LA SALLE UNIVERSITY

College of Business and Accountancy

Second Semester 2023-2024

INTEGRATED ACCOUNTING THEORIES AND PRACTICE

TAXATION
May 24, 2024

1. Given the following actions of a revenue officer b. The BIR has no more remedies since the right of the
during Discussion on Discrepancy and prior to the government to file an action had already been
issuance of a Preliminary Assessment Notice. prescribed.
I. Discussion on Discrepancy. c. The BIR must and the assessment notice before
II. Taxpayer receives Notice of Discrepancy September 10, 2023.
III. Revenue Officer prepares a report of examination d. The BIR must and the assessment notice before
based on the results of meeting with taxpayer, after March 5, 2030.
considering factual and legal explanations of
taxpayer. 7. The amount of tax still due (net of withholding tax of
The above actions are arranged chronogically as P 20,000) in the 2022 tax return of Early is P 3,560.
follows: She paid the said amount upon filing the return. On
a. III,I,II c. II,I,III May 12, 2024, she filed an amended the return which
b. I, III, II d. I,II,III is not substantially different from the original. If the
last day for the BIR to make an assessment is April
2. Which among the following circumstances negates 15,2026, the original return must have been filed by
the prima facie presumption of correctness of a BIR Early on-
assessment? a. May 12, 2023 c. July 15, 2023
a. The BIR assessment was seasonably protested within b. June 14, 2023 d. April 8, 2023
30 days from receipt.
b. No preliminary assessment notice was issued prior to 8. Cosa filed a fraudulent income tax return for the year
the assessment notice. 2021 on April 11,2022. The Bureau of Internal
c. Proof that the assessment is utterly without Revenue (BIR) discovered the fraud on February 20,
foundation, arbitrary, and capricious. 2023. The last day for the BIR to collect or to send an
d. The BIR did not include a formal letter of demand to assessment notice is
pay the alleged deficiency. a. April 11, 2025 c. April 15, 2032
b. April 15, 2025` d. February 20,
3. Before a Final Assessment Notice (FAN) is issued, 2023
the taxpayer is required to respond to the Preliminary
Assessment Notice within a period of 9. The running of the prescriptive period for assessment
a. 30 days c. 45 days is not suspended.
b. 15 days d. 6 months a. When the taxpayer files a Request for
Reinvestigation which is granted by the
4. Anthonknia filed her 2020 Income Tax Return and Commissioner of Internal Revenue
paid the tax due thereon on April 1, 2021. In case of b. When the taxpayer is out of the Philippines
deficiency, the last day for the Bureau of Internal c. When the warrant of distraint has been duly served
Revenue to send a Final Assessment Notice (FAN) is upon the taxpayer and no property could be located.
a. April 1, 2024 c. April 15, 2024 d. If the taxpayer informs the Commissioner of any
b. April 15, 2025 d. April 15, 2031 change in address.

5. The income tax payable ( net of withholding tax of P 10. Assuming that the taxpayer submitted the documents
29,500) in the 2022 tax return of Lito is P 3,950. He supporting his motion on August 26, 2024. The
filed the return on April 8, 2023. Assuming he paid Bureau of Internal Revenue should act on the protest
the balance in the tax return on June 28, 2023, the last not later than-
day for the BIR to make an assessment is- a. September 26, 2024 c. February 26,
a. June 28, 2026 c. July 15, 2026 2024
b. April 15, 2026 d. April 8, 2026 b. April 15, 2025 d. February 22,
2025
6. On March 5, 2020, the BIR discovered a deficiency
value-added tax for the quarter ended September 11. If in August 4, 2024 the taxpayer filed a Request for
2013. The deficiency did not arise from error or Reconsideration instead of Request for
fraud. Which of the following statements is correct? Reinvestigation, the supporting documents should be
a. The BIR must send the assessment notice before submitted to the BIR not later than
March 5, 2023
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a. October 4, 2024 c. October 3,
2024
b. October 2, 2024 d. No documents
to be submitted.
12. The taxpayer seasonably filed his protest together
with all the supporting documents. It is already July
31, 2022, or 180 days from submission of the protest
but the BIR Commissioner has not yet decided his
protest. Desirous of an early resolution of his
protested assessment, the taxpayer should file his
appeal to the Court of Tax Appeals not later than
a. August 31, 2022 c. August 15,
2022
b. August 30, 2022 d. August 1, 2022
Items 13 and 14
13. On March 30, 2022 Miguel Foods, Inc. received a
notice of assessment and a letter of demand on its
April 15, 2020 final adjustment return from the BIR.
Miguel Foods then filed a Request for
Reinvestigation together with the requisite supporting
documents on April 25, 2022. On June 2, 2022, the
BIR issued a final assessment reducing the amount of
the tax demanded. Since Miguel Foods was satisfied
with the reduction, it did not do anything anymore.
On April 15, 2027 the BIR garnished the
corporation’s bank deposits to answer for the tax
liability. Was the BIR action proper?
A. Yes. The BIR has 5 years from the filing of the
protest within which to collect.
B. Yes. The BIR has 5 years from the issuance of the
final assessment within which to collect.
C. No. The taxpayer did not apply for a compromise.
D. No. Without the taxpayer’s prior authority, the BIR
action violated the Bank Deposit Secrecy Law.
14. Assuming that the BIR did not act on the protest, the
last day for the taxpayer to appeal to the Court of Tax
appeals on the inaction is-
a. October 22, 2022 c. November 21,
2022
b. October 21, 2022 d. November 22,
2022
15. Statement 1: The filing of quarterly income tax
returns and payment of quarterly income tax by
corporations are mere installments and therefore, not
the basis in computing the two-year prescriptive
period for refund.
Statement 2: If the tax has been withheld from source
(withholding on wages), the prescriptive period for
refund is counted from the date it falls due at the end
of the taxable year.
a. True, False c. False, False
b. False, True d. True, True
16. Date of tax erroneously paid
June 10, 2023
Date of claim for refund was filed with BIR
March 3, 2025
Date of BIR decision of denial was received
April 5, 2025
Last day to appeal to the Court of Tax Appeals is
a. June 5, 2025 c. June 10, 2025
b. March 3, 2025 d. May 5, 2025
17. Miss de Vera paid excessive tax on April 15, 2020.
On December 20, 2021 she filed a written claim for
refund. Her claim was denied by the BIR and she
received the denial on March 20, 2022. Miss de Vera
filed a motion for reconsideration with the BIR on
March 31, 2022. On April 18, 2022. She received the
final denial of the BIR. |What will be the taxpayer’s
remedy?
a. File another motion for reconsideration with the BIR
within 30 days after the receipt of the final denial.
b. File an appeal with the CTA within 30 days after the
receipt of the final denial.
c. File an appeal with the CTA within 15 days after the
receipt of the final denial.
d. The taxpayer has no more remedy against the final
denial.
18. Which of the following statements is FALSE? A zero-
rated VAT taxpayer files a claim for refund on input
tax-
a. The claim must be filed anytime within two years
after the close of the taxable quarter when the sales
were made.
b. If the claim is denied by the BIR, the taxpayer can
appeal only within the 2-year period from the close of
the taxable year.
c. The CIR shall grant a refund or issue a tax credit
certificate within 90 days from the date of submission
of complete documents in support of the application
filed.
d. In case the claim is denied by the CIR, the taxpayer
can file an appeal with the Court of Tax Appeals
within 30 days from receipt of the decision, even if it
is beyond the 2-year period.
19. Which of the following is not an extrajudicial remedy
of the government against the taxpayer?
a. Distraint of personal property c. Garnishment of
bank accounts
b. Levy of real property d. Filing of
criminal case in court
20. The actual effort exerted by the government to effect
the exaction of what is due from the taxpayer is
known as
a. Assessment c. payment
b. Levy d. collection
21. When a BIR decision affirming an assessment is
appealed to the CTA, the BIR’s power to garnish the
taxpayer’s bank deposits
a. Is suspended to await the finality of such decision.
b. Is suspended given that the CTA can reverse BIR
decisions when prejudicial to the taxpayer.
c. Is not suspended because only final decisions of the
BIR are subject to appeal.
d. Is not suspended since the continued existence of
government depends on tax revenues.
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22. The following remedies are available to the
government to collect taxes, except
a. Distraint and levy
b. Inquiring into bank deposit accounts of taxpayers
c. Entering into compromise of tax cases
d. Enforcement of forfeiture of property
23. The remedies of distraint and levy cannot be availed
of where the amount of tax involved is not more
than-
a. P 1.00 c. P 100.00
b. 10.00 d. 1,000,00
24. Which of the following violations cannot be subject
to compromise penalties?
a. Failure to keep/preserve books of accounts and
accounting records.
b. Failure to keep books of accounts or records in a
native language or English.
c. Failure to have books of accounts audited and have
financial statements attached to income tax return
certified by independent CPA.
d. Keeping two sets of books of accounts or records.
25. Which of the following statements is not true?
a. If a taxpayer is acquitted in a criminal violation of the
Tax Code, this acquittal does not exonerate him from
his civil liability to pay the taxes.
b. A conviction for tax evasion is not a bar for
collection of unpaid taxes.
c. A tax assessment is necessary to a criminal
prosecution for willful attempt to defeat and evade
payment of taxes.
d. Criminal proceedings under the Tax Code is now a
mode of collection of internal revenue taxes, fees, or
charges.
26. Cruz filed an income tax return for the calendar year
2021 on March 10, 2022. The BIR issued a
deficiency income tax assessment on April 10, 2024
which has become final. When is the last day for the
BIR to collect?
a. April 10, 2029 c. April 15, 2029
b. April 15, 2028 d. March 10, 2026
27. Which of the following criminal acts for violation of
the Tax Code is subject to both fine and
imprisonment?
a. Making false entries, records and reports or
certification.
b. Unlawful pursuit of business without paying the
privilege tax required for that business.
c. Willfull attempt to evade or defeat in any manner any
tax under the Code and willful failure to pay a tax,
make a return, supply correct and accurate
information, withhold and remit taxes withheld.
d. All of the above.
28. The books of accounts must be kept in
a. Any language depending on the preference of the
taxpayer.
b. English language only.
c. Native language or English only
d. Native language, English or Spanish
29. Which of the following does not pertain to levy of
real property?
a. If no sufficient bid is received, the government shall
forfeit the property.
b. Has the right of pre-emption and redemption.
c. Notice requirements are stickter.
d. Effected on personal property
30. What should the BIR do when the prescriptive period
for the assessment of a tax deficiency is about to
prescribe but the taxpayer has not yet complied with
the BIR requirements for the production of books of
accounts and other records to substantiate the claimed
deductions, exemptions or credits?
a. Call the taxpayer to a conference to explain the delay.
b. Immediately conduct an investigation of the
taxpayer’s activities.
c. Issue a jeopardy assessment coupled with a letter of
demand.
d. Issue a notice of constructive distraint to protect
government interest.
31. De Leaon is the Chief Accountant of ABC Publishing
Company, a publisher of magazines and periodicals.
He wants to know if a new product to be released in
the market will be covered by the provisions of the
tax code on exemptions from value added tax, thus,
requiring interpretation of the provisions of the
National Internal Revenue Code.
He should address his query to the-
a. Commissioner of Internal Revenue
b. Secretary of Justice
c. Secretary of Finance
d. Court of Tax Appeals
32. Question 1: Does the power of the Commissioner of
Internal Revenue to inquire into the bank deposits of
a taxpayer conflict with the Secrecy of Bank Deposits
Law?
Question 2: May the Commissioner of Internal
Revenue authorize an examiner to inquire into the
Bank deposits of a taxpayer who is suspected to have
committed fraud in declaring his income?
Which f the above questions is/are answerable by
“Yes”?
a. Question 1 only c. Questions 1 and 2
b. Question 2 only d. Neither Question 1 nor 2
33. A program of the BIR penalizing non-issuance of
official receipts or sales invoices and/or use of OR or
SI not duly registered with the BIR, including but not
limited to fake of spurious receipts/invoices
a. Non-issuance of Official Receipts (NO OR)
b. Rate
c. eComplaint System
d. Disiplina Program
34. Which of the following cases falls within the
jurisdiction of the Court of Tax Appeals?
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a. Criminal action for violation of the NIRC.
b. Question of whether or not to impose a deficiency tax
assessment upon a taxpayer.
c. Appeal from undisputed tax assessment.
d. Action for refund of real property tax.
35. The CTA has exclusive appellate jurisdiction to
review cases decided by the following, except
a. Commissioner of Customs
b. Central Board of Assessment Appeals
c. Regional Trial Court on local tax cases
d. Decisions of the City Board of Assessment Appeals
36. Which of the following statements is false? The
Board of Investments
a. Assist Filipino and foreign investors to venture and
prosper in desirable areas of economic activities.
b. Is tasked to promote investments, extend assistance,
register, grant incentives to and facilitate the business
operations of investors export-oriented
manufacturing and service facilities inside selected
areas throughout the country as PEZA Special
Economic Zones.
c. Is the lead government agency responsible for the
promotion of investments in the Philippines.
d. Assists Filipino and foreign investors to venture in
food processing, construction, metal products,
telecommunications, power and infrastructure
projects among others.
37. The short title of Republic Act 7916 is
a. The Special Economic Zone Act of 1995
b. The Special Economic Zone Act of 2005
c. The Philippine Economic Zone Act of 1995
d. The Export Processing Zone Authority Act of 1995
38. The appointing authority of the members of the
Board of Governors in the Board of Investments
a. President of the Philippines
b. Secretary of Trade and Industry
c. Commission on Appointments
d. Secretary of Labor
39. Listed below are transactions on real property. Which
of them does not require issuance of a Certificate
Authorizing Registration?
a. Sale of his residential house.
b. Donation inter vivos of real property.
c. Transfer mortis causa of a parcel of land.
d. Long-term lease of commercial building.
40. A closing medium size corporation with principal
office in Quezon City hired your services to work for
the registration of its closure with various
government agencies. Which of the following offices
need not be notified or sought approval of its closure?
a. Department of Labor and Employment
b. City Government of Quezon City
c. Cooperative Development Authority
d. Bureau of Internal Revenue
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