Conceptual Framework and Practice of Assessment and Control of Tax Risks of Business Entities under Conditions of Changeable Tax Environment

Abstract

Tax risks are situations in which an enterprise may face loss or damage related to taxation as a result of incorrect application of tax rules, incorrect interpretation of legislation or other circumstances that may lead to negative financial consequences. Enterprises often suffer losses either due to tax due to the accountant's ignorance of tax legislation, or due to the excessive riskiness of the accountant's decision-making and subsequent accrual of penalties, fines, additional payments and even litigation. However, methodological foundations and methodological apparatus for assessing tax risks of business entities have not yet been fully studied. It is accurately proved that study of tax risks classification contributes to more accurate accounting, analysis and management of financial risks of an enterprise, as well as helps to comply with laws and regulations, which is a key factor for successful and sustainable operation of any company. There is an extensive classification of tax risks according to different principles: by type of tax risk, by the source of occurrence (by risk determining factors), according to the time of occurrence, according to the amount of possible losses, according to the type of tax risks consequences, according to the object of connection with other types of risks, according to the nature of consequences, according to the possibility to overcome, and according to the level of probability of tax risks occurrence. Tax risk assessment is an important and integral part of the enterprises tax management in the Russian Federation. This process allows business entities identifying and analyzing potential threats and negative consequences related to taxation, and develop strategies to minimize and manage them. The purpose of the study is to analyze tax risks which enterprises in the Russian Federation face and to develop methods and recommendations for their assessment and management in order to ensure financial stability and compliance with tax legislation. The methodology of the study is formed of standardized methods to assess the degree of compliance of the enterprise tax practice with applicable laws and standards. Empirical methods, in particular the analysis of statistical data, and case studies are used. As a result, the key factors influencing tax risks occurrence are highlighted. Modern methods of assessing tax risks matrix are summarized and practice of applying of tax risk analysis matrix and matrix of paired preferences of tax risks is presented. Ways to minimize tax risks were proposed using the example of LLC Krasnaya Polyana Agro-Industrial Complex, and a scheme of its tax risk control system was proposed. The results of tax risk assessment serve the basis for the development of tax strategies and risk management processes. Enterprises can minimize tax risks by optimizing the tax strategy proposed by the authors, creating reserves and constantly monitoring tax environment changes.