The following are some of the ground rules which I believe should be followed in dealing with government authorities:
1. Your relationship with a tax authority is very important and must be properly managed. You will be held accountable for the actions taken by your agents while acting on your behalf. You may even be held accountable for discreditable conduct which they have committed while not acting on your behalf.
2. Respect is critical to the government relationship. A professional must be prepared to aggressively and tirelessly advance his client's position in all circumstances. There can be no exception to this rule. However, in advancing the client's position the professional must always maintain dignity and respect, both of which are critical to the maintenance of credibility. This means that:
- You are respectful of officials as individuals, and of their opinions and point of view
- This includes in circumstances where you disagree with their opinion
- You seek out, where possible, win-win situations
- You do not escalate matters prematurely except where necessary
- You don't waste the time of government officials
3. Building and maintaining credibility is critical to managing the government relationship.
Persons dealing with tax authorities should be committed to the following:
- be honest and forthright in your dealings
- do not advance issues or appeals which are not meritorious
- do not engage in ‘sharp practices’ (i.e. jumping on mere oversights or other minor errors)
- do not bluff your position
4. Businesses seek to resolve disputes with tax authorities in a manner which is most favourable to the business. In striving for this outcome consider relationships and future dealings as well. Your conduct (and that of your agents) must be absolutely beyond reproach.
5. Relationships carry over to future events and to subsequent clients. The following should be considered in all dealings:
- Disagreements should not be treated as a personal affront
- Be careful of who you select to represent you - your advisor may have "burned bridges" in the past
- The auditor (or other official) may be waiting for an opportunity to "settle the score"
- The highest level of professionalism must be observed at all times
