BIR and Tax Remedies

Question 1

National Office of the BIR

Answer 1

1 Commissioner
4 deputy commissioners (Operations, Legal and Inspection, Information Systems, and Resource Management
13 Assistant Commissioners

Question 2

Field Offices

Answer 2

19 regional directors
124 Revenue District Offices

Question 3

Powers and Duties of the BIR

Answer 3

1. To assess and collect all national internal revenue taxes, fees, and charges;
2. to enforce all forfeitures, penalties and fines connected
3. to execute all judgments decided in its favor by the courts
4. recommend to the Secretary of Finance all needed rules and regulations for the effective enforcement of tax laws

Question 4

Exceptions to the DELEGATION of Powers and Duties of the CIR

Answer 4

1. power to recommend rules and regulations (to the secretary of finance)
2. power to issue rulings or to reverse, revoke, or modify existing rulings of the BIR
3. power to compromise or abate

Question 5

Exceptions to the exceptions of the delegation of powers of the CIR

Answer 5

1. Abate or compromise assessments issued by the regional offices involving basic deficiency taxes of P500,000 or less
2. Prosecution of minor criminal violations of the tax code
3. power to assign or reassign internal revenue officers

Question 6

First step to the assessment process

Answer 6

Self-Assessment

Question 7

an official document that empowers a Revenue Officer (RO) to examine and scrutinize a taxpayer’s books of accounts and other accounting records in order to determine the correct tax liabilities of the taxpayer

Answer 7

Letter of Authority

Question 8

Requirements of a Letter of Authority

Answer 8

1. should cover on taxable year
2. must be served to the taxpayer within 30 days from its date of issuance
3. RO is given 120 days to conduct an audit; revalidation

Question 9

After audit proper, there will be a

Answer 9

Presentation of findings; Notice of informal conference (15 days)

Question 10

If no resolution was found in the Presentation of findings; Notice of informal conference

Answer 10

there is the Issuance of a Preliminary Assessment Notice (PAN)

Question 11

the tax payer has _________ to submit a reply to the PAN

Answer 11

15 days

Question 12

If no resolution was found in the Preliminary Assessment Notice (PAN)

Answer 12

Issuance of a Final Assessment Notice (FAN) / Formal letter of Demand (FLD)

Question 13

the tax payer has _________ to submit an administrative protest to the FAN/FLD

Answer 13

30 days

Question 14

the tax payer has _________ to submit documents to support administrative protest for the FAN/FLD

Answer 14

60 days

Question 15

Failure to file a valid protest against FAN/FLD within _________

Answer 15

within 30-day period shall render the assessment final and executory

Question 16

If protest against the FAN/FLD is denied, the BIR will

Answer 16

BIR will issue a Final Decision on Disputed Assessment`

Question 17

If protest against the FAN/FLD is denied, the taxpayer can

Answer 17

1. file an appeal to the CTA within 30 days
   or
2. elevate the request for reconsideration to the CIR within 30 days

Question 18

The taxpayer can elevate from CTA to the SC or CIR to the CTA IF _____

Answer 18

If the decision of CTA or CIT is adverse to taxpayer or no decision is made within 180 days, the taxpayer can

Question 19

Claim for refund

Answer 19

when an internal revenue tax has been erroneously or illegally collected or a penalty has been imposed without authority, the taxpayer may file a claim for refund or credit within two (2) years after payment with the CIR before any case is filed in the CTA

Question 20

(tax refund) The two-year or 24-month period should be computed from the time of

Answer 20

actual filing of the adjustment return or annual income tax return

If paid in installment, the date of final payment

because at that point, it can already be determined whether or not there has been overpayment

Question 21

a legal claim or change on property established by law as a sort of security for the payment of tax obligations

Answer 21

Tax Lien

Question 22

a summary remedy whereby collection of tax is enforced upon personal property of the taxpayer

Answer 22

Distraint

Question 23

is the seizure of real property for the satisfaction of taxes due from a delinquent taxpayer

Answer 23

Levy

Question 24

the process of seizing personal property of a delinquent taxpayer that is in the possession of a third person (like a bank deposit) in order to satisfy the tax obligations of the said taxpayer

Answer 24

Garnishment

Question 25

Suspension of business operation

In case of VAT-registered persons:

Answer 25

1. Failure to issue receipts or invoices
2. Failure to file a VAT return as required under Sec. 114
3. Understatement of taxable sales or receipts by 30% or more of his correct taxable sales or receipts of the taxable quarter

Question 26

Suspension of business operation

Failure of any person to register as required under Section 236

Answer 26

the temporary closure of the establishment shall be for the duration of not less than 5 days and shall be listed only upon compliance with whatever requirements prescribed by the CIR in the closure order

Question 27

these are actions instituted by the government to collect internal revenue taxes in the regular courts after assessment by the CIR has become final and executory

Answer 27

Ordinary Civil Action

Question 28

Ordinary Civil Action, Jurisdictions

Answer 28

1. CTA - P1 Million and above
2. RTC, MTC, MeTC - Less than P1 Million

Question 29

resorted to not only for the collection of taxes but also to impose statutory penalties

Answer 29

Criminal Action

Question 30

Criminal Action example

Answer 30

1. willful attempt to evade or defeat tax (Tax evasion)
2. Failure to file return, supply correct and accurate information, pay tax, withhold and remit tax and refund excess taxes withheld on compensation
3. Filed in the prosecutor’s office