Remedy

Question 1

Issuance of Assessment

Answer 1

GR: taxes are self assessing and thus do not require the issuance of an assessment notice in order to establish the tax liability of a taxpayer.

Except: (PLDT)

1. Tax period has been terminated.
2. Deficiency tax liability arising from tax audit conducted by the BIR
3. Tax lien
4. Dissolving corporation.

Question 2

Delinquent tax

Answer 2

A taxpayer is considered delinquent in the payment of taxes when:
a. Self-assessed tax per return filed by the taxpayer on the prescribed date was not paid at all or only partially paid;
B. Deficiency tax assessed by the BIR becomes final and executory and the taxpayer has not paid it within the period given in the notice of assessment.

• Can immediately be collected administratively through the issuance of a warrant of distraint and levy, and/or judicial action.
• The filing of a civil action for the collection of the delinquent tax in the ordinary court is a proper remedy.
• A delinquent tax is subject to administrative penalties such as 25% surcharge, interest, and compromise penalty .

Question 3

Deficiency Tax

Answer 3

Deficiency when:
A. The amount by which the tax imposed by law as determined by the CIR or his authorized representative exceeds the amount shown as tax by the taxpayer upon his return;
B. If no amount is shown as tax by the taxpayer upon his return is made by the taxpayer, then the amount by which the tax as determined by the CIR or his authorized representative exceeds the amounts previously assessed or collected without assessment as deficiency.

• Can be collected through administrative and/or judicial remedies but has to go through the process of filling the protest by the taxpayer against the assessment and the denial of such protest by the BIR;
• The filling of a civil action at the ordinary court for collection during the pendency of protest may be the subject of a motion to dismiss. In addition to a motion to dismiss, the taxpayer must file a petition for review with the CTA to toll the running of the prescriptive period.
• A deficiency tax is generally not subject to the 25% surcharge, although subject to interest and compromise penalty.

Question 4

Requisites for valid assessment

Answer 4

1. Be in writing and signed by the BIR
2. Contain law and the facts on which assessment is made
3. Contain a demand for payment w/in the prescribed period.

Question 5

Jeopardy Assessment

Answer 5

A tax assessment made by an authorized revenue officer without the benefit of complete or partial audit, in light of officers belief that the assessmentand collection of the deficiency tax will be jeopardized by the delay caused by taxpayers failure to:

• Comply with the audit and investigation requirements to present his books or accounts and/or pertinent records, or
• Substantiate all or any of the deductions, exemptions or credits claimed in his return.

Question 6

Exceptions to Prior Notice of the Assessment. FAN issued outright.

Answer 6

(i) When the finding for any deficiency tax is the result of mathematical error in the computation of the tax appearing on the face of the tax return filed by the taxpayer; or
(ii) When a discrepancy has been determined between the tax withheld and the amount actually remitted by the withholding agent; or
(iii) When a taxpayer who opted to claim a refund or tax credit of excess creditable withholding tax for a taxable period was determined to have carried over and automatically applied the same amount claimed against the estimated tax liabilities for the taxable quarter or quarters of the succeeding taxable year; or
(iv) When the excise tax due on excisable articles has not been paid; or
(v) When an article locally purchased or imported by an exempt person, such as, but not limited to, vehicles, capital equipment, machineries and spare parts, has been sold, traded or transferred to non-exempt persons.