Professional Documents
Culture Documents
Lecture On Remedies
Lecture On Remedies
Lecture On Remedies
Remedies (part 1)
Administrative remedies
Protest against assessment
Compromise
Redemption of property after sale at public auction
Judicial Remedies
Ordinary Civil action
Filing of Petition before the CTA
Remedies of the
government
Administrative Remedies
Judicial Remedies
File civil or criminal case
Assessment
An assessment contains not only a computation of
Kinds of assessments
Self assessment
Deficiency assessment
Jeopardy assessment
Disputed assessment
Tax Delinquency
failure to pay the tax due on any return required to be
When is an assessment
made
Section 203 and Section 222 of the NIRC
Provide for a statute of limitation on the assessment
and collection of internal revenue taxes in order to
safe guard the interest of the taxpayer against
unreasonable investigation
Meaning of unreasonable investigation
Law on prescription a remedial measure
The law on prescription being a remedial measure
Rule on Prescription
When the tax law itself is silent on prescription or
when return is not required to be filed the tax is
imprescriptible
Reckoning period
The 3 year period shall be counted after the last day
prescribed by law for the filing of the return, and no
proceeding in court without assessment for the
collection of such taxes shall be begun after the
expiration of such period
Extension of Period to
Assess
Only upon written agreement between the CIR and
Suspension of Running of
Statute of Limitations
1. When the CIR is prohibited from making the
Requisites for a
Assessment
the taxpayer shall be informed in writing of the law
and the facts on which the assessment is made
Ungab vs Cusi
In Ungab v. Cusi, the Supreme Court held that an
assessment of a deficiency is not necessary to a
criminal prosecution for willful attempt to defeat
and evade the income tax.
Rule on Receipt of
Assessment
an assessment is deemed to have been made within the threeyear prescriptive period if notice to that effect was released,
mailed, or sent by the CIR to the taxpayer within said period.
Extension of Period to
Assess
Only upon written agreement between the CIR and
Suspension of Running of
Statute of Limitations
1. When the CIR is prohibited from making the assessment or
Assessment Process
Tax Audit
In a tax audit , revenue officers examine the books of account
3 years
3 years
5 years
Last day to collect either by:
[a] Summary proceedings; or
[b] Judicial proceedings
* (NIRC Section 222 (d))
10 years
10 years
Last day to
assess
5 years
Last day to collect either by:
[a] Summary proceedings; or
[b] Judicial procedings
* (NIRC, Section 222 (c))
15 days
Appeal to CTA
60 days
30 days
Decision of CTA
Div.
Decision of CTA
Div.
Decision of en banc
Appeal to
SC
Appeal to
CTA
en banc
Motion for
Recon.
A
180 days
30 days
*(NIRC,
*(NIRC,
Section 228 (e) Section 228 (e)
& RR 18-2013 & RR 18-2013
Section 2))
Section 2))
15 days
*(A.M.
No. 05-1107-CTA,
Rule 8, Sec.
3 (b))
15 days
*(A.M.
No. 05-1107-CTA,
Rule 8,
Sec. 3 (c))
15 days
*Rules of
Court,
Rule 45)
A
15 days
Decision of the BIR
60 days
30 days
Decision of CTA
Div.
Decision of CTA
Div.
Decision of en banc
Appeal to
SC
Appeal to
CTA
en banc
Motion for
Recon.
A
Appeal to CTA
15 days
*(A.M.
No. 05-1107-CTA,
Rule 8, Sec.
3 (b))
Lecture notes Tax 1 (2015-16) Associate Dean L.K. GRUBA
30 days
*(NIRC,
Section 228 (e)
& RR 18-2013
Section 2))
15 days
*(A.M.
No. 05-1107-CTA,
Rule 8,
Sec. 3 (c))
15 days
*Rules of
Court,
Rule 45)
Penalty : 25%
Failure to file any return and pay tax on the date prescribed
Wrong filing of the return
Failure to pay deficiency tax with in the time prescribed for the payment in the notice
of assessment
Penalty 50%
Willful neglect to file the return within the period prescribed
False or fraudulent return is willfully made,
Interest
Compromise penalties
filed by the taxpayer on the prescribed date was not paid at all
or was only partially paid, or (b) the deficiency taxes assessed
by the BIR become final and executory.- can be collected
immediately by issuance of a warrant; collection by
administrative remedy or through the regular court.
Compromise
Cases which maybe compromised
Delinquent accounts
Cases under Administrative protest after issuance of
the FAN
Civil tax cases being disputed before the courts
Collection cases filed in courts; and
Criminal violations, other than those already filed in
court or those involving tax fraud.
EXCEPTIONS:
1. Withholding tax cases, unless the applicant-taxpayer invokes provisions of law that
cast doubt on the taxpayers obligation to withhold;
2. Criminal tax fraud cases confirmed as such by the Commissioner of Internal Revenue
or his duly authorized representative;
3. Criminal violations already filed in court;
4. Delinquent accounts with duly approved schedule of installment payments;
resulting to reduction in the original assessment and the taxpayer is agreeable to such
decision by signing the required agreement form for the purpose. On the other hand,
other protested cases shall be handled by the Regional Evaluation Board (REB) or the
National Evaluation Board (NEB) on a case to case basis;
6. Cases which become final and executory after final judgment of a court, where
7. Estate tax cases where compromise is requested on the ground of financial incapacity
of the taxpayer.
1. Doubtful validity of the assessment. - The offer to compromise a delinquent account or disputed
assessment under these Regulations on the ground of reasonable doubt as to the validity of the
assessment may be accepted when it is shown that:
assessment is one resulting from a jeopardy assessment (For this purpose, jeopardy assessment
shall refer to a tax assessment which was assessed without the benefit of complete or partial audit by
an authorized revenue officer, who has reason to believe that the assessment and collection of a
deficiency tax will be jeopardized by delay because of the taxpayers failure to comply with the audit
and investigation requirements to present his books of accounts and/or pertinent records, or to
substantiate all or any of the deductions, exemptions, or credits claimed in his return); or
(b) The assessment seems to be arbitrary in nature, appearing to be based on presumptions and there
is reason to believe that it is lacking in legal and/or factual basis; or
(c) The taxpayer failed to file an administrative protest on account of the alleged failure to receive
notice of assessment and there is reason to believe that the assessment is lacking in legal and/or
factual basis; or
(d) The taxpayer failed to file a request for reinvestigation/reconsideration within 30 days from receipt
of final assessment notice and there is reason to believe that the assessment is lacking in legal and/or
factual basis; or
The taxpayer failed to elevate to the Court of Tax Appeals (CTA) an adverse decision of
the Commissioner, or his authorized representative, in some cases, within 30 days from
receipt thereof and there is reason to believe that the assessment is lacking in legal and/
or factual basis; or
(f) The assessments were issued on or after January 1, 1998, where the demand notice
allegedly failed to comply with the formalities prescribed under Sec. 228 of the National
Internal Revenue Code of 1997; or (g) Assessments made based on the Best Evidence
Obtainable Rule and there is reason to believe that the same can be disputed by
sufficient and competent evidence; or
(h) The assessment was issued within the prescriptive period for assessment as
extended by the taxpayers execution of Waiver of the Statute of Limitations the validity
or authenticity of which is being questioned or at issue and there is strong reason to
believe and evidence to prove that it is not authentic; or
(i) The assessment is based on an issue where a court of competent jurisdiction made an
adverse decision against the Bureau, but for which the Supreme Court has not decided
upon with finality.
(b) The taxpayer, as reflected in its latest Balance Sheet supposed to be filed with the
(c) The taxpayer is suffering from a networth deficit (total liabilities exceed total assets)
computed by deducting total liabilities (net of deferred credits and amounts payable to
stockholders/owners reflected as liabilities, except business- related transactions) from
total assets (net
Abatement
The diminution or decrease in the amount of tax
I
Instances when the CIR may
abate or cancel tax liability
The tax or any portion thereof appears to be
unjustly or excessively assessed; or
Reinvestigation vs
Reconsideration
Reinvestigation a plea for re-evaluation of an
Reinvestigation vs
Reconsideration
The main difference is in the records or evidence to
be examined by internal revenue officers, whether
there are existing records or newly discovered or
additional evidence.