WHEN news about fake nongovernment organizations (NGOs) related to the pork barrel scam hit the headlines, other non-stock, nonprofit organizations (NSNPs) attracted the probing eyes of the Bureau of Internal Revenue (BIR). As a result, the BIR issued on June 6, 2014 Revenue Memorandum Circular (RMC) No. 51-2014, which aimed to tighten the interpretation and treatment of tax-exempt NSNPs under Section 30 of the Tax Code.
THE DYNAMIC character of tax laws is due in large part to the wealth of jurisprudence that through the years have helped interpret, clarify and elaborate Tax Code provisions and their implementing rules and regulations. On some occasions, court rulings have even upheld the constitutionality of tax issuances and looked favorably on decisions and policies made by tax officials. Judicial interpretations both from the Court of Tax Appeals (CTA) and the Supreme Court (SC) breathe new life to tax laws, introducing insightful perspectives. Nowhere is this more evident than in the refunds of excess creditable withholding tax (CWT).
THE VAT TREATMENT of sale of motor vehicle by persons who are not in the regular business of selling cars has often been raised as an issue in tax examinations. The provision usually cited is Section 105 of the Tax Code which provides that VAT shall be imposed on any person who, in the course of trade or business sells, barters, exchanges, leases goods or properties, and renders services. The phase “in course of trade or business” is defined in the same section as “the regular conduct or pursuit of a commercial or an economic activity, including transactions incidental thereto.”
EVER since the introduction of the 1997 Tax Code, domestic corporations classified as closely-held corporations have been exposed to the 10% improperly accumulated earnings tax (IAET) for failure to declare dividends, which are beyond the reasonable needs of the corporation.
MANILA, Philippines – The Bureau of Internal Revenue filed on Thursday criminal charges against a trader of office supplies for tax evasion and other violations of the tax code. BIR filed the complaint against Kristian Soriano at the Department of Justice “for willful attempt to evade or defeat tax, deliberate failure to supply correct and accurate information in his Income Tax Return (ITR) and Value Added Tax (VAT) Returns for taxable year 2010 and Perjury, in violation of Sections 254, 255 and Section 267 of the National Internal Revenue Code of 1997.” Soriano is the sole proprietor of Natriks Enterprise, which trades office supplies. Charged with Soriano is his certified public accountant Crisanto Laguardia, Jr. who certified his financial statements in 2010. Soriano reportedly under-declared his firm’s 2010 sales by P125.16 million or 13,381 percent, after being paid by the Philippine National Police a total of P133.66 million in a transaction made in 2010. Soriano, however, declared only P935,382.77 in his income tax return during the same year. “Under Section 248 (B) of the Tax Code, an under-declaration of taxable income by more than 30 percent is considered substantial underdeclaration and constitutes a prima facie case of fraud tantamount to tax evasion,” the tax bureau said. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 BIR added that Soriano was sued for a total tax liability amounting to P101.9 million for deficiency taxes in 2010. Laguardia, meanwhile, was charged for issuing unqualified opinion in his certification of Soriano’s 2010 financial Read More …
MANILA, Philippines – The Bureau of Internal Revenue filed on Thursday criminal charges against two flower shops who failed to issue receipts in violation of the National Internal Revenue Code of 1997. The state agency charged Sylvia Pimentel, sole proprietress of Flowers by Sylvia, a flower shop in San Antonio Village, Makati City. The bureau likewise filed with the Justice Department a complaint against Casa Flores, Inc. and its president Belen Bactad, vice-president Edgar Bactad and treasurer/secretary Fe de Belen Bactad de Leon. BIR said the two flower shops were subjected to covert surveillance operations to verify whether or not they are issuing receipts as mandated by the Tax Code. “Two BIR investigators acted as poseur customers who bought flowers from Pimentel’s flower shop. Her establishment did not issue to the first buyer any official receipt but instead issued an unregistered provisional receipt that did not conform to the invoicing requirements provided under the Tax Code. It still failed to issue any receipt to the second buyer but instead issued for the second time an unregistered provisional receipt,” the bureau said. BIR added that the same happened with Casa Flores, which only issued an unregistered delivery receipt that did not conform to the invoicing requirements of the Tax Code. “It likewise failed to issue any receipt to the second buyer but issued a cash invoice only upon demand,” BIR said. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 The shops were served mission orders before the investigators apprehended and Read More …