Taxation
year through a tax credit certificate in
November 25, 2016
PWD(or senior citizen) - must be the
purchaser not the seller
1,200 purchase price inclusive of VAT.
(divided by .12 vat to get vat and exclude
it)=1000
The 1000 must be placed in the VAT
exempt sales.
How to treat the 20%? It is a tax
deductible expense not anymore a
creditable tax. Not output tax is made.
What are the differences?
If creditable tax, it is considered as
advance tax, and a disadvantage to the
government because it will yield less
income to government.
A seller is liable only to pay output tax
minus input tax, and not the entire 12%
RR 17-2013 does not amend anything in
the law
The period to keep the records is
10 years from the day the last day law
requires to file a return or the actual
filing, whichever comes later.
Sec. 228 subject to RR 18-2013
PAN is just a first step in the process and a
mere notification.
VAT returns by a tax payer
-4 quarterly returns and 8 monthly
returns
Tax credit - applied to the next taxable
payment of all internal revenue taxes
except withholding taxes
Tax return - a refund from the government
in the form of cash or check
Carry-over - applied to the next quarter
A response to a PAN NOT considred as
administrative process - within 15 days
from receipt
- if taxpayer does not reply, the BIR
will issue a FAN within 15 days, and
considered in default. But if he replies, the
same, FAN will be issued after 15days
from the reply. A reply to a PAN is not
required because it is merely a NOTICE.
Notice of informal conference -
before, required. But now, there is not
anymore required, because there is now a
required PAN as stated in RR 18-2013
GR179343 fishwealth
Sec 203, 222,223, 91-B and 92
GR 139736 BPI this is old case. This
is merely for correction because there is a
doctrine there that has been changed
already
December 10
Counting of periods (example: 15 days, 30
days, 60 days)
Calendar days.
General rule:
Sec 203- prescriptive period under
ordinary circumstances - 3 yrs. From the
date of the return is filed or the last day
prescribed by law to file return, whichever
comes later.
(the issuance of the assessment, not
the receipt)
Exception:
Sec 222 (a) - prescription for
extraordinary circumstances- 10 years
from discovery. For false or fraudulent
return.
General rule: There can be no collection in
court without assessment. Therefore, there
can be no collection case beyond the
prescriptive period where no assessment
was made.
Exception:
-when there is no assessment
needed. Example, the taxpayer paid
less than what his return indicated.
-When the taxpayer availed of a
installment scheme
*So, even if they send an
assessment even if there is no need,
they can still go to court for that.
- the BIR can file a criminal case
even if they did not issue an
assessment.
Example is sec. 256 -
criminal case for failure to pay, or
for tax evasion. (because if
all the elements are present,
they can file a criminal case)
Sec 222 (b)
- talks about extension of time to file
assessment. There are requisites, VERY
important. It is
* the reckoning period to count for the
prescriptive period to collect within 5
years is from the date of the assessment of
the tax (FAN) , or if protested, from the
FDDA. Such 5 year period is either under
ordinary or extraordinary prescriptive
periods.
Sec 222 (d)
- Talks about extension of collection
*these two subsections talk about ordinary
prescriptive period, not the extraordinary.
Not extraordinary because the law does
not allow extension for the extraordinary
prescriptive period.
* If the taxpayer filed his return late. And
protested the assessment. The protest of
the assessment of re investigation with
favorable grant by the commissioner. If
only protest for reconsideration, cannot
toll the prescriptive period.
So, the BIR should require the taxpayer to
execute waiver in order to prevent
prescription of the period.
Sec 223
*the period to assess and period to collect
is suspended when:
1. Taxpayer is out of the Philippines
2. Estate tax, if burdensome to estate,
extension to collect upon grant by the
Commissioner.
Sec 248 B
-Provides a presumption of false or
fraudulent return willfully made, without
need of proof. When the under declaration
of the taxes in the return exceeds 30% of
the correct. Substantial over declarations
or substantial deductions
*To compute 30% of income, the taxable
income may be gross income and not
merely net income.
December 17, 2016
BIR 1901 form - form to change entries in
the record of the taxpayer (update of
status)
Senario: ITR June 30, 2012
June 20 2015 PAN , july 20, 2015
- the assessment was filed out of
the prescriptive period because the
assessment pertained by law id the
FAN, not the PAN. PAN is a mere
notice and not the assessment that
apprises the taxpayer of his tax
deficiency, the computation, the facts,
and the law based.
SEC 6 (B) - authority given to the BIR to
make a return incase the Taxpayer does
not file his return.
*law on prescription, as a remedial
measure should be liberally construed in
order to
* a waiver is not a unilateral act but a
bilateral act by the BIR and tax payer, an
agreement by them.... That is why a copy
must be given to the taxpayer
* there is no relinquishment of the
taxpayer to invoke the right of
prescription. It is only the original period
that is waived. Not the prescription itself.
There should be a definite period of
extension. Another extension can be made
provided it is made within the period
agreed upon.
December 3,2016
RR 17, 2013 merely explains the
provision in Sec 235 on prescription of
keeping of books.
RR 18-2013- investigating office and
reviewing office
*Investigating office > reviewing office >
Assessment office of the Regional director
*In big companies, it is the National that
handles them.
*In case when it is not clear whether the
request of the taxpayer is for
reinvestigation or reconsideration, it is
presumed that it is the latter so that:
- the officer need not wait for the
additional documents
- there is no need to transfer the
case to a different division (not sure...
Look for this i the RR)
IN the future, this RR might be changed
because there is no annotation by the SC
of the congress on the law
*If after 30 days from the lapse of 180
days from the opposition by the tax payer,
Is there a presumption of the ruling? It
depends
- if there is no appeal made by the
taxpayer to the CTA, there is no
presumption
- if there is an appeal, there is deemed
to be a decision by the officer ruling in
denial of the protest.
* if the assessment is signed by the
Commissioner, will the case be under the
regional or the national? - it is under
national...
* the one who should issue/sign the
FDDA, he must have also be the one who
issued the FAN. It cannot be that the FAN
was issued by the regional director, and
the FDDA is signed by the Commissioner.
Final Assessment Notice VS Final
Decision on Disputed Assessment
- FDDA will not be issued if taxpayer did
not file a protest
* motion for reconsideration does not toll
the running of the prescription period to
appeal. Failure to appeal while waiting for
the motion for reconsideration within the
reglementary period bars the remedy of
appeal.
- If the one who issued the FDDA is the
regional director, and the taxpayer filed
for reconsideration to the Commissioner,
is the FDDA final and executory? No
because it is a remedy provided in RR 18-
2013 since the RD is an authorized
representative of the Commissioner as
provided in 3.1.4 (ii) in the RR 7th
paragraph
* assessment must contain:
- facts
- law based
- signature
- authority of the collecting officer
- the computation of the defficiency tax
- demand to be protested within a
prescribed period
* Is there a situation in which a a FAN is
also considered a FDDA?
Gen. Rule: NONE
Exception: in Allied Banking
Corp VS CIR held 2010 (but the mistake
in this case will not happen anymore
because of the wordings in the FAN as
provided in the annex B of the RR18-2013
that there must be specific words as
provided therein which is clear), there was
a decision on that.
principle of that case: There is a
difference between the word protest
versus appeal
Protest- 3 administrative
remedies (re-investigation,
review, appeal(?))
* PAN is mandatory in the case of
Metrosuperama
* there is presumption that taxpayer
received the notice. However, when there
is a negative allegation of receipt, burden
is shifted to the CIR to prove receipt by
the taxpayer
* MEMORIZE the 5 exceptions where
PAN is not needed
*audit working papers- papers which
reflect the audit works of the revenue
officers. These are attached to the
assessment. BUT these alone are not
sufficient in the appraisal to the taxpayer
of the assessment of its deficiency taxes.
The notice itself must contain the details
of the deficiency and is supported by laws
* the higher office issues the PAN not the
investigating office
* no more preliminary conference as there
is already a PAN as amended by the RR
January 7,2017
205 -227 - delinquent accounts
Delinquent accounts arises from - 1.
Defficiency assessment becoming final
and executory.
1. When the tax payer failed to
file a valid protest on time.
2. Failed to elevate case to CIR or
court and FDDA is filed by the Comm
3. When CTA decided the case in
favor of the governemnt and taxpayer
did not file an appeal or motion for
recon. The decision must contain that
the taxpayer must pay.
217 - for collection
205 - remedies for collection of delinquent
taxes.
- includes administrative and judicial
remedies.
1. Service of warrant of distraint and
levy
a) Distraint - personal properties
i. Garnishment - in the hands
of 3rd persons
b) Levy - real property. Annotation
in the title
i. Serve tax lien notice
ii. Serve warrant
2. Judicial
a) Civil
b) Criminal
- cannot file criminal case under
203. Because under that sec, no
punishable act is stated there.
- under sec 222, can file criminal
case
- sec 255 - can file criminal case
even without an assessment
because of failure to file a return.
-sec 254 - this sec supports filing
of criminal case under sec 222 for
filing of false or fraudulent
return.
- refers to tax evasion.
 - criminal act: evade or
defeat any tax or evade or defeat GR 139858
payment of tax. Tulio
- if there is assessment
and became final and GR 130430
executory, file collection case Sison
under sec 205., but for
criminal case, under 254. GR116033
- under sec 254, criminal Sandiganbayan
act is evade or defeat
payment of tax. GR 120935 & 122457 (consolidated)
- if no assessment, Adamson
evade or defeat ANY tax
because the liability is not
yet established. Sec 205-227, 247-254

- In making the taxpayer sign a Kudos metal, petron and azarcon

waiver, the period suspended there is the
period to collect NOT the period to assess.
Sec 253-268
204 in relation to 6f7c
Case of Marcos Vs CA Sec 290

- the BIR can garnish funds from foreign

banks through Dept of foreign affairs
- there must be strict compliance as to the
legal requirements for the sale of
properties subject of distraint and levy.

218 - injunction not allowed. Ammended

by RA 9282 - CTA can now enjoin

CIR vs Gonzales 177279

GR162852
Com vs petron185568
Gr 178087

READ: very important la.

GR 202695
GGM

GR 198677
CIR V BASF
 executed after, it pertains to period to

Finals collect, is suspended. It resumes after the

issuance of FDDA.

* once the FAN is issued on time, there is

no more issue on the prescriptive period
for the assessment.

February 4
* resort to court is always jurisdictional.
ammendment When resort to court has prescribed, it
affects the jurisdiction of the court.
* In corporations, they can adopt a fiscal
year (12 month period, not merely jan to
dec)
-required to file return 15th day of the Sec 247
th
4 month after closing of taxable period
* civil penalties, cannot be collected
separately from the tax liability
* There is no prohibition to amend ITR
after 3 years from filing. So, if there was * in case of the government, the penalties
yet no notice of audit within such time must be shouldered by the officer.
even after the lapse of 3 years from filing,
they can still amend the ITR.
* no more issue of wrong venue because
of the computerization of the BIR. You
* Anything received by employee who is a cannot file unless you are registered in the
minimum wage earner is exempted from particular district
income tax of all income received.

* memorize the instances where 25%

* only zero rated sales (sales from outside surcharge may be charged sec 248.
the Philippines) can be claimed as a tax
refund or tax credit certificate.
* memorize also cases when 50%
surcharge to apply.
* it is the filing of the FAN, not PAN that
tolls the prescription period because PAN
is merely a notice that an assessment will * 2 surcharge available, 25% or 50%
be sent. It is not the assessment that is depending on the instances
contemplated by the law but the FAN.

* interest of 20% per annum for the

* if waiver is executed before issuance of enumeration given for delinquency.
assessment, it serves as extension for BIR Memorize as well.
to issue assessment. If the waiver is

*on the surcharge, it is only one
imposition. It is only on the interest that
accrue every year
*in sec. 252 there must be conviction first.
* sec 253 to 267 must be read... Included
in finals
* sec 204 - authority of commissioner to
refund, collect or abate tax
*example of reasonable doubt as to
validity:
- jeopardy assessment - made
without a complete submission of
evidence. No thorough investigation
of all the documents, even if the
failure to examine is by reason of the
taxpayer to obey summons by the
BIR.
* Sec 204
compromise tax:
- Minimum of 40% in case of
reasonable doubt
- In case of financial incapacity, 10%
*the rates are not absolute because the
higher authority has discretion to lower it
with the approval of the Commissioner or
the National evaluation board.
- composed of 4 members:
Regional director as chairman with
the assistant regional director, chief of
legal division, chief of assessment,
chief of..... (look at your recording
pls... It will come out.promise)
* abatement - in cases of unjust and
excess
* letter c under 204 -
Significance of credit claim on the
taxpayer to file a written claim within 2
year period to the BIR, where in fact the
law provides that a return filed showing
over payment is deemed as a written claim
for over payment:
-
*sec 6F - exception to bank secrecy laws.
Look at the instances pls. There must first
be a written waiver to the bir.
*sec 7C - in case of compromise to be
decided by the National evaluation board
above 500k but not more than 1M of basic
tax. But the Commissioner may decide to
compromise the application himself.
* there is no compromise that the
Commissioner decides alone. It is the
National Evaluation board (in actual
practice)
*pp vs Sandigan bayan and bienvenido tan
GR 1532
*GR 187485
*Mindanao one v 193301
*Gr 184823
*Rev regulation 30 -2002
*RR 9-2013
*Sec 112
*Sec 229
February 11, 2017
*Compromise to be decided by the
Regional Evaluation Board:
A. If the assessment is issued by NOT
the national office, AND
B. the basic tax is 500k or less
* if assessment is issued by the national
office, it is the Commissioner OR the
REB
* If the amount exceeds 1M, to be decided
by the REB
*******Please listen again with your
recording on this above... Items
missing********
*RR 9-2013 - approval of majority
members of the Regional Evaluation
Board with the concurrence of the
Commissioner.
* People VS Sandiganbayan
*RR 30-2002 (VERY important...
Memorize it.... Love it)
- see cases when compromise can be
made and its exceptions
* there is no compromise in
withholding tax cases because
- not a tax
- real tax payer is not the withholding
agent
*why estate tax is not one of the taxes
subject to compromise based on financial
capacity?
- because the estate is presumed to
have properties
- but can be compromised based on
reasonable doubt
* criminal violations.
- unless already filed in court.
* when tax payer files a request for
reconsideration, it does not toll the
prescriptive period to collect NOT period
to make assessment.
* basis of of compromise:
- jeopardy assessment
- arbitrary in nature
- best evidence obtainable and
reason to believe that the disputed
assessment
- within prescriptive period as
extended by the waiver of taxpayer to
extend period to issue assessment
(there must be a waiver) and the
taxpayer questions the waiver.
- any other cases that there is
reason to believe that the
case/assessment is lacking in legal
and factual basis
* cases of financial incapacity see the
RR.
* 10% for financial incapacity and
other cases, 40%
- take note that they are only
minimum. They can provide a bigger
one
* abatement grounds
1. Excessive and arbitrary
2. Collection cost does not justify the
amount
*refund
- just like tax exemption, construed
against the taxpayer
*Sec 204 C grounds to credit or refund
1. erroneous payment - paying more
what is due. Or not due to the government.
2. illegally received - no law
providing for payment of the tax actually
paid.
 3. Unauthorized imposition of
payment of penalties
4. Refund the value of internal
revenue stamps when returned in good
condition
5. Sec 58 (d) over payment by the
withholding agent
*Electronic Filing Payment Scheme/
System?
- additional 5 days to file the return as
compared to non-EFPS filing.
*there is a need to file a written claim
under Sec 2014 (c) even though the law
provides that a file showing an over
payment shall be deemed a demand in
order to avail of judicial remedies in
accordance with sec 229. (IMPORTANT.
Will come out in the finals 100%)
*the commissioner may still refund or
credit the tax even though there was
already lapse of 2 years as provided in Sec
204 (c) because the return filed is
considered demand
*in cases of claim for refund, there must
be:
1. Written claim for refund in writing
2. Filed within 2 years from payment
3. There must be categorical demand
as provided in the Sec 204
- there is no 180 days. The taxpayer
must go to court
* Sec 58 (d) there is over withholding. Its
difference with 204, it
- in case of income tax return is to be
reckoned at the actual filing of the ITR
*if the taxpayer filed the return late. The
deadline or the late actual filing?
- the 2 year prescriptive period is
counted from.... NEED ANSWER NEXT
WEEK
* Zero Rated sales
- VAT registered taxpayer
- subject to VAT, but the rate is Zero.
- the sales are made outside of the
Philippines (export sales). MUST be duly
accounted for by the BSP
1. VAT is a consumption tax.
These were consumed by foreign
2. The proceeds were made in
foreign currency
- claim for refund pertains to input tax
attributable to such sales.
*transitional input tax
-it is input tax granted to business in
transition. It is a certain amount of rate
- TCC CANNOT apply to transitional
input tax
*claim for refund of creditable input tax
are only those attributable to zero rated
sales.
* RA 9337 - july 5, 2005. Deleted those
other input tax that can be refunded.
*claim for refund of input tax : 2 years
from close of the taxable quarter when
sales were made -
* 120 days - 30 days is jurisdictional to
file with CTA. If period lapses, court
should dismiss for lack of jurisdiction.
Exception:
1. Premature filing allowed until
October 6, 2010 only (because of Aichi
case)
NEXT Meeting:
1. Jurisdiction of CTA

February 18, 2017
RA 9282 march 30, 2004
Sec 7. Jurisdiction of the CTA
Sec 9.
Sec 11
What is the difference between ra 1125
and 9282
Ra 1125 (appellate juris)
In 9262 (both original and appellate)
Original - the power of the court to take
recognizance of the case instituted for
judicial action for the first time.
Read!!!! Jamani vs Lepanto 154193 2005
- since the case to the RTC is under its
original jurisdiction, the appeal should
have been under Rule 41 and NOT rule 42
* Grecia_Cuerdo
What are cases NOT under the jurisdiction
of the CTA in its appeallate jurisdiction?
1. cases under the jurisdiction of
CBAA - pertains to real property taxes
(decided in cta en banc directly. Not in the
division)
2. RTC in the exercise of its appellate
jurisdiction
*AM No. 05-11-07 CTA en banc and
division-
All the 8 cases can be reduced to 2
(all cases brought to cta en banc from
decision of the cta divisions plus, the 2
cases above)
* it is NOT MANDATORY to first file a
case for motion for reconsideration or new
trial over the cases decided by the cta
division BEFORE going to the CTA En
Banc (provided under sec 11 of RA 9282)
*failure to obey summons if filed with the
MTC
* a motion for new trial, motion for
reconsideration is considered abandoned if
the party elevates the case to the higher
court.
*Procedure
*cases from MTC to RTC is under
Rule 40 under its APPELLATE
Jurisdiction
* from RTC to CTA En Banc under
Rule 43 (within 30 days under RA 9282
sec 9, not the 15 days as provided
under the ROC)
*from the CTA Division to the CTA
En Banc under Rule 42 (also provided
under RA 9282 sec 9)
*CTA En Banc to SC under Rule 45
GR 175723 City of Manila VS
*General Rule:
The collection of taxes cannot be
enjoined.
Exception: Only the CTA can enjoin
collection of taxes on the ground when the
continuance of the collection can
jeopardize the interest of government and
the taxpayer
* Interlocutory orders of the RTC under
RA 9282 under the CTA gyapon
GR 274429 feb 18, 2014 Smart VS
Batangas
- since ordinance is not imposing
taxes in the exercise of the LGUs revenue
raising powers, it is NOT under the CTA
jurisdiction. IF the ordinance is imposing
taxes under the LGUs exercise of its
revenue raising powers, such is under the
jurisdiction of the CTA.