks from the above two angles can we fully understand the tax risks and build a tax risk prevention and control system with complete contents and systems.

2. Tax risks of different contents

According to the content of tax risk, tax risk can be divided into:

Risks of specific taxes, such as value-added tax risk and enterprise income tax risk;

Risks in daily management, such as the risk of violating tax declaration, tax registration and invoice management.

3. Different tax risks.

According to the nature and severity of tax-related behaviors, tax risks can be divided into:

Risks of tax evasion and other tax violations;

Risks that do not violate laws and regulations, such as overpaying taxes.

Generally speaking, the risk nature of tax evasion and other tax violations is worse, and the consequences are more serious. Compared with the general tax compliance risk, we should attach great importance to it.

2. What are the tax risks?

The tax risks of enterprises mainly include two aspects: on the one hand, the tax payment behavior of enterprises does not conform to the provisions of tax laws and regulations, and they should pay taxes without paying taxes or paying less taxes, thus facing risks such as overdue taxes, fines, late fees, fines and reputation damage; On the other hand, the application of tax law to the business activities of enterprises is inaccurate, the relevant preferential policies are not fully utilized, taxes are overpaid, and unnecessary tax burdens are borne.

Third, identify tax risks.

Enterprises should regularly, comprehensively, systematically and continuously collect relevant internal and external information, find tax risks in their business activities and business processes through risk identification, risk analysis, risk assessment and other steps, analyze and describe the possibility and conditions of risks, evaluate the impact of risks on enterprises' tax management objectives, and thus determine the priority and strategy of risk management.

Generally speaking, enterprises should focus on identifying the following tax risk factors in combination with their own tax risk management mechanism and actual operation:

1, corporate governance levels such as the board of directors and the board of supervisors, and the management's awareness of tax compliance and attitude towards tax risks;

2. Professional ethics and professional ability of tax-related business personnel;

3, enterprise organization, operation mode and business process;

4. Technology investment in tax administration and information technology application;

5. The financial status, operating results and cash flow of the enterprise;

6. The participation and implementation of the relevant internal control system of the enterprise;

7. The economic situation, industrial policies, market competition and industry practices faced by enterprises;

8. Compliance of enterprises with laws, regulations and regulatory requirements;

9. Other relevant risk factors.

The tax risk identification and assessment shall be carried out by the tax department of the enterprise in cooperation with relevant functional departments, or an intermediary agency with relevant qualifications and professional ability may be hired to assist in the implementation, so as to implement dynamic management of tax risks and timely identify and assess the changes of original risks and new tax risks.