PART TWO: TAXATION LAW c) Tests in Determining Whether Income is Earned for Tax

I. Purposes
General Principles (1) Realization Test
A. Power of Taxation as Distinguished from Police Power and Eminent (2) Economic Benefit Test, Doctrine of Proprietary
Domain Interest
B. Inherent and Constitutional Limitations of Taxation (3) Severance Test
Page 8 of 13C. Requisites of a Valid Tax d) Tax-Free Exchanges
D. Tax as Distinguished from Other Forms of Exactions e) Situs of Income Taxation
E. Kinds of Taxes 3. Gross Income
F. Doctrines in Taxation a) Definition
1. Construction and Interpretation of Tax Laws, Rules, and b) Concept of Income from Whatever Source Derived
Regulations c) Gross Income vs. Net Income vs. Taxable Income
2. Prospectivity of Tax Laws d) Sources of Income Subject to Tax
3. Imprescriptibility of Taxes Page 9 of 13(1) Compensation Income
4. Double Taxation (2) Fringe Benefits
5. Escape from Taxation (3) Professional Income
a) Shifting of Tax Burden (4) Income from Business
b) Tax Avoidance (5) Income from Dealings in Property
c) Tax Evasion (6) Passive Investment Income
6. Exemption from Taxation (7) Annuities, Proceeds from Life Insurance or Other
7. Equitable Recoupment Types of Insurance
8. Prohibition on Compensation and Set-Off (8) Prizes and Awards
9. Compromise and Tax Amnesty (9) Pensions, Retirement Benefit or Separation Pay
II. (10) Income from Any Source
National Taxation e) Exclusions
A. Taxing Authority (1) Taxpayers Who May Avail
1. Jurisdiction, Power, and Functions of the Commissioner of (2) Distinguished from Deductions and Tax Credits
Internal Revenue 4. Deductions from Gross Income
a) Interpreting Tax Laws and Deciding Tax Cases a) Concept as Return of Capital
b) Non-Retroactivity of Rulings b) Itemized Deductions vs. Optional Standard Deduction
2. Rule-Making Authority of the Secretary of Finance c) Items Not Deductible
B. Income Tax 5. Income Tax on Individuals
1. Definition, Nature, and General Principles a) Resident Citizens, Non-Resident Citizens, and Resident
a) Criteria in Imposing Philippine Income Tax Aliens
b) Types of Philippine Income Taxes (1) Inclusions
c) Taxable Period and
d) Kinds of Taxpayers Exclusions
2. Income for
a) Definition and Nature Taxation
b) When Income is Taxable on
Hannah Cris A. Echavez 2023 Bar Syllabus for Taxation Page 1 of 3
Compensation Income 2. Impact and Incidence of Tax
(2) Taxation of Business Income/Income from Practice 3. Destination Principle and Cross-Border Doctrine
of Profession 4. Imposition of VAT on Transfer of Goods by Tax Exempt Persons
(3) Taxation of Passive Income 5. Transactions Deemed Sale Subject to VAT
(4) Taxation of Capital Gains 6. Zero-Rated and Effectively Zero-Rated Sales of Goods or
(5) Capital Asset vs. Ordinary Asset Properties
b) Income Tax on Non-Resident Aliens Engaged in Trade or 7. VAT-Exempt Transactions
Business 8. Input and Output Tax
c) Income Tax on Non-Resident Aliens Not Engaged in Trade 9. Tax Refund or Tax Credit
or Business 10. Filing of Returns and Payment
d) Individual Taxpayers Exempt from Income Tax D. Tax Remedies Under the National Internal Revenue
(1) Senior Citizens 1. Assessment of Internal Revenue Taxes
(2) Minimum Wage Earners a) Procedural Due Process in Tax Assessments
(3) Exemptions b) Requisites of a Valid Assessment
Granted c) Tax Delinquency vs. Tax Deficiency
Under d) Prescriptive Period for Assessment
International (1) False Returns vs. Fraudulent Returns vs. Non-Filing
Agreements of Returns
6. Income Tax on Corporations (2) Suspension of the Running of Statute of Limitations
a) Income Tax on Domestic Corporations and Resident 2. Taxpayer’s Remedies
Foreign Corporations a) Protesting an Assessment
(1) Branch Profit Remittance Tax (1) Period to File Protest
(2) Itemized (2) Submission of Supporting Documents
Deductions (3) Effect of Failure to File Protest
vs. (4) Action of the Commissioner on the Protest Filed
Optional b) Compromise and Abatement of Taxes
Standard c) Recovery of Tax Erroneously or Illegally Collected
Deductions 3. Government Remedies for Collection of Delinquent Taxes
b) Income Tax on Non-Resident Foreign Corporations a) Requisites
c) Income Tax on Special Corporations b) Prescriptive Periods
d) Exemptions from Tax on Corporations 4. Civil Penalties
e) Period Within Which to File Income Tax Return of a) Delinquency Interest and Deficiency Interest
Individuals and Corporations b) Surcharge
Page 10 of 13f) Substituted Filing c) Compromise Penalty
g) Failure to File Returns III.
7. Withholding Taxes Local Taxation
a) Concept A. Local Government Taxation
b) Creditable vs. Withholding Taxes 1. General Principles
C. Value-Added Tax (VAT) 2. Nature and Source of Taxing Power
1. Concept and Elements of VATable Transactions Page 11 of 13a) Grant of Local Taxing Power Under the Local Government

Hannah Cris A. Echavez 2023 Bar Syllabus for Taxation Page 2 of 3

Code Judicial Remedies
b) Authority to Prescribe Penalties for Tax Violations A. Court of Tax Appeals (CTA)
c) Authority to Grant Local Tax Exemptions 1. Exclusive Original and Appellate Jurisdiction Over Civil Cases
d) Withdrawal of Exemptions 2. Exclusive Original and Appellate Jurisdiction Over Criminal Cases
3. Scope of Taxing Power B. Procedures
4. Specific Taxing Power of Local Government Units 1. Filing of an Action for Collection of Taxes
5. Common Revenue Raising Powers Page 12 of 13a) Internal Revenue Taxes
6. Community Tax b) Local Taxes
7. Common Limitations on the Taxing Powers of Local Government 2. Civil Cases
Units a) Who May Appeal, Mode of Appeal, and Effect of Appeal
8. Requirements for a Valid Tax Ordinance b) Suspension of Collection of Taxes
9. Taxpayer's Remedies c) Injunction Not Available to Restrain Collection
a) Protest 3. Criminal Cases
b) Refund a) Institution and Prosecution of Criminal Action
c) Action before the Secretary of Justice b) Institution of Civil Action in Criminal Action
10. Assessment and Collection of Local Taxes c) Period to Appeal
a) Remedies of Local Government Units 4. Appeal to the CTA En Banc
b) Prescriptive Period 5. Petition for Review on Certiorari to the SC
B. Real Property Taxation —--------------------------------------NOTHING FOLLOWS—--------------------------------------
1. Fundamental Principles
2. Nature
3. Imposition
a) Power to Levy
b) Exemption from Real Property Tax
4. Appraisal and Assessment
a) Classes of Real Property
b) Assessment Based on Actual Use
5. Collection
a) Date of Accrual
b) Periods to Collect
c) Remedies of Local Government Units
6. Taxpayer’s Remedies
a) Contesting an Assessment
(1) Payment Under Protest; Exceptions
b) Contesting a Valuation of Property
(1) Appeal to the Local Board of Assessment Appeals
(2) Appeal to the Central Board of Assessment Appeals
(3) Effect of Payment of Taxes
c) Compromise of Real Property Tax Assessment
IV.
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