Facts
The taxpayer, a public limited company with its statutory seat in Bern, failed to submit its tax return for the 2018 tax period despite a reminder from the assessment authority of the Canton of Bern (KSTV/BE). This resulted in two assessment orders dated 17 March 2020, which were duly served on the taxpayer. The taxpayer forwarded the orders to its fiduciary agent, but did not lodge an objection within the 30-day objection period.
It was not until 5 May 2020 that the taxpayer, through its fiduciary agent, submitted a request for restoration of the objection period and simultaneously submitted a completed tax return, which was deemed to constitute an objection by analogy. The assessment authority did not entertain the objection, whereupon the taxpayer filed an appeal and recourse with the Tax Appeals Commission of the Canton of Bern. Both legal remedies were dismissed by decisions dated 22 October 2020.
The taxpayer then lodged an appeal with the Administrative Court of the Canton of Bern, which dismissed the appeals by decision dated 3 December 2021. The Administrative Court held that the contractual relationship between the taxpayer and the fiduciary agent was only evidenced as of 5 May 2020 and that the taxpayer had not clearly expressed its intention to engage the fiduciary agent until that date. Moreover, the taxpayer had not been prevented from ensuring timely submission of the objection itself or from instructing the fiduciary agent about the status of the work. The fiduciary agent, for its part, was at fault for organisational and takeover negligence, as it had not adequately informed the taxpayer or declined the mandate. A document issued by Bern Inselspital did not prove either complete incapacity for work of the fiduciary agent in charge or his inability to act in a timely manner or to appoint a representative. Nor did the document indicate that he belonged to a Covid-19 risk group. Electronic means of communication could have been used to obtain the necessary instructions.
Against this decision, the taxpayer lodged an appeal with the Federal Supreme Court in public law matters and requested that the contested decision be set aside and that its request for reinstatement in the previous status be granted. The Tax Appeals Commission was to be instructed to annul the official assessment as of the 2018 tax period and to refer the matter back to the assessment authority for a new assessment.
Considerations
The Federal Supreme Court first examines the admissibility of the appeal. It finds that the requirements for an appeal in public law matters pursuant to Art. 82 lit. a, Art. 83 e contrario, Art. 86 para. 1 lit. d and para. 2, Art. 89 para. 1, Art. 90 and Art. 100 para. 1 FSCA in conjunction with Art. 146 DFTA and Art. 73 DTHA are met insofar as the taxpayer requests restoration of the missed objection period. However, the further prayer for relief, which seeks a new official assessment, is inadmissible as it constitutes an impermissible extension of the subject matter of the dispute (Art. 99 para. 2 FSCA).
On the merits, the Federal Supreme Court examines whether the lower court was correct in finding that the conditions for reinstatement in the previous status were not met. In doing so, it relies on the provisions of Art. 133 para. 3 DFTA and Art. 161 para. 3 STC/BE, which are largely identical in content. Under these provisions, a late procedural step is only to be considered if the taxpayer proves that it or its representative was prevented from taking timely action without fault (material requirement) and that the legal remedy was filed within 30 days after the removal of the impediments (formal requirement). Impediments include, in particular, military or civil service, illness, absence from the country or other substantial reasons, but not excessive workload, organisational deficiencies or absence due to holidays.
The Federal Supreme Court confirms the lower court’s assessment that the Covid-19 pandemic as such does not constitute grounds for excusing the missed deadline. The taxpayer has…