Month: October 2026

COURT OF TAX APPEALS (CTA)

BIR’S ASSESSMENT IS CONCLUSIVE IF TAXPAYER FAILED TO FILE PROTEST WITHIN THE 30-DAY PERIOD; BUT BIR’S COLLECTION EFFORT MUST BE WITHIN THE 5-YEAR PERIOD FROM FLD/FAN ISSUANCE. The CTA has jurisdiction not only over disputed assessments but also over other matters arising under the NIRC, including BIR collection measures such as the levy and auction of real property; while a taxpayer generally has 30 days to protest an FLD/FAN, failure to do so makes the assessment final, executory, and demandable, but the finality of the assessment is distinct from the prescriptive period for its collection. Applying these rules, the CTA acquired jurisdiction because taxpayer timely filed its Petition and no prior administrative protest was necessary because the appeal concerned the BIR’s collection action rather than a disputed assessment. However, the deficiency EWT and DST assessments under the FLD/FAN were already conclusive because taxpayer failed to file a valid administrative protest within 30 days, thereby precluding it from subsequently challenging the assessments on their merits. Nevertheless, the BIR could no longer collect the assessed taxes because where the taxpayer failed to file the relevant returns, the BIR may assess within 10 years, but once an assessment is made, it must collect the assessed tax by distraint, levy, or court proceeding within five years from the assessment. Since taxpayer presented no evidence that it had filed the pertinent tax returns, the 10-year assessment period applied; nevertheless, the five-year collection period commenced upon service of the FLD/FAN. The BIR’s Warrant of Distraint and/or Levy was issued and the BIR seeking collection was filed only beyond the five-year period. the CTA held that prescription of collection may still be examined even though the assessment itself had become final and conclusive (City Government of Iligan v. Commissioner of Internal Revenue, CTA Case No. 11036, April 23, 2026)

QUESTIONS ON INTERLOCUTORY ORDERS OF THE CTA SHOULD BE RAISED WITH THE SUPREME COURT, NOT CTA EN BANC. The CTA En Banc has appellate jurisdiction only over final judgments, resolutions, or orders of a CTA Division, particularly resolutions on motions for reconsideration or new trial, and does not have jurisdiction over interlocutory orders issued while a case remains pending. An order is interlocutory when it resolves only a procedural or preliminary matter and leaves something further to be decided before the case can be finally disposed of. Applying these rules, the CTA En Banc held that the resolutions denying taxpayer’s request for an extension to file its Formal Offer of Evidence were interlocutory because they did not determine the merits of the case or terminate the proceedings; the CTA Division still had to continue hearing and resolve the main case, En Banc cannot entertain an appeal from an interlocutory ruling, nor may it exercise supervisory or certiorari jurisdiction over a CTA Division simply because the latter is conducting ongoing proceedings. This limitation prevents piecemeal appeals and unnecessary disruption of trial proceedings. The aggrieved party may instead proceed with the case before the Division and, if the eventual final judgment is adverse, raise the interlocutory ruling as an assigned error in an appeal to the En Banc; in exceptional cases involving grave abuse of discretion amounting to lack or excess of jurisdiction, the proper remedy is a Rule 65 petition for certiorari directly with the Supreme Court, not an immediate appeal to the En Banc. Since the main proceedings in the CTA Division had not yet been concluded and no final judgment existed, the petition was premature and the CTA En Banc dismissed it for lack of jurisdiction [Aeon Credit Services (Philippines), Inc. v. CIR, CTA En Banc Case No. 3091 (CTA Case No. 10693), April 30, 2026]

BIR MUST PROVE ACTUAL RECEIPT OF FLD/FAN IF TAXPAYER DENIES RECEIPT. An assessment must comply with due process, including proper service of the PAN and FLD/FAN, and where the taxpayer denies receipt, the CIR bears the burden of proving actual receipt by competent evidence; an assessment cannot become final and executory without proper service and receipt. Applying these rules, the CTA En Banc sustained the cancellation of the deficiency VAT assessment because the taxpayer categorically denied receiving the FLD/FAN and the BIR failed to present substantial evidence establishing that it was properly served and actually received. Although the BIR argued that the FLD/FAN was mailed to respondent’s registered address in Parañaque, the records showed that the BIR itself had already personally served the LOA, NIC, and PAN at the taxpayer’s new Makati address, demonstrating that it knew where taxpayer was located. More importantly, the BIR’s reliance on the old registered address and its presentation of an LBC courier receipt alone did not sufficiently prove service because the rules require the server’s written report under oath detailing the manner, place, and date of service and the relevant courier information. The disputable presumption that a properly mailed letter was received was likewise overcome by the taxpayer’s categorical denial, shifting the burden back to the BIR to prove actual receipt. Thus, there was no valid assessment, and the subsequent WDL could not be enforced. [Commissioner of Internal Revenue v. Diamond Drilling Corporation of the Philippines, CTA EB No. 3151 (CTA Case No. 10661), May 4, 2026]

REVENUE OFFICERS’ (RO) AUTHORITY MUST BE FROM A LOA, NOT FROM MEMORANDUM OF ASSIGNMENT (MOA). A valid LOA is required to clothe RO with authority to examine a taxpayer and recommend deficiency tax assessments, and only the RO specifically named in the LOA may conduct the examination; reassignment or substitution of revenue officers requires a new or amended LOA. Applying these rules, the CTA En Banc held that it could rule on the RO’s lack of authority even though the issue was raised only on appeal, since the rules authorize the CTA to resolve related issues necessary for the orderly disposition of a case. Although an initial LOA was issued by the Assistant Commissioner, the actual examination was conducted by ROs whose authority purportedly arose from a MOA signed by a Chief who was not among the officials authorized to issue LOAs. the CTA En Banc affirmed the cancellation of the assessments and the refund of tax [Commissioner of Internal Revenue v. Central Luzon Drug Corporation, CTA EB No. 3111 (CTA Case No. 10045), May 8, 2026]

BUREAU OF INTERNAL REVENUE

Revenue Memorandum Circular No. 98-2026

BIR DEADLINES FROM SEPTEMBER 28, 2026 TO OCTOBER 4, 2026. A gentle reminder on the following deadlines, as may be applicable: