Sunday 20 June 2021

Taxation Requires Professionals To Disclose Client List

doctor-sQCOSTARICA – The next time you visit a doctor, dentist, lawyer, accountant or any other professional, keep in mind that your information is no long priviliged.

Aiming reduce tax evasion by professionals, the  Directorate General of Taxation (Dirección General de Tributación – DGT)  is requiring professionals hand over their client list.

According to an article in La Nacion, Taxation has the power to require professionals the confidential customer information, as long as the data is not related to “professional secrecy” .

- Advertisement -

The information must be “foreseeably relevant for tax purposes,” which includes, according to the legal opinion, financial, economic and property data of customers, says the text published on the Ministry of Finance (Ministerio de Hacienda) website.

Carlos Vargas, director of the DGT, said that this delimits the professional secrecy (privileged information) with regard to the requirements of the Taxation.

“This means we can ask a doctor or lawyer for their client list and what you paid to each but are not require you to tell us intimate matters covered by professional secrecy,” said Vargas.

Professional secrecy is the obligation that certain professions have, by their very nature, not disclose to third  parties, including Taxation, secrets and confidences of their clients.

- Advertisement -

With the new interpretation, however, the application range of professional secrecy for tax purposes is delimited.

For example, a doctor will have not disclose the medical nature of a visit, but, will be required to report to Taxation the name of patients, the amount and how payment was made.

While Taxation argues it will not ask for information protected by professional secrecy, the new interpretation is disputed by legal scholars because they believe violates the right to privacy information.

“The Tax Administration is carrying out incorrect and confusing technical analysis, which brings various standards without any systematization, where the only thing clear is the interest of reaching a conclusion favorable to their interests even at the expense of the law,” says Diego Salto, Specialist in Tax Law, in his column in El Financiero.

For its part, criminal lawyer Mauricio Brenes warns that professionals can be penalized if they provide intimate customer information.

“Article 203 of the Penal Code punishes with imprisonment those with legal obligation to protect secrets, reveal them. In other words, the professional who discloses information to tax authorities about accounting and tax obligations of their customers, is committing a crime, “said Brenes.

- Advertisement -

The Costa Rica Bar Association (Colegio de Abogados) believes it is inappropriate for tax authorities to request such information from lawyers, as under the existing legal system, “it is considered illegal and unconstitutional.”

For its part, the Association of Accountants (Colegio de Contadores) says that professionals a committed to a Code of Ethics, so if a CPA violates these standards he/she would be in clear breach of those rules.

In its statement, the Association said there is no law requiring a professional to provide confidential customer information.

Previously, the government also promoted a bill authorizing the DGT to embargo the assets and bank accounts of taxpayers who cataloged as delinquent without the mediation of a court decision.

Tax evasion. The Comptroller General’s Office (Contraloría General de la República) insists that from 2011there is great drain of funds for evading income tax from professionals.

A report this year shows that only 19% of potential revenue of ¢79 billion colones in income tax from professionals reaches state coffers.

- Advertisement -

We strive for accuracy in its reports. But if you see something that doesn’t look right, send us an email. The Q reviews and updates its content regularly to ensure it’s accuracy.

"Rico" is the crazy mind behind the Q media websites, a series of online magazines where everything is Q! In these times of new normal, stay at home. Stay safe. Stay healthy.

Related Articles

Today’s Vehicle Restriction June 20: only “EVENS” can circulate

Today, Sunday, June 20, only vehicles with "EVEN" ending plates CAN...

Internet speed decreases during peaks in service

QCOSTARICA - Ever wonder why your surfing on the Internet slows...


Heavy downpours generated the first phreatic eruption of this year at the Turrialba volcano

QCOSTARICA - Several residents of La Pastora, La Central and Monte Calas, in the vicinity of the Turrialba volcano, heard a loud rumbling early...

Nathalie Álvarez Mesén’s feature debut, Clara Sola, ready for the Cannes Directors’ Fortnight

Q ENTERTAINMENT (CINEUROPA) Nathalie Álvarez Mesén’s debut feature, Clara Sola, is ready to take part in this year’s Directors’ Fortnight at the Cannes Film...

Ortega government accuses imprisoned opponents of receiving money from the United States to overthrow him

TODAY NICARAGUA – The Nicaraguan government assures that the imprisoned political opponents detained on charges of “inciting foreign intervention” are “usurpers” financed by the...

Today’s Vehicle Restriction June 14: 1 & 2 CANNOT circulate

Today, Monday, June 14, vehicles with plates ending 1 & 2 CANNOT circulate The measure is countrywide and applied between 5:00 am and 9:00 pm,...

Internet speed decreases during peaks in service

QCOSTARICA - Ever wonder why your surfing on the Internet slows down, to even a crawl, mainly in the evenings? This is due to...

Immigration system failure affected passengers at the San Jose airport Monday

QCOSTARICA -  In yet another system-wide failure in the immigration check-out, passengers looking to leave Costa Rica Monday morning by way of the Juan...

Vaccination commission endorses J & J vaccine, says no to Sinovac

QCOSTARICA - The Comisión Nacional de Vacunación y Epidemiología (CNVE)  - National Vaccination and Epidemiology Commission - endorsed the use of Johnson and Johnson...

Construction companies that paid alleged bribes would be disqualified for ten years

QCOSTARICA - If it is proven in a final judgment that they did pay bribes to Conavi officials, several companies could be disqualified from...

Since 2018 MECO has received contracts from the State for more than ¢139 billion

QCOSTARICA - Almost ¢140 billion colones (US$227 million dollars) is the amount the MECO construction company was able to snare for public works contracts...


Get our daily newsletter with the latest posts directly in your mailbox. Click on the subscribe and fill out the form. It's that simple!

Log In

Forgot password?

Forgot password?

Enter your account data and we will send you a link to reset your password.

Your password reset link appears to be invalid or expired.

Log in

Privacy Policy

Add to Collection

No Collections

Here you'll find all collections you've created before.