NIRC REMEDIES

REMEDIES OF THE GOVERNMENT

Basic Remedies (A.C)

1. Assesssment (CND)

-When required (impose additional taxes)

-Principles

-Kinds

1. Self

2. Illegal

3. Deficiency

4. Erroneous

5. Jeopardy

6. Disputed

-Means employed by officer in assessment

-Forms

1. FAN - serial accountable form

2. Informal written notice - computation + demand

-Process

1. Issuance of LOA - CIR + signature of RO

2. Audit or tax investigation by RDO

3. Notice of an informal conference - 15; default

4. Review of assessment by Division (RAD)/Commissioner - sufficient basis

5. Informal conference - signed

6. Issuance of PAN - from RAD; once or twice; letter of protest (reply); requisites for FAN and
letter of demand; in case of default, may still contest FAN

-EXNS (MEWER)
 7. Issuance of FAN - by Commissioner/agent; may be protested 30, and appealable to CTA

2. Collection

-Delinquency tax vs. deficiency tax

Other Classifications

A. Administrative

1. Tax Lien - nature; validity; commencement

2. Distraint of personal property or garnishment of bank deposits

A. Actual

-Procedure

a. Commencement - 1M or below - RDO

b. Service of warrant of distraint

c. Report of the distraint

d. Notice of sale of distrained properties

e. Sale at public auction

-Right of pre-emption ONLY

-Purchase by government at sale

-Distraint of intangible properties - garnishment

B. Constructive - preventive; no actual delinquency necessary

-Cases

-Procedure

-Penalty

3. Levy of real property

-Concept

-When

-Procedure
 1. Issuance of warrant of levy - certificate of levy

2. Service of warrant - mail/service to RD and TP

3. Advertisement sale

4. Public sale

5. Redemption - 1 yr from registration of the deed of sale ; to whom ; effect

6. Further distraint and levy

4. Forfeiture (of confiscated article) - no compensation; for default or offense

-vs. Seizure

-Enforcement

-Forfeited goods or articles

-When appropriate

5. Compromise - concession; avoid litigation

-What stage available

-Role of courts; CTA

-Requisites

-Approving authorities; CIR, NEB, REB - P500k or less

-Compromise penalty

-When available

1. Doubtful validity

2. FInancial incapacity

-Rule on Withholding tax

-Cases that may be compromised; NOT

-Remedy of CIR in case of refusal to pay compromise - enfocce or rescind

-Enforcement of tax compromise - execution; litigation

6. Penalties and fines - increments to basic tax; non-compliance

 -Good faith is defense

7. Suspension of business operation

-VAT-registered; understatement of taxable sales or receipts by 30%

-By CIR

-Not less than 5 days; up to compliance

8. Requiring the filing of bonds

9. Giving of rewards to informers

1. For violations of NIRC

-Amount of reward - 10% of collected penalty or 1M

-Persons disqualified - within 6th degree of con

-Requisites - sworn info; not yet in possession; leads to fraud and collection; not disq

-Persons disqualified

2. For discovery and seizure of smuggled goods

-Amount- 10% of FMV or 1M

-Subject to income tax; withheld at 10% rate

-All public officials who acquired the info in the course of the performance of his duties (retired
or not)

10. Making arrest, search, and seizure - internal revenue officers

11. Inspection and examination of books

12. Obtaining information on potential taxpayers and examination of any person regarding his tax liability

13. Inventory-taking, surveillance of business operations, and prescribing presumptive gross sales

14. Termination of tax period

15. Inquiring into bank deposits

B. Judicial

1. Civil

2. Criminal
STATUTE OF LIMITATIONS OR PRESCRIPTIVE PERIODS

REMEDIES OF TAXPAYER

I. Before payment

A. Administrative

1. Abatement of taxes

2. Protest against assessment

3. Entering into compromise

B. Judicial

II. After payment

A. Administrative

B. Judicial

REINVIGORATED RUN AFTER TAX EVADERS