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TAX REMEDIES R

FROM ATTY. RIZALINA V. LUMBERA’S LECTURES

NIRC

TAX PAYER

R
In Good Faith

Fraudulent

Doesn’t File

I Return
It is a verified statement prepared by the taxpayer for the material information relevant to the kind of tax you are computing for and paying for.

Types of Tax Payer Where to File (If a Return is filed in a wrong When to File
Returns: venue, it is as if you did not file any return at all)
Individual Person Place of Residence On or before April 15 of the ff. year. (15th day of the 4th Mo. Ff. the C.Y)
(1 Return only)
Person ETB Place of Residence or Place of Business 3 Quarterly Returns: 60 days from close of the quarter
Corporation Principal Place of Business 1, 2, 3, 4 Final Consolidated Return
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NIT Using Calendar Yr: On or before April 15 of thr ff. yr. (15th day of the 4th Mo. Ff. the C.Y)
Using Fiscal Yr : On or before the 15th day of the 4th mo. Ff. the close of the F.Y.
Example: Fiscal Yr:
Feb – March – April (1st Qtr)
June 30: Ito yung 60 days from close of the (1st) quarter

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May – June – July (2nd Qtr)
Sept 30: Ito yung 60 days from close of the (2nd) quarter
Aug – Sept – Oct (3rd Qtr)
Dec 30: Ito yung 60 days from close of the (3rd) quarter

Nov – Dec – Jan (4th Qtr)


Ito yung close of the F.Y.

May 15: Ito yung 15th day of the 4th month ff the close of the F.Y.
Real Property Where the property is located (CGT) Every 10th day of the Month
Shares of Stocks
FWT Passive Income Place of the Witholding Agent (Ex. Bank: kung
nasaan yung bank)
CWT Witholding Agent Residence of the Witholding Agent Every 10th day of the Month
Monthly Returns: 2oth day of the month
VAT Seller Side Place of business of the Seller
Quarterly Return: On or before the 25th day after close of the quarter
Monthly Returns: 2oth day of the month
% Tax Seller Side Place of business of the Seller
Quarterly Return: On or before the 25th day after close of the quarter
EXCISE Place of manufacture Upon departure of the product from the place of manufacture
RC/NRC/RA Place of residence of the deceased at the 6 months from death of the deceased
time of death Example: Date of Death: Feb. 14
ESTATE
Non-Resident Office of the Commissioner Due Date: Aug. 15
Alien Reason: No place of Residence
DONOR’S RC/NRC/RA Residence of the Donor
Non-Resident Office of the Commissioner 30 days from the giving of a gift
Alien Reason: No place of Residence
Notes: 1. Failure to file, the Tax payer is subjected to: Tawag dito ay DEFFICIENCY TAX
a. 25% Penalty; DELINQUENCY INTEREST
b. 20% interest computed per annum daily; DEFFICIENCY INTEREST (20%)
c. If fraudulent return: 50% surcharge will be imposed (20%) -pinagbabayad ka ng BIR,
-Kulang ang binayaran based on the amount
2. Disputable Presumption: All Returns are presumed prepared and filed by the Tax Payer in Good Faith. mo nung nagfile ka ng VS. indicated, but you did not
Return pay so you incurred
Delinquency I. amounting
to 20% of the total tax due.
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3. When the tax due for individual is more than 2K pesos, he/she may divide it into two. Pay by installment, but you still have to file a return on or before April 15:
a. 50% payable on or before April 15;
b. Another 50% payable on or before July 15 of the same year.

Q: Can you pay using your Credit Cards?


A: Yes, provided that:
1. The Banks are accredited to the BIR. There is an agreement between Bank and BIR (Local Banks lang);
2. When you swipe it, that is the date of payment of your tax;
3. Online Transaction: until 12 midnight. So pag 11:59pm ka nagkaskas, valid payment.

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BIR
• Pag in Good Faith: Tapos na!

A
If Fraudulent; or LA - Letter of Authority [: to investigate: you will be given 15 days to reply and produce all the documents]
• Did not file. PAN – Preliminary Assessment Notice [W or w/o reply, the BIR can issue PAN]
FAN – Final Assessment Notice [W/ or w/o reply w/in 15 days, the BIR will issue FAN)

Prescriptive period on the part of the BIR to issue FAN, if the Return is filed: Requisites of a Valid Waiver:
1. In Good Faith: 3 Yrs from Due Date 1. Since it is a contract bet. the BIR and TP, it must be in writing;
a. Filed before due date: 3 yrs from due date; 2. The contract is to extend the assessment period, therefore the W. should
b. Filed on due date : 3 yrs from due date be executed
c. Filed beyond due date: 3 yrs from the date of filing. prior to this period;
2. Fraudeulenty: 10 yrs from the BIR’s discovery of the fraudulent return. 3. The W. should indicate the signature of both the BIR and TP;
-Kahit filed before, on or beyond due date pa: 10 yrs pa rin. 4. It should provide for the date of execution, so that the BIR will know that
3. If the Tax Payer did not file a return. The BIR files a return on your behalf or to issue the same
Was entered into prior to the expiration of the period.
the FAN w/in 10yrs.
5. It must be in 3 Copies (one copy goes to the BIR, TP and Docket File)
Q: Can you amend the Return that you filed? Note: W/o these requisites, the W. will not be valid.
A: Yes, you call it Amended Return (AR). Provided that no notice of investigation is received.
Q: Can you amend when there is already a Letter of Authority?
THE FAN MUST PROPERLY BE RECEIVED BY THE TAXPAPYER.
A: No, never. Because you already know that you are subject of investigation
• When the BIR violates the proper procedure, it was as if no FAN was
Q: What happened to the Original Return and Amended Return?
received by the TP, and therefore the Gov’t cannot collect.
A: Both are combined and the BIR will examine both of them.
Q: HOW IS FAN RECEIVED?
Q: When you did not file any return?
A: 1. When the TP is present: Personal Service;
A: The BIR may file one on your behalf. This is one of the powers vested in the office of the BIR. 2. When the TP is present but doesn’t want to receive it: Request for the presence
POWERS OF THE BIR (Secs 5-15) of the Brgy. Capt and to be a witness as you tender the FAN;
1. To issue subpoena to owners of similar businesses as yours; 3. When the TP is not present: Substituted Service: to a person of sufficient
2. To issue subpoena duces tecum as testificandum to you or your employees; discretion.
3. To provide for presumptive gross sales or gross receipts based on the best evidence 4. When the person of sufficient discretion doesn’t want to receive the it:
obtainable under the circumstances. Request for the presence of the Brgy. Capt and to be a witness as you tender the
4. To prescribe your gross receipts and gross sales based on the gross sales and gross receipts FAN;
of similar businesses. Q: If Corporation? A: Personal Service to:
1. President; 4. In house Counsel
Patapos na si 3yrs di pa na-issue si FAN: 2. Corporate Secretary; 5. General Manager
Q: What will the BIR do? 3. Managing Partner; 6. Treasurer
A: The BIR will ask you to WAIVE your right to be assessed. - Substituted Service: To a Person of sufficient discretion.
Q: If the TP did not waive? -If Substituted service is not possible: BY MAILING: (either by Registered Mail, Fast
A: The BIR will issue Jeopardy Assessment (JA) Courier or Regular Mail; there is no priority here)
An assessment w/c is in the nature of FAN given or issued by the BIR -Failure on the part of the BIR to follow these procedures is a denial of due process.
w/o the benefit of the full audit of the financial obligations
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TAX PAYER (Pag natanggap mo si FAN, mag-file ka na ng Protest!)
The protest may be in the nature of:
1. Motion for Reconsideration

P
Protest
2. Motion for Recomputation
3. Motion for Reinvestigation

The assumption is that the TX is


The assumption is that
the TX is supposed to attach
documents to the protest

Not attaching or appending to the


Protest documents.

The procedure of LA, PAN AND FAN must strictly be followed by WHEN: 30 days from your receipt of the FAN;
the BIR, otherwise the TX is denied of the due process. -It should be in writing;
-filed with the RDO w/c issued the FAN;
Instances that the PAN is not required to be issued: Sec. 228 -it should be filed w/in 30 days from your
1. When there is mathematical error in the computation as
Receipt of the FAN.
reflected in the return;
2. When there is a discrepancy between the withholding tax
as reflected in your return and the withholding taxes as
remitted to me;
3. When it involves excise taxes;
4. When there is importation.

WHEN IS A FAN A VALID FAN?


Requisites:
1. It must be in writing;
2. It is addressed to the tax payer;
3. It provides for the amount Tax due;
4. It provides for the basis in fact and in law of the tax due;
5. It provides for the due date;
6. It demands for payment;
7. Signed by the duly authorized BIR officer;
8. Send to and received by the tax payer;
9. Issued w/in the prescriptive periods of assessment.
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BIR: Once Protest is submitted, TAX PAYER CTA DIVISION
the BIR may: the CTA may:
1. Grant; or -----------------If Granted ------------- Masaya na si TP, The process is done. 1. Grant; or
2. Deny; or -----------------If Denied ---------------Malungkot si TP, w/c means the BIR doesn’t agree with the TP If denied, The TP 2. Deny; or
3. Partly G/D; or ---------------If Partly G/D------------Pareho masaya/malungkot si TP & BIR partly G/D, must 3. Partly G/D
4. Sits on it for 180 days. ----Did not act on it-------Galit si Tax Payer or sits on it go to Note: Here, no more
For 180 days CTA Div. non-action

30 Days from your receipt


of the actual decision,
denying, or partly G/D,
or from the expiration
of the 180-day period.

Example:
FAN --- Protest

30 days

Q: What if you filed your


Protest on the 18th
day of the 30-day
period? Kelan mag-
sisimula ung 180-
day period?
A: On that 18th day of the
30-day period when you
filed your Protest begins
the 180-day period
Q: What if the 180-day period
Expires & the BIR didn’t act
on your Protest?
A: you MAY go up to the CTA
Division w/in 30 days.

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JURISDICTION OF THE CTA DIVISION The Prejudice Party, in the meantime, may file MR or Motion for New Trial for a period of 15 Days.
1. The CTA has an Exclusive Appellate Jurisdiction (EAJ) on decisions of the
BIR denying the claim for refund of excess input vat in Zero-Rated
transactions;
Q: When the Protest is pending, can
2. Based on the non-action of BIR w/in 120 days in the case of claim for
the BIR collect?
refund of excess input vat in Zero-rated transaction;
A: Yes, because taxes are the lifeblood
3. The CTA has also an EAJ over actual decisions of the BIR denying the
of the Government.
Protest;
Q: How and when the BIR may
4. The CTA has EAJ over non-action of the BIR in Protest Cases.
Collect?
A: 1. Administrative Mode:
CONCEPTS: Lien, forfeiture warrant of Distraint & levy, garnishment,
1. If you have a pending protest based on a FAN issued by the BIR & the BIR Compromise, or suspension of Taxable period.
subsequently issues another assessment involving substantially the same 2. Judicial Mode:
tax covered by the previous FAN & for w/c a Protest is already filed, no File cases in court:
need to file a separate protest on that; a. Civil;
2. If the BIR issues a succeeding assessment w/c is not substantially the b. Criminal
same as the one originally issued & for w/c you already filed a protest. For
the succeeding assessment, you need to file another protest, otherwise, WHEN:
that becomes Final and Executory. 1. The BIR can collect w/in 5 yrs from receipt of FAN by
3. The CTA has the power to entertain: the TP;
a. Petition for Certiorari under R65; or 2. When the TP filed a fraudulent return, the BIR may:
b. Issue TRO, or Injunction or Certiorari. a. issue an assessment 10 yrs from the BIR’s
REASON: The SC states that when the law speaks of the Rules of Court discovery; or b. collect w/in 10 yrs from the
suppletorily applies to the Internal Rules and Procedure of the CTA, dapat discovery of the fraudulent return.
daw mag-apply din ang ating Rules of Court.
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ADMINISTRATIVE MODE JUDICIAL MODE: the BIR goes to the court
When you receive the notice of METC, MCTC,
RTC CTA RULES:
garnishment, your pending MTC
CIVIL
1. The CTA has EAJ over Protest Cases;
protest is deemed denied or 1M & above (exclusive of 2. The CTA has an Exclusive Original Jurisdiction
denied with actual decision. With in Metro Manila More than 400K Penalties, Interest & over tax cases involving 1 Million and above.
-ganyan effect ng Notice of Surcharges)
Garnishment. Outside Metro Manila More than 300K
-this means, pupunta ka ng
W/O Tax Deficiency More than 6 Years
CTA w/in a period of 30 days 2 KIND OF CRIMINAL OFFENSES UNDER THE TAX CODE:
(based on the NO JURSISDICTION
from your receipt of the N. of
Criminal

prescribed penalty 1. Which does not result in tax deficiency. Ex:


Garnishment or Warrant of failure to obey subpoena is an offense in itself.
Distraint or Levy. Where to file? The venue is based on the
Results in Tax W/in
Deficiency MM 1M & above (exclusive of prescribed penalty;
More than 400K
Penalties, Interest & 2. One w/c results in tax deficiency.
O. MM More than 300K Surcharges)

Example on CIVIL CASE:


PARTIES: BIR VS DEFENDANT (W/IN MM) MTC RTC CTA En Banc
Q: WHEN DO WE GO DIRECTLY TO CTA EN BANC?
(Talo ka) (In the exercise of its (w/in 30 days)
CASE: FOR COLLECTION OF TAXES & INTEREST A: 1. When the decision being appealed from is rendered in the
Appellate J. [15 days] exercise of Appellate Jurisdiction like in this ex. case.
PRINCIPAL AMOUNT: 350k Talo ka ulit) 2. When it involves the decision of the Central Board of
INTEREST: 70K
Assessment Appeals.
PENALTY: 87,500 RULE:
SURCHARGE: 175k 1. When you have a Pending Appeal both in the CTA Division and CTA en banc, both will be consolidated and there will
NOTE: YOU APPLY THE TOTALITY RULE HERE be no instance that a conflicting decision involving the FAN.
(The only time interest and damages are included 2. If the principal amount of tax due is 1Million and above, CTA exercises Original Jurisdiction.
In the jurisdictional amount is when the main action is damages) 3. Pag sa RTC in its Original Jurisdiction, talo ka, sa CTA Division ka akyat muna w/in 30 days, pag talo ka ulit, you now
proceed to CTA En Banc w/in 15 days.
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CTA EN BANC
(kung sino matatalo SUPREME
dito, punta na ng: COURT

W/in 15 DAYS W/in 15 DAYS


CRIMINAL CASE W/C RESULTS IN TAX DEFICIENCY FISCAL LEVEL: When the Fiscal finds Probable Cause,
Example: Failure to issue receipts (it means di mo files Info in court.
dineclare as part of your gross income sigurado Q: Can you file a petition for review before the DOJ
may tax deficiency parang estafa.) Secretary?
A: Yes, you have 10 days to file a Pet. For Review
Q: WHERE TO FILE? before the DOJ Secretary.
A: It depends on the Jurisdictional amount Q: is that allowed in Tax cases?
Q: Does the CTA have Exclusive Original A: Yes. When the DOJ Sec. resolves the Pet. Rev and
Jurisdiction over criminal cases w/c result in Tax denied, tuloy ang arraignment. If GRANTED, it is
Deficiency? discretionary upon the court to dismiss the case or
A: Yes, when the principal amount of tax due is 1M not. It doesn’t mean that once a pet rev is granted by
& above exclusive of interest, penalties & the DOJ Sec, the judge will dismiss the case. The
surcharges. The CTA exercises Exclusive Original court is not divested of jurisdiction. Once it acquires
Jurisdiction in Civil Cases & Criminal Cases when jurisdiction, it is forever holding jurisdiction over the
the tax due involved is 1M & above. criminal case.
But, if the criminal offense does not result in any Q: Does the CTA have jurisdiction over petitions for
tax deficiency, the Jurisdiction of the CTA is only Review decided by the Secretary of Justice on tax
appellate, never Original. That’s the rule. criminal cases?
A: PERSONAL OPINION: It does not have, it is still the
CA w/c has EOJ. But there is one pending case in SC
Q: CAN THE PERIOD OF COLLECTION BE w/c one of the issues raised is: Yes, the CTA has
SUSPENDED AS WELL? Jurisdiction over PET REV on tax criminal cases
A: YES, if the period of assessment is suspended decided by the DOJ Secretary.
based on any of the grounds listed under Sec.
223, the same grounds if they are existing at the
time of collection may also suspend the period of
collection. These periods are 10 and 5 yrs.

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Refund of Excess Input Vat in
Refund of Excessively Assessed/Collected and Illegally
Zero Rated Transaction Q: IF YOUR REFUND IS APPROVED, WHAT WILL YOU GET?
Assessed and Collected
(2:120:30) A: Tax Credit Certificate, HINDI SALAPI.
There is element of illegality in the collection & No element of Bad Faith and
ASSUMPTION assessment made by the BIR Fraud
1. The claim for Refund must be filed w/in 2 yrs Must be filed w/in 2 yrs from
REQUISITES Refund of Excess
from payment; the close of the quarter when
2. The appeal to the CTA must likewise be filed you had zero-rated transaction. input vat in zero-rated 2 120 30 days
w/in the same 2-yr period. transaction YRS DAYS (MUST)

Actual date of
Payment 30 180 30 Days
Protest Cases DAYS (MAY)
0 2yrs

Possible scenarios: No decision received paubos na si 2-


yr period:
Refund of Excessively
1. File ka na sa CTA; Assessed/Collected, 2 30 2
2. W/ BIR Decision, file ka na sa CTA bago maubos Illegally Assessed/Collected YRS DAYS YRS
si 2-yr. period;
3. Pag 40 days pa natitira, hanggang 30 days lang
ng 40 days na yan ang pagfile mo, di mo pwede
Pag: Pag:
ubusin ang 40 days;
Assessment ay 3 yrs Assessment ay 10 yrs
4. Paano pag natanggap mo BIR decision 25 days
Collection ay 5 yrs Collection ay 5 Yrs
n lang bago maubos si 2-yr period? Kahit
originally, 30 days ang pag-akyat, hanggang 25
days na lang, wala kang add’l 5 days, bawal.
Refund of Excess Input Vat in Zero- Protest Cases:
NOTE: Pag nakatanggap ka ng decision kulang na ang
Rated Transaction:
30 days para umakyat sa CTA, basta hanggang
Refund: 2 Yrs Filing w/ the BIR : 30 days
2 years lang; Pag sobra pa sa 30 days ang
Non-Action of BIR: 120 days The BIR does not act w/in: 180 days
Natitira, basta hanggang 30 days ka lang.
Akyat sa CTA : 30 days TP MAY go up to CTA : 30 days

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