The Inland Revenue has launched book searches of 350 “suspect” driving schools. The various regional inspectors will visit these driving school owners to check for tax evasion. They are among the group of 2,100 driving schools that received a call from the Internal Revenue Service to report but did not comply. A total of 500 driving schools did contact the Inland Revenue after receiving this letter to give an explanation.
Investigations by the Internal Revenue Service show that over two thousand driving schools have large discrepancies between the number of practical exams purchased from the CBR and the stated turnover that should accompany them.
“Driving schools that have reported to us indicate that the lower turnovers are caused by low fees,” Richard Buijs of the Inland Revenue says. “For example, if they do price promotions, have a lot of competition, or supplement their income with benefits. Or if they have the driving school as a side job.”
By the way, text and explanation by driving schools does not exempt them from inspection by the Inland Revenue. “We consider on a case-by-case basis whether we go along with their story. Because of course it can also be an excuse,” Buijs said. “A statement does not provide indemnification. That is put in their file, after which we can still go and check.”
Curiously, the Internal Revenue Service is occasionally told by driving schools that they purchase exams for other driving schools. And that as a result, their number of purchased exams no longer corresponds to the number of driving lessons given. By the way, that is not allowed by the CBR at all.
“A driving school must apply for a practical exam under its own name. And then this name must also be visible on the lesson car during the exam,” said CBR spokesman Coen Sleddering. “Driving schools are not allowed to administer exams for anyone else. The examiners check for that.”
In addition to the 500 driving schools that have contacted the Internal Revenue Service directly, there are also a number that have amended their returns or sent their tax professional to the Internal Revenue Service. How large that group is, Buijs cannot say at this time. That will soon become clear.
To what extent the group of 350 driving schools now under concrete investigation are evading the Tax, this will be clarified within a few months. The Inland Revenue will evaluate these results, and then it will be the turn of the remaining driving schools.
Black driving lessons
Driving schools that provide black driving lessons are a thorn in the side of well-intentioned driving schools and the government. For example, because no VAT (21%), payroll taxes and social security contributions are paid, this leads to massive price erosion. As a result, many professional driving schools are struggling to stay afloat.