Issuing a Study on the Amount and Timing of Potential Tax Liabilities

A study on the amount and timing of potential tax liabilities is a critical tool for companies to assess their financial and tax position—especially in situations involving restructuring, mergers, acquisitions, divestments, or during the preparation of financial statements.

This study aims to provide an accurate and proactive estimate of the potential tax obligations a company may incur, based on a comprehensive review of all activities and transactions that could be subject to tax audits.

Objectives of the Study:

• Identify potential taxes due (income tax, VAT, payroll tax, stamp duty, etc.).
• Assess the tax periods that may be subject to audit.
• Estimate the amount of taxes, interest, and penalties potentially owed.
• Support strategic decision-making with a clear tax outlook.
• Prepare the company for unexpected audits and reduce tax risk exposure.

Steps to Conduct the Study:

1. Collect and analyze accounting and tax data for several fiscal years.
2. Review how relevant legal tax provisions were applied by the company.
3. Identify gaps or inconsistencies between actual practices and official tax interpretations.
4. Calculate potential tax liabilities based on various scenarios.
5. Provide a detailed management report with findings and recommendations.

Who Benefits from This Study:

• Local and foreign companies operating in Egypt.
• Investors during merger or acquisition transactions (Due Diligence).
• Internal audit and risk management departments.
• Certified accountants and financial consultants.