Business owners are legally obliged to keep proper records. The law does not specify exactly what these records should include. The penalty for failing to comply with the record-keeping obligation is that the burden of proof is reversed. This means that it is not the Tax and Customs Administration that must prove that the tax returns are incorrect, but rather that the taxpayer or withholding agent bears the (very heavy) burden of proving that they are correct. Given this severe penalty, it goes without saying that not every shortcoming in the fulfilment of the record-keeping obligation immediately leads to a reversal of the burden of proof.
On 26 June 2015, the Supreme Court ruled in the case of a Chinese-Indian restaurant that the detailed records entered into the restaurant’s computerised ordering and till system were among the records required to be retained. This data made it possible to verify the cash turnover against the flow of goods (the link between purchases and sales). Consequently, this data was relevant for tax purposes. Only if this link can also be established by other means is it not necessary to retain the detailed data in the computerised system.
The business owner claimed that, due to force majeure, he no longer had access to the data. This was because the computerised system did not have sufficient storage capacity to retain the detailed data. However, the Supreme Court does not regard this as a case of force majeure.
However, the Supreme Court ruled that the reversal of the burden of proof does not apply to a type of tax for which the missing data is not relevant. In this case, therefore, the failure to retain the detailed data had no consequences in relation to payroll taxes.