NIRC:

REMEDIES:

REFUND: Section 112 ( no element of illegality)

refund of excess input vat in zero rated transaction

specific to zero rated transaction

TRAIN LAW ( zero rated
OLD NIRC (all zero rated
transactions beginning Jan 1,
transactions until 31 Dec 2017)
2018)

TX files the claim for refund within TX files the claim for refund within
step 1 ( administrative 2 years from close of quarter 2 years from close of quarter
claim for refund) when you had the zero rated when you had the zero rated
transaction transaction
BIR: G, D, NON-ACTION BIR: G / DENY

Granted: TX smiles ( end of Granted: TX smiles ( end of

process; refund approved) process; refund approved)

Denied: TX cries; Denied: TX cries;

NO NON-ACTION UNDER THE

step 2
BIR NON-ACTION: BIR does not
act on the claim for refund within
120 days from submission of the
refund; if additional documents
are submitted by TX, count 120
day period from submission of
complete documents;
TRAIN LAW; BIR is required to
issue a decision within NINETY
(90) DAYS FROM SUBMISSION OF
COMPLETE DOCUMENTS IN
SUPPORT OF THE CLAIM FOR
REFUND; Under train Law, if BIR
does not act, BIR will file
administrative case against its
personnel; Under the Internal
Rules of CTA, file an appeal to CTA
DIV within 30 days from
expiration of 90 day period;
 if denied: TX goes to CTA WITHIN
30 DAYS FROM RECEIPT OF
PREJUDICIAL DECISION. THEN
PROCEED TO CTA EB (15 days) , SC
( 15 days)
step 3 ( judicial claim for
refund)
if denied: TX goes to CTA WITHIN
30 DAYS FROM RECEIPT OF
PREJUDICIAL DECISION. THEN
PROCEED TO CTA EB (15 days) , SC
( 15 days)

IF NON-ACTION BY THE BIR: TX

GOES TO CTA DIV WITHIN 30 DAYS
FROM EXPIRATION OF 120 DAY
PERIOD; THEN CTA EB ( 15 DAYS)
AND SC (15 DAYS)

NOTE: when TX goes to CTA ( judicial claim for refund); doctrine of exhaustion of admin
with the requirement to file MR/MNT from decision of CTA DIV before goin
 Section 229

regular refund procedures; Illegally

assessed/illegally collected/ erroneously
assessed/erroneously collected

all internal revenue taxes

no distinction between OLD NIRC and TRAIN

LAW

TX files the claim for refund within TWO (2)

YEARS from payment;

BIR: G/DENY

Granted: TX smiles ( end of process; refund

approved)

Denied: TX cries;

NO NON-ACTION
 IF DENIED: TX GOES TO CTA WITHIN 30 DAYS
FROM RECEIPT OF PREJUDICIAL DECISION,
PROVIDED THAT THE JUDICIAL CLAIM FOR
REFUND IS FILED WITHIN THE SAME TWO (2)
YEAR PERIOD FROM PAYMENT)

ctrine of exhaustion of administrative remedies; comply

cision of CTA DIV before going up to CTA EB);

NOTE: IN SECTION 229, BOTH THE

ADMNISTRATIVE AND JUDICIAL CLAIMS FOR
REFUND MUST BE FILED WITHIN THE SAME
TWO YEAR PERIOD FROM PAYMENT OF TAX;
 REMEDIES:
PRESCRIPTIVE PERIODS UNDER THE NIRC:
ASSESSMENT

1. LOA ( validity of LOA is 120 days);

2. TX REQUIRED TO SUBMIT DOCUMENTS
( SDC/AD)
3. BIR NOTICE OF DISCREPANCY (NOD)

REQUIRED 4. TX IS GIVEN 15 DAYS FROM RECEIPT OF NOD

PROCEDURES FOR TO FILE REPLY;
ISSUANCE OF FAN 5. W/ OR W/OUR REPLY TO NOD, BIR ISSUES
PAN;
6. TX IS GIVEN 15 DAYS TO FILE COMMENT ON
PAN;
7. W/ OR W/OUR COMMENT/REPLY, BIR ISSUES
FINAL ASSESSMENT NOTICE (FAN)

If TX files return in good faith:

1. if filed before due date: 3 yrs from due date

2. if filed exactly on due date: 3 yrs from due
date;
3. if filed beyond due date: 3 yrs from date of
actual filing;
PERIODS OF A: NO 1
if TX files FR/FR:
BIR issues FAN within TEN (10) YEARS from
BIR discovery of filing FR/FR

if TX did not file any return:

BIR issues FAN within TEN (10) YEARS from
BIR discovery of non-filing;

if a valid waiver is executed bet BIR and TX:

1. in writing;
2. executed prior to expiration of original period
of A;

3. indicating date of signing by BIR & TX;

4. indicating the date of receipt of the waiver by

the TX;
5. three (3) original copies ( TX,BIR, & records of
the case);
6. with specific period of expiration;
 REMEDIES:
UNDER THE NIRC:
COLLECTION MANNER OF COLLECTION

5 YEARS FROM COLLECTION BY

RECEIPT BY TX OF THE WAY OF
FAN issued by BIR ADMINISTRATIVE OR
within the prescriptive JUDICIAL MODES OF
periods of Assessment COLLECTION

MANNER OF COLLECTION
COLLECTION WITHOUT ASSESSMENT

if TX files FR/FR:

BIR issues FAN within TEN (10) YEARS from

BIR discovery of filing FR/FR COLLECTION BY WAY OF
JUDICIAL MODES OF
COLLECTION
 COLLECTION BY WAY OF
JUDICIAL MODES OF
COLLECTION
if TX did not file any return:
BIR issues FAN within TEN (10) YEARS from
BIR discovery of non-filing;
 PROTEST CASES: ADMINIS
ADMINISTRATIVE PORTION
TX BIR TX

RETURN Issue Assessment (FAN) PROTEST

prescriptive periods of administrative in

( DUE DATES)
assessment nature;

GF 3 in writing;

RDO that issued the

FR/FR 10
FAN

filed within 30 days

NO RETURN FILED 10 from receipt of the
FAN
OTEST CASES: ADMINISTRATIVE PROTEST
JUDICIAL PORTION
BIR TX CTA DIV

SMILES ( END OF
GRANT DEAD PROCESS GRANT
PROCESS)

CTA DIVISION ( 30 DAYS

DENY CRIES FROM RECEIPT OF BIR DENY
DECISION DENYING PROTEST

TX MAY FILE PET REV

NON-ACTION ( 180 BEFORE THE CTA DIV
PARTLY
days from filing of POKER FACE ( within 30 days from GRANT/DENY
protest) expiration of 180 day
period)

CTA DIVISION ( 30 DAYS

FROM RECEIPT OF BIR
HALF SMILING/HALF
PARTLY GRANT/DENY DECISION APRTLY
CRYING
GRANTING/DENYING
PROTEST)
JUDICIAL PORTION
SUPREME
TX BIR CTA DIV CTA EB
COURT

SMILES CRYING

15 DAYS FROM
RECREIPT OF
CRIES SMILING FILE MR/MNT 15 DAYS FROM PREJDUICIAL
WITHIN 15 DAYS RECREIPT OF DECISION
FROM RECRIPT PREJDUICIAL ( PETITION FOR
OF PREJUDICIAL DECISION
REVIEW ON
DECISION CERTIORARI)
HALF HALF
SMILING/HALF SMILING/HALF
CRYING CRYING
n 4 of NIRC: Power of the CIR to interpret Tax Laws/DECIDE CASES
TX DOF
provisions of Tax Code NIRC DENIED
all tax laws administered by the BIR Tax Amnesty Laws GRANT
SEC OF FINANCE PARTLY
APPEAL WITHIN DENIED/GR
30 days from ANT
CIR may issue RR/RMC/RMO issuance of
prejudicial
CIR may also issue specific rulings interpretation
( pertaining to a taxpayer)
CIR may also issue opinions
( pertating to a TX)
 TX
CTA
END OF PROCESS

CTA
 VALUE ADDED TAX:

1 indirect tax which passed on and on and on

VAT paid on
output tax
sales (OS)
2
VAT paid on
input tax
purchases (IP)

12%

input vat is
allowed to be
0%
credited against
output vat
3 rates of VAT
effectively zero
rated
input vat is NOT
ALLOWED to be
exempt
credited against
output vat

TRANSACTIONS
4 DEEMED SALE ( TDS):
sale of goods

109 of tax code ( A

5 to CC) exempt from
vat transactions

section 112 vs sec

6 refund
229 of the tax code
 INCOME TAX AND GENERAL PRINCIPLES
exemption of nsnp educational institution DLSU Case

1 exemption of religious institution

exemption of charitable institution

within Phils or without the Philippines ( Sec 42 of the

tax code)
taxability for purposes of income tax is dependent on
the source of income ( within/without Phils)
2 source of income

among 8 kinds of TX, only a resident citizen and

domestic corp are subject to income tax for income
within and without; the 7 types of TX are subject to
income tax for income within only;
Section 39 of tax code
3 capital asset vs ordinary asset
capital asset ( hindi ginagamit sa trade or business)
ordinary asset ( ginagamit sa trade or business)
capital gains tax on sale of real property 6% of the FMV, GSP, ZV whichever is the highest;
4
located in the Philippines
memorize requisites for exemption from CGT of 6%
lahat ng INCOME taxable unless exempted or excluded from computation of gross income
5 exempted: no tax
excluded: section 32 (B) no income tax; are in the nature of exemption, strictly construed against
TX
deductions: effect is reduce the tax due; therefore treated as exemptions strictly construed against
TX
expenditures of TX
CIE: no deductions allowed
engaged in trade or business: business related expenditures are allowed as deductions;
requisites for deductibility of TX expenses:
1. necessary in trade or business;
2. actually paid or incurred;
3.reasonable in amount;
if capital expenditure: not allowed as deduction but instead claim for depreciation of asset;
6 ( Section 34
of tax code)
6 ( Section 34
of tax code) personal and living expenses (not deductible)
expenses for major repairs ( not deductible)
premium on life insurance taken by the employer over the life of employee and deisgnating as
beneficiary, employeror his business ( not deductible)

charitable and other contributions:

donate in favor of gov't: if priority project of gov't, deductible 100%
if not priority project of gov't: 5 % and 10% of the taxable income prior to this deduction

donate in favor of religious, charitable, educatioal institution: deduction is up to 5% or 10% of the

taxble income prior to this deduction
NERAL PRINCIPLES
revenues ( kita) ADE used for educ
purpose: exempt from tax
assets (ADE) used for educ purpose:
exempt from tax

Section 30 of tax code: income "AS

SUCH" is exempt, but income from
activity conducted for profit/ real
property regardless of disposition, not
exempt from income tax

thin Phils or without the Philippines ( Sec 42 of the

tax code)
xability for purposes of income tax is dependent on
the source of income ( within/without Phils)

among 8 kinds of TX, only a resident citizen and

omestic corp are subject to income tax for income
thin and without; the 7 types of TX are subject to
income tax for income within only;
Section 39 of tax code

apital asset ( hindi ginagamit sa trade or business)

ordinary asset ( ginagamit sa trade or business)
6% of the FMV, GSP, ZV whichever is the highest;
emorize requisites for exemption from CGT of 6%
or excluded from computation of gross income
he nature of exemption, strictly construed against
TX
re treated as exemptions strictly construed against

ated expenditures are allowed as deductions;

trade or business;
aid or incurred;
ble in amount;
but instead claim for depreciation of asset;
oyer over the life of employee and deisgnating as
his business ( not deductible)

ther contributions:
't, deductible 100%
e taxable income prior to this deduction

al institution: deduction is up to 5% or 10% of the