The Sofia branch of National Revenue Agency (NRA) has asked courts to declare property deals worth 18.24 million leva void, Bulgarian news agency BTA reported on September 9 2008.

The NRA has concluded that some tax payers have found ways to avoid declaring taxes by selling most of their assets.  Such deals, the NRA concluded have happened between individuals who had close relations and the value of the assets sold overvalued the price paid for them.

There were cases when such deals happened after the NRA has launched tax checks into the activity of certain individuals who have immediately sold their assets to relatives and thus avoided the payment of taxes.

Sometimes, when a company is being checked, its assets are being bought by the head of the company as an individual at a price that is considerably lower than what it would fetch on the market. So far, the NRA has recorded eight cases for such deals worth a total of 18.24 million leva.

As previously reported, the NRA has started checking the sources of income of wealthy Bulgarians three years ago. On September 2, the NRA office in the south-eastern Bulgarian town of Haskovo reported that 14 cases of discrepancies between property ownership and declared income have been found.

The NRA has checked 16 Bulgarians in Haskovo, all of whom owned newly-built and up-scale housing and commercial properties. Of them, 14 will be subject to tax audits after tax inspectors found they were in in possession of undeclared assets or had submitted inconsistent tax returns.

Similar checks as the ones in Haskovo have been launched in Plovdiv, Sofia, Varna and Bourgas.

Tax authorities will check people who have bought real estate worth at least 100 000 euro and who have bought motor vehicles worth at least 80 000 euro.

Checks will be based on gathering public information about properties owned by these people by using sources such as municipalities or the Registry Agency, where information about the acquisition of real estate is filed.

Then tax inspectors will invite the people on the list for a conversation at NRA and will ask where the money for the acquisition has come from. If they present conclusive information, such as a bank loan for example, the check will be over. If they fail to present proof, then a tax audit into their incomes will be launched.