Civil legislation[1], taking into account the explanations of the Supreme Arbitration Court[2], provides for the possibility of recovery from a dishonest leader of losses incurred by a legal entity as a result of bringing to responsibility for a tax offense.

This article discusses the prospects for the recovery of additional tax assessments based on the results of the analysis of the current jurisprudence on this category of disputes performed by the Tax Compliance specialists.

It follows from the law that both the Company itself (represented by its representatives) and the founders (participants) in its interests[3] may make such a request to the director. 

The necessary conditions for the onset of liability in the form of compensation to a legal entity for the losses incurred by its director (including former directors) are[4]:

• The occurrence of negative consequences for the legal entity in the form of losses incurred.
  
• The amount of losses.
• The fact of unlawful conduct of the director.
• Bad faith or unreasonableness of his actions.
• Existence of a causal link between the unlawful conduct of the director and losses of the legal entity.
• Guilt of the director in causing losses to the legal entity.

Courts emphasize that the subject of liability in the form of damages is compensation for specific damages caused by unlawful acts[5]. 

Thus, applying for the recovery of tax losses, the plaintiff, among other things, must prove the key circumstances - the existence of losses and their size. For this purpose, as a rule, materials of tax control measures are used.

From the analysis of judicial practice, it follows that the information letter of the tax authority[6] and the minutes of the commission meeting on the financial and economic activities[7] are not appropriate evidence, because by themselves do not entail the emergence of tax and legal consequences for the organization of the taxpayer.

Therefore, as evidence confirming the size and the fact of incurring losses, should use the decision of the tax authority, which has entered into force, adopted on the results of the control measures.

Courts proceed from the fact that it is the decision on the tax audit that has entered into force that determines the obligation to pay taxes, penalties and sanctions to the budget, and therefore forms all elements of the disputed legal relationship on the recovery of losses[8]. 

At the same time, judicial practice develops in such a way that not the entire amount of additional tax charges is recognized as losses of the company and is subject to recovery from the head.

Regarding underpayments (taxes)

As a rule, the courts refuse to recover the amount of additional taxes, guided by the legal position set out in the rulings of the Supreme Court[9]. 

Thus, according to the provisions of Article 11 of the Tax Code of the Russian Federation, the amount of tax or fee not paid in the period prescribed by the legislation on taxes and fees is underpaid.

Based on the meaning of this concept, as a general rule, additional accrual by the results of a tax audit of tax not paid by the company on time, does not entail losses for the company, because legally accrued taxes are in any case subject to payment.

Arrears in its legal nature does not apply to penalties, and is the amount of the mandatory tax payment, overdue for payment, but payable in any case, the taxpayer.

In this case, the emergence of arrears may be qualified as damages, if unfair and unreasonable actions of the defendant led to the accrual of additional tax, which would not be payable in the ordinary course of business of a legal entity in civil turnover, or to the loss of the objectively existing right to a deduction.

Recovery as damages of the amount of additional taxes is possible if the unfair actions of the director were of systematic nature, when the non-payment of taxes was caused by the illegal intent of the executive body of the Company, aimed at evading the performance of a public duty for the purpose of unlawful enrichment[10]. 

Thus, the negative results of the tax audit are not automatically the basis for recovery of damages from the director of the company for the accrued tax. And the current judicial practice suggests imposing on the plaintiff the burden of proving the director's intent.

Regarding penalties and fines

In most disputes with a positive outcome, the courts come to the conclusion that there are grounds to recover additional obligations from the head of the company - in the form of paid penalties and fines[11]. 

However, it is important to note that in practice there are also extraordinary arguments regarding the impossibility to recover these amounts as damages.

So, for example, the Arbitration Court of the Moscow District, rejecting the claim for recovery of losses in terms of penalties, pointed out[12]:"The case materials do not have sufficient evidence that the late performance of the obligations of the Company to transfer taxes and contributions was precisely a consequence of illegal actions of the defendant, acting solely for the purpose of causing the company damage.

The penalties accrued by the tax authority are compensation for the budget losses due to late payment of the tax. During the period of delay, the funds constituting the amount of unpaid tax were in the plaintiff's account, could or were used in the business activities to obtain the appropriate economic benefits.

In another case, the Ninth Arbitration Court of Appeal in relation to the fine stated the following[13]: "According to the legal position of the Constitutional Court of the Russian Federation, set out in the decision of December 08, 2017 N 39-P, Article 15 of the Civil Code cannot be used to recover fines for tax offenses imposed on the taxpayer organization from the executives of the debtor. According to the Constitutional Court of the Russian Federation, individuals are not exempt from the obligation to compensate the damage caused, but fines imposed on the organization cannot be recovered from them".

However, the most frequent conclusions of the courts in practice are that the amount of damages to be recovered from the dishonest manager in favor of the company includes the amount of the fine and penalties.

Conclusion

Thus, in the light of up-to-date court practice on cases concerning recovery of losses from a dishonest manager (including ex-manager), incurred as a result of additional tax, penalty and fine charge to the company, the possibility to recover the amount of penalty and fine is very promising.

Recovery of arrears (taxes) in such a procedure, though possible in theory, is complicated by the requirements to prove the defendant's intent. 

In order to prove the necessary conditions for bringing the director to responsibility in the form of compensation for such losses, the plaintiff usually uses the materials of the tax audit. At the same time, the presence of the decision of the tax authority, which has entered into force, by itself, does not relieve the parties from the obligation to prove the essential circumstances of the case.

Therefore, when applying to the court with a claim for recovery of losses in the form of tax assessments, it is necessary to carefully consider the legal position and correctly use the factual circumstances established by the tax authority in the course of control measures, as well as other evidence.

_________________________________

[1] In particular, articles 10, 15, 53, 53.1 of the Civil Code of the Russian Federation

[2] Clauses 1-4 of the Resolution of the Plenum of the HAC RF of 30.07.2013 № 62 "On some issues of compensation for losses by persons who are members of the bodies of a legal entity"

[3] Clause 1 of Article 53.1 of the Civil Code of the RF

[4] Determination of the Supreme Court of the Russian Federation of 06.04.2020 № 56-KG20-2 in case № 2-4326/2018

[5] Ruling of the Arbitration Court of the Northwestern District of 27.12.2022 in case No. A56-20776/2020

[6] See, for example, cases No. A65-23203/2020, A32-48307/2018, A71-1859/2020, A40-107822/2020

[7] See, for example, Cases Nos. A27-14459/2019, A41-3778/2019, A55-33207/2019, A31-12799/2019, A56-85203/2021, A114-7450/2020, A54-10209/2018

[8] For example, Determination of the Supreme Court of the Russian Federation of 09.09.2021 in case No. A33-3832/2019, Decision of the Third Arbitration Court of Appeal of 01.12.2022 in case No. A74-843/2022

[9] Rulings of the Supreme Court of the Russian Federation from 11.05.2018 № 301-ES17-20419, from 18.02.2021 № 306-ES20-24052, from 26.10.2018 № 307-ES18-17204

[10] Ruling of the Arbitration Court of the Moscow District of 23.05.2022 in case No. A41-24909/2020

[11] See, for example, case No. A02-984/2020

[12] Ruling of the Arbitration Court of the Moscow District of 23.05.2022 in case No. A41-24909/2020

[13] Ruling of the Ninth Arbitration Court of Appeal of 13.01.2022 in case No. A40-106188/2021