Académique Documents
Professionnel Documents
Culture Documents
COMPUTATION
& REMEDIES
BIR MANDATE
The
Bureau of Internal Revenue is mandated by law to assess and collect all national internal revenue taxes, fees and charges, and to enforce all forfeitures, penalties and fines connected therewith, including the execution of judgements in all cases decided in its favor by the Court of Tax Appeals and the ordinary courts (Sec. 2 of the National Internal Revenue Code of 1997).
Tax on business; Real Property Taxes; Franchise Tax; Toll fees or charges; Community Taxes and others.
(Bureau of Internal Revenue/Bureau of Customs) Income Tax; Value-Added Tax; Percentage Tax; Excise Tax; Others.
4: Power of the Commissioner to Interpret Tax Laws and to Decide Tax Cases; Sec 5: Power of the Commissioner to obtain Information, and to Summon, Examine, and Take Testimony of Persons Sec 6: Power of the Commissioner to Make Assessments & Prescribe Additional Requirements for Tax Administration & Enforcement.
Income Tax Rate of 30% based on taxable income Corporate Income Tax- 2% Gross Income starting on the 4th year of operations.
Minimum
10,0000 10,000 30,000 500 30,000 70,000 2,500 70,000 140,000 8,500 140,000 250,000 22,500 250,000 500,000 50,000 500,000 125,000
a legitimate, illegitimate or legally adopted child chiefly dependent upon and living with the taxpayer if such dependent is not more than twenty-one (21) years of age, unmarried and not gainfully employed or if such dependent, regardless of age, is incapable of self-support because of mental or physical defect
SUMMARY
PERSONAL Single/ head of the family/Married with no dependent 50,000.00 ADDITIONAL NONE TOTAL 50,000.00
1 (one) qualified dependent child 2 (two) qualified dependent children 3 (three) qualified dependent children
50,000.00
100,000.00
150,000.00
Gross Receipts/Sales 1,590,000.00 Less: Cost of Sales/Services (1,240,000.00) Gross Income 350,000.00 Add: Other Taxable Income 140,000.00 Total 490,000.00 Less: Allowable Deductions 190,000.00 Net Income 300,000.00 Less: Personal Exemption 50,000.00 *Additional Exemption 50,000.00 100,000.00 Taxable Business Income 200,000.00 Income Tax Due *if two qualified dependent children 37,500.00
Plus
10,0000 10,000 30,000 500 30,000 70,000 2,500 70,000 140,000 8,500 140,000 250,000 22,500 250,000 500,000 50,000 500,000 125,000
1. 2. 3. 4.
examinations are based on selection criteria that are set yearly by the Commissioner of Internal Revenue in an ANNUAL AUDIT PROGRAM. Taxpayers are classified into categories: Mandatory cases; Top Priority Cases; Other Priority taxpayers; and Revenue District Officers discretion.
of Authority- authorizes a revenue officer of the BIR to conduct audit/investigation and examine the books of accounts and accounting records of a taxpayer for possible assessment of deficiency taxes and penalties.
Division determines whether or not there exists a sufficient basis to assess the taxpayer for any deficiency tax, a preliminary assessment notice (PAN) will be issued. The PAN must state the facts, law, rules and regulations upon which the assessment was based.
3.
4.
5.
Error in computation evident on the face of the return Discrepancy in the amount of tax withheld and tax remitted Taxpayer who opted to claim a tax refund or tax credit was determined to have carried over and applied the amount against succeeding liabilities Excise taxes due have not been paid Articles (such as cars) purchased by taxexempt persons have been transferred to nonexempt persons.
-within 60 days from filing of protest, all relevant supporting documents shall have been submitted.
In case of denial of protest in whole or in part, or is not acted upon within 180 DAYS FROM SUBMISSION OF DOCUMENTS
The
taxpayer adversely affected by the decision or inaction may appeal to the Court of Tax Appeals within 30 days from the receipt of decision or from the lapse of the 180-day period. Otherwise, the decision shall become FINAL, EXECUTORY & DEMANDABLE)
court shall have the authority to grant an injunction to restrain the collection of any national internal revenue tax, fee, or charge imposed by the Tax Code.
suit or proceeding shall be filed after the expiration of two (2) years from the date of payment of the tax or penalty regardless of any supervening cause that may arise after payment. But, the CIR may without written claim therefor, refund or credit any tax, where on the face of the return upon which payment was made, such payment appears clearly to have been erroneously paid.
Forfeiture
Forfeiture
of Tax Refund- if remains unclaimed or uncashed within five (5) years from the date of such warrant or check was mailed or delivered shall be forfeited in favor of the government and the amount thereof shall revert to the general fund. Forfeiture of Tax Credit- A TCC which shall remain unutilized after five(5) years from the date of issue, unless revalidated , shall be considered invalid.
In case of overpayment
An
excess of the total tax credits/payments over the actual income tax due computed in the final adjusted return may be refunded or issued with the Tax Credit Certificate to the taxpayer or credited against its estimated income tax liabilities for the quarters of the succeeding taxable years.
Claim must be in writing; 2. It must be filed with the Commissioner within two (2) years after the payment of the tax or penalty. Note: No suit or proceeding shall be begun after the expiration of the said two (2) years regardless of any supervening cause that may arise after payment. 3. Show proof of payment.
QUESTIONS?
Validity Effect
Legal and not subject Illegal and subject to criminal penalty to criminal penalty Minimization of taxes Almost always results in absence of tax payments
INDICIA OF FRAUD IN TAX EVASION FAILURE TO DECLARE FOR TAXATION PURPOSES TRUE AND ACTUAL INCOME DERIVED FROM BUSINESS FOR 2 CONSECUTIVE YEARS (REPUBLIC VS GONZALES, L-17962) Substantial under-declaration of income tax returns of the taxpayer for 4 consecutive years coupled with intentional overstatement of deductions