Dear CLIENTS, COLLEAGUES and FRIENDS:
For your reference and file, we are pleased to send our regular corporate, tax and other legal digest.
In this Article:
SECURITIES AND EXCHANGE COMMISSION (“SEC”)
- CORPORATIONS SHALL HAVE PERPETUAL EXISTENCE UNLESS ARTICLES OF INCORPORATION PROVIDES OTHERWISE; REQUIREMENTS ON SEC SUBMISSION.
BUREAU OF INTERNAL REVENUE (“BIR”) DEADLINES AND ISSUANCES:
- BIR DEADLINES from AUGUST 29 to September 5, 2020
- Individuals prevented from leaving the Philippines due to travel covid-19 travel restrictions are not considered present in the Philippines for tax residence purposes for the period after the scheduled departure as long the individual leaves the Philippines as soon as travel restrictions and/or quarantine measures have been lifted.
- Appraisal of property is no longer mandatory in sale, barter, exchange or disposition of shares of stock held as capital asset; audited financial statements are sufficient.
COURT OF TAX APPEALS (“CTA”) DECISIONS
- PHP 46 MILLION EXCESS INPUT VAT REFUND PARTIALLY GRANTED; REQUISITES FOR REFUND OF EXCESS AND UNUTILIZED INPUT VAT ON PURCHASE OF GOODS AND SERVICES ATTRIBUTABLE TO ZERO-RATED SALES.
- PHP 3.7 BILLION TAX ASSESSMENT CANCELLED; A STATEMENT THAT THE INTEREST AND TOTAL AMOUNT DUE SHALL BE ADJUSTED RENDERS THE LIABILITY INDEFINITE AND THUS THE ASSESSMENT VOID.
- REFUND OF INPUT VAT FROM DENIED; TIMELINE IN REFUND OF EXCESS INPUT VAT ARISING FROM ZERO-RATED SALES.
- PHP 95 MILLION TAX ASSESSMENT UPHELD: TAXPAYER MUST STATE THE FACTUAL AND LEGAL BASIS IN ITS PROTEST; PRELIMINARY COLLECTION LETTER IS CONSIDERED A FINAL DEMAND OF THE BIR FOR PURPOSES OF 30-DAY PERIOD TO APPEAL THE TAX ASSESSMENT.
- PHP 4 MILLION LOCAL BUSINESS TAX ASSESSMENT CANCELLED: LOCAL BUSINESS TAX ON CONTRACTORS IS BASED ON GROSS RECEIPTS AND NOT REVENUES; CTA HAS NO JURISDICTION TO RULE ON THE VALIDITY OF BUSINESS LICENSE.
- A MEMORANDUM OF AUTHORITY AUTHORIZING BIR EXAMINER TO CONDUCT AUDIT IS CONSIDERED A LETTER OF AUTHORITY BUT MUST BE SIGNED BY THE REGIONAL DIRECTOR OR ASSISTANT COMMISSIONER/HEAD REVENUE EXECUTIVE ASSISTANT.
- PHP 23 MILLION TAX ASSESSMENT CANCELLED: CERTIFICATION FROM THIRD PARTY IS REQUIRED TO VERIFY THE BIR’S FINDINGS OBTAINED FROM ITS COMPUTERIZED MATCHING; BIR HAS 3 YEARS TO ASSESS SANS FRAUD.
- PHP 29 MILLION TAX ASSESSMENT CANCELLED; IF TAXPAYER DENIES RECEIPT OF TAX ASSESSMENT, THE BURDEN TO PROVE SUCH FACT OF RECEIPT IS SHIFTED TO THE BIR.
