QUIZ ON TAX REMEDIES 1. Compromise penalties are not allowed for: 2. Failure to preserve or keep books of accounts and accounting records b. Failure to keep books of accounts or records in a native language or in English €. Failure to have books of accounts audited and have financial statements attached to income tax return certified by an independent CPA d. Keeping two (2) sets of books of accounts or records. 2. Tax violations may be compromised: A) Except those already filed in court 8) Except those involving fraud a. True, true b. True. False c. False, true d. False, false 3. For filing a false and fraudulent return, a surcharge Is imposed at: a. 25% as criminal penalty b. 25% as administrative penalty c. 50% as criminal penalty d, 50% as administrative penalty 4. This is not an administrative remedy available to @ taxpayer in connection with collection of taxes Filing a petition for reconsideration or reinvestigation b. Filing a claim for tax refund or credit Entering into a compromise @. Filing a criminal complaint against erring BIR officials or employees 5. A compromise for a tax liability on the ground of financial incapacity to pay shall still involve a payment of tax from the taxpayer at a minimum compromise rate of 10% of the basic assessed tax b. 20% of the basic assessed tax c. 30% of the basic assessed tax d. 40% of the basic assessed tax 6. Using the preceding no., with regard to compromises other than on the ground of financial incapacity to pay, the compromise shall involve a minimum compromise rate of a, 10% of the basic assessed tax b. 20% of the basic assessed tax c. 30% of the basic assessed tax d. 40% of the basic assessed tax 7. Statement 1: The C1R may refund a tax even without a claim for refund from the taxpayer where on the face of the return upon which the payment wes made; such payment clearly appears to have been erroneously made, ‘Statement 2: When 2 years are about to expire from the date of payment and no decision has yet been received by the taxpayer on his claim for refund filed with the BIR, the taxpayer may appeal to the CTA even without waiting for the decision of the BIR on his claim for refund a. True, true b. True, false c, False, true d. False, false 8. Statement 1: The CIR is authorized to inquire into the bank deposit of a taxpayer who has filed an application for compromise of his tax liability by reason of financial incapacity to pay. Statement 2: The CIR is authorized to look into the bank deposit of a decedent to determine his gross estate.True, true True, false. False, true False, false 9. An assessment shall become final if not protested administratively, if such protest is not fited with the BIR, from receipt of the assessment within a. 30 days b. 60 days ¢. 90 days d. 180 days 10, Using the preceding no., relevant supporting documen': must elso be presented to the BIR, from filing the protest on the assessment within a. 30 days b. 60 days c. 90 days d. 180 days 11.An appeal on an assessment may be made to the CTA if the BIR does not act on the protest within, how many days from the taxpayer's submission of documents supporting his protest? a. 30 days b. 60 days c. 90 days d, 180 days 12,Statement 1: The taxpayer shall respond to a pre-assessment notice, and if he fails to respond, an assessment shall be issued. Statement 2: An assessment Issued may be questioned administratively with the BIR. a. True, true b. True, false c. False, true d. False, false 13.Where @ return was filed, as a general rule, the prescriptive period for assessment after the date the return was due or was filed, whichever Is later, is within a. 3 years b. 5 years c. 7 years d. 10 years 14. Where any national internal revenue tax is alleged to have been erroneously or illegally collected, as a remedy, the taxpayer should first file an action for refund with the a, Regional Trial Court b. Court of Tax Appeals c. BIR d. Court of Appeals 15. In case of an assessment of a tex ‘a. The assessment should be made within 3 years from the date of filing of the return b. The assessment should be made within 3 years from the date of the return is due c. A protest should be made on time, otherwise the assessment becomes final and executory d. A protest may be filed anytime before the BIR collects the tax 16. Date of payment of tax erroneously paid April 15, 2005 Date a claim for refund was filed January 15, 2006 Date decision of denial by the BIR was received September 15, 2006Last day to appeal to the CTA is a. April 15, 2007 b. January 15, 2007 c. November 15, 2006 d. October 15, 2006 17. Using the preceding number, if date of decision of denial by the BIR was received on March 31, 2007, the last day to appeal to the CTA Is, a. April 30, 2007 b, April 15, 2007 c, March 31,2008 d. May 30, 2007 18. Date assessment was received March 8, 2007 Date petition for reconsideration was filed with the BIR March 18, 2007 Date filing of documents to support the petition May 8, 2007 Date decision of denial of the petition was received September 28, 2007 The last day to appeal to the CTA is a. April 15, 2008 b. November 8, 2007 c, December 8, 2007 d. October 28, 2007 19. Date assessment was received March 8, 2007 Date petition for reconsideration was filed with the BIR March 28, 2007 Date of filing of documents to support the petition May 8, 2007 No decision on the protest is received as of October 30, 2007 The last day to appeal to the CTA is a. April 15, 2008 b. November 8, 2007 c, December 6, 2007 d, November 30, 2007 20.A car dealer could not pay his taxes on sales. The dealer delivered several units of the car to the Bureau of Internal Revenue in payment of the taxes. Which of the following statements is correct? a. There is a valid payment of the tax. b. There is in effect a collection of the tax by distraint. . There is a valid forfeiture of property. d. This is not a valid procedure for collection of the tax. 21, Which of the following is correct? a. A protest should be filed by the taxpayer, otherwise the assessment becomes final and can no longer be questioned in court b. A protest may be filed by the taxpayer anytime before the BIR collects the- tax c. The assessment should be made by the BIR within five years from the filing of the return d. The assessment shall include only tax proper 22, Which of the following will not interrupt the running of the prescriptive period for assessment and collection of taxes: a, When the Commissioner is prohibited from making the assessment or beginning distraint and levy or 2 proceeding in court and for thirty (30) days thereafter. b. When the taxpayer requests for the reinvestigation which is granted by the Commissioner. ¢. When the taxpayer is out of the Philippines.d. When the taxpayer cannot be located in the address given by him in the return, 23. The following are grounds to cancel a tax liability by the commissioner, except a. The tax is unjustly or excessively-assessed b, The administration and collection costs involved do not justify the collection of the amount c. Areasonable doubt as to the validity of the claim ayainst the taxpayer d. Illegal collection of tax 24, Which of the following is not a requisite to toll the a collection of tax to be made by the BIR, upon proof of the following to the Court of Tax Appeals a. It will jeopardize the interest of the taxpayer b. It will jeopardize the interest of the government c. Filing of a bond for at least double the amount of the tax assessed d The case is not dilatory 25. Occupying the forefront of tax law enforcement is the: a, Department of Finance b. Bureau of Internal Revenue c. Legislative Department d. Executive Department, 26.The power to decide disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties imposed in relation thereto, or other matters arising under the Tax Code or other laws administered by the BIR is vested with a. The Commissioner of the BIR b. The Secretary of Finance c. The Court of Tax Appeals d, The Regular Courts 27.It is the official action of an administrative officer in determining the amount of tax due from a taxpayer, or It may be a notice to the effect that the amount stated therein is due from the taxpayer with a demand for payment of the tax or deficiency stated therein a. Tax investigation b. Tax audit c. Tax assessments d. Tax mapping 28. Which of the following is not the remedy of the government in tax collection? a. Tax lien b. Compromise c. Forfeiture d. Protest 29.Commissioner of BIR may compromise any internal revenue tax when, except one a, A reasonable doubt as to the validity of the claim against the taxpayer exists b. The financial position of the taxpayer demonstrates a clear inability to pay the assessed tax c. The tax or any portion thereof appears to be unjustly or excessively assessed d. The taxpayer has been granted by the SEC or by any competent ‘tribunal @ moratorium or suspension of payments to creditors, or otherwise declared bankrupt or insolvent 30.ABC Corporation won a tax refund case for PSO Million. Upon execution of the judgment and when trying to get the Tax Credit Certificates (TCC) representing the refund, the Bureau of Internal Revenue (BIR) refused to issue the TCC on the basis of the fact that the corporation is under audit by the BIR and it has @ potential tax liability. Is there a valid justification for the BIR to withhold the Issuance of the TCC? a. Yes, power of the BIR to make assessment and collection of all national internal revenue taxes, fees and charges. b. Yes, power of the BIR to enforce all national taxes, fees and charges including forfeitures, penalties and fines connected therewith.c. No, BIR is only in the assessment stage and not yet in the collection stage. d. No, the BIR is inferior to the courts. 31.0n June 2, 2003, Global Bank received a final notice of assessment from the BIR for deficiency documentary stamp tax in the amount of PSmillion. On June 30, 2003, Global Bank filed a request for reconsideration with the Commissioner of Internal Revenue. The Commissioner denied the request for reconsideration only on May 30, 2006, at the same time serving on Global Bank a warrant of distraint to collect the deficiency tax. What are the remedies of Global Bank? ‘a. Appeal to the Court of Tax of Appeals within 30 days from receipt of the denial. b. Appeal to the Court of Tax of Appeals within 15 days from receipt of the denial. c. File for injunctive relief to restrain the distraint. d. Enter into a compromise agreement with the Commissioner of Internal Revenue. 32.Mr. Abraham Eugenio, a pawnshop operator, after having been required by the Revenue District Officer to pay value added tax pursuant to a Revenue Memorandum Order of the Commissioner on Internal Revenue, where will Mr. Eugenio file an action questioning the validity of the RMO? a. Regional Trial Court b. Court of Tax of Appeals ¢. Commissioner of the BIR d, Supreme Court 33.The powers and duties of the Bureau of Internal Revenue comprehend the following, except? a. Assessment and collection of all national and local revenue taxes. b. Enforcement of all forfeitures, penalties and fines in connection connected with the collection of national internal revenue texes, c. Execution of judgment in all cases decided in its favor by the Court of Appeals, and the ordinary courts. d. Effecting and administering the supervisory and police powers conferred to it by the Tax Code or other laws 34. CDE Corporation filed its income tax return for the calendar year 2003 on April 10, 2004. The return was not false or fraudulent, the last day for the BIR to collect if without prior assessment is a, April 10, 2007 b. April 15, 2007 cc. April 10, 2009 d. April 15, 2009 35. Using the preceding number, if assessment was made on April 10, 2007, the last day to collect is. a. April 10, 2030 b. April 15, 2010 . April 10,2012 d. April 15, 2012 36. The period of limitation for assessment of taxes is not suspended. a. The return filed contained inaccuracies due to omissions and mistakes b. There is failure to file the required return c. The taxpayer and the CIR agreed on the extension of the period d. The return filed is fraudulent and made with the intent to avoid the tax. 37. The official action of an officer authorized by law in ascertaining the amount of tax due under the law from a taxpayer is a, Assessment b. Delinquency % d. Distraint 38. The seizure by the government of personal property to enforce the payment of taxes to be followed by its public sale if the taxes are not voluntarily paid39. 40. 41. 42, 43. 44, 45. Assessment Delinquency Levy Distraint The seizure by the government of real property to enforce the payment of taxes to be followed by its public sale if the taxes are not voluntarily paid ‘Assessment Delinquent Levy Distraint aoge Tie power to decide disputed assessments, refunds of internal revenues taxes, fees or other charges, penalties imposed in relation thereto, or other matters arising under the Tax Code or other laws or provisions thereof administered by the BIR is vested in the a, Secretary of Finance b. Regional Trial Court cc. Court of Tax Appeals d. Commissioner of internal Revenue The power referred to above is subject to the exclusive appellate jurisdiction of the a. Commissioner of Internal Revenue b. Regional Trial Court c. Secretary of Finance d. Court of Tax Appeals The Commissioner of Internal Revenue may compromise the payment of any internal revenue tax when I. Areasonable doubt as to the validity of the claim against the taxpayer exists II. The tax or any portion thereof appears to be unjustly or excessively assessed. III. The financial position of the taxpayer demonstrates a clear inability to pay the assessed tax. a. Land It b. Tand iit c. Hand I d. 1, and 1 ‘The Commissioner of Internal Revenue may abate or cancel the liability when I, The administration and collection costs involved do net justify the collection of the amount due. II. A reasonable doubt as to the validity of the claim against taxpayer exists. III. The tax or any portion thereof appears to be unjustly excessively assessed IV. The financial position of the taxpayer demonstrates a clear inability to pay the assessed tax. a. Only 1 b. Tand c. Land Ill d. Tand IV A's income tax liability for 2006 was P75,000. She filed the return and paid the total amount due on July 15, 2007 but’ not with the proper internal revenue district office. The amount payable by A is 97,500 P116,250 135,000 112,500 pose Gerry was being prosecuted by the BIR for failure to pay his income tax liability for Calendar Year 1999 despite several demands by the BIR in 2002. The information was filed with the RTC only last June 2006. What are the remedies of Gerry? a. Gerry should file a motion to quash the information on the ground of prescription.b. Gerry should answer the information. c. Gerry should file a protest with the Commissioner of BIR. d. Gerry should appeal to the CTA. 46. For a finding of “filing a fraudulent return" by the BIR to prosper: Statement 1: Fraud must be intentional, consisting of deception willfully and deliberately done or resorted to in order to avoid payment of the tax. ‘Statement 2: Fraud cannot be presumed but must be proved. Fraudulent intent ‘can not be deducted from mistakes however frequent they may be, especially if such mistakes emanate from erroneous classification of items in accounting methods utilized for determination of tax liabilities. a. True; False b. True; True c. False; True d, False; False 47. The prescription of check or warrant refund or tax credit shall be within: a. 4 years from the date of issues b. 5 years from the date of issue c. 10 years from the date of Issue d. 12 years from the date of issue 48.1% Statement - The BIR Commissioner upon the recommendation of the Secretary of Finance, shall promulgate all needful rules and regulations for the effective enforcement of the provisions of NIRC. 2% Statement - The rules and regulations of the BIR shall contain the conditions to be observed by revenue officers respecting the institution and conduct of legal actions and proceedings. a. True; False b. True; True ¢. False; True d. False; False 49, 1% Statement - All violations of any provision of the NIRC shall prescribe after four (4) years. 24 Statement - Prescription shall begin to run from the day of the commission of the violation of the Jaw, even if the offender is outside the Philippines. a, True; False b. True; True c. False; True d. False; False 50.A suit questioning the validity of a tax statute or law is: Taxpayer's suit Derivative suit Class suit Representative suit 51. 1% Statement - The BIR is authorized to collect estate tax deficiency through the summary remedy of levying upon and sale of real properties of a decedent, without the cognition and authority of the court. 2" Statement - The CIR may examine the bank records of the deceased in order to determine the latter's taxable net estate. a. True; False b. True; True c. False; True d. False; False 52. The following are the authorities of the Commissioner to reduce revenue taxes, except: a. Compromise the payment of any internal revenue tax when a reasonable doubt as to the validity of claim against the taxpayer exists. b. Compromise the payment of any internal revenue tax when the financial condition of the taxpayer demonstrates a clear ability to pay the assessed tax. ¢. Abate tax liability when a portion thereof appears to be unjustly or excessively assessedd. Credit or refund taxes erroneously or illegally received or penalties imposed without authority. 53. 1" Statement: In general, no 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 NIRC. 2" Statement: The Court of Tax Appeals may Issue an injunction to toll the collection of a tax. a. True; False b. True; True c. False; True d. False; Felse 54, 15 Statement - The taxpayer may claim his defense of prescription while the case is pending before the BIR or in the CTA. 2" Statement - A compromise is not permitted in cases finally decided by the courts as there is no longer any necessity or reason for the exercise of the power. a. True; False b. True; True c. False; True d. False: False 55.1% Statement: Generally, internal revenue taxes shall be assessed within three years after the last day prescribed by law. 2° Statement: If the return was amended substantially, the counting of the period starts from the date the amended return was filed, a. True; False b. True; True c. False; True d. False; False 56. The following are the reasons which necessitates the filing of an administrative claim for refund with the BIR, except: a. To afford the Commissioner an opportunity to consider the claim. b. To give the Commissioner a chance to correct the errors of subordinate officers. c. To notify the Government that such taxes have been questioned and the notice should be borne In mind in estimating the revenue available for expenditures. d. To give ample time to the Commissioner in preparing the cash to be disbursed for the taxpayer's refund. 57.1 Statement: Assessment is not necessary before a taxpayer maybe prosecuted if there is a prima facie showing of a willful attempt to evade taxes as in the taxpayer's failure to declare a specific item of taxable income in his income tax return. 2° Statement: Assessment is not necessary before the Government could administratively collect the tax due a. True; False b. True; True c. False; True d, False; False 58.1% Statement: A refund check or warrant, which shall remain unclaimed or uncashed after five (5) years from the date the said warrant was mailed or delivered shall be forfeited in favor of the Government. 2% Statement: A tax credit certificate which shall remain unutilized after five (5) years from the date of its issue, unless revalidated, be considered invalid and shall not be allowed as payment for internal revenue taxes. a. True; False b. True; True c. False; True d. False; False 59. The following are the powers of the BIR, except:60. 61. 62. 63. 64, 65. The assessment and collection of all national internal revenue taxes. The execution of all judgments in all cases decided in its favor by the CTA and the ordinary courts. c. The enforcement of all forfeitures, penalties and fines connected with national internal revenue taxes. d. The assessment and collection of some customs duties, 1* Statement - The Commissioner of Internal Revenue shall have the power to inquire into a taxpayer's bank deposit in relation to all internal revenue taxes. 2° Statement - The Commissioner of Internal Revenue shall have the power to prescribe real property values: a. True; False b. True; True c. False; True d, False; False The following powers of the Commissioner may not be delegated, except: a, The power to recommend the promulgation of rules and regulations by the of secretary finance. The power to issue ruling of first impression or to reverse, revoke or modify any existing ruling of the bureau. c. The power to compromise or abate internal revenue taxes save for a few. d, The power of the commissioner to make assessments. 1# Statement - A party adversely affected by a resolution of a division of the CTA has no other recourse but to appeal to the Court of Appeals. 2" Statement - A party adversely affected by a resolution of a division of the CTA ‘on a motion for reconsideration or new trial, may file a petition for review with the CTA en banc. a, True; False b. True; True c. False; True d. False; False 1 Statement - The CTA may sit en banc or in three divisions each divisions consisting of 3 justices. 2% Statement - The Court of Tax Appeals, now treated as having the same level las the Court of Appeals, shall be composed of 1 presiding justice and 8 associate justices. a. True; False b. True; True c, False; True, d. False; False 1* Statement - The fact that an individual's name is signed to a filed return shall be prima facie evidence for all purposes that the return was actually signed by him, 2 Statement - If a taxpayer is unable to make his return, the return may be made by his guardian or representative, the latter assuming the responsibilities of making the return and incurring penalties if the same was erroneous. a. True; False b. True; True c. False; True d. False; False 1® Statement - An individual may employ either calendar year or fiscal year as basis for filing its annual, income tax return. 2 Statement - The return of any individual shall be filed on or before the 15% day of April of each year covering income for the preceding year. a. True; False b. True; True ¢. False; True d. False; False10 66. The following are agents and deputies for collection of National Internal Revenue taxes, except: a, The commissioner of Customs and his subordinates with respect to the collection of national Internal Revenue Taxes on imported goods. b, The head of the appropriate government office and his subordinates with respect to the collection of energy tax. c, Banks duly accredited by the commissioner with respect to receipts of payments of internal revenue taxes authorized to be made thru banks. d. City treasurer with regard to collection of real estate tax. 67. The chief officials of the BIR shall be composed of: ‘a, 1 Commissioner and 4 Deputy Commissioners b. 1 Commissioner and 5 Deputy Commissioners c, 1 Commissioner, 2 Assistant Commissioners and 2 Deputy Commissioners. d. 1 Commissioner and 7 Deputy Commissioners. 68. What are the requites in order that distraint or levy may be exercised by the government, EXCEPT? a. The taxpayer must be delinquent in the payinent of taxes (except in constructive distraint); b. There must be a subsequent demand for its payment; c. The taxpayer failed to pay the delinquent tax within the period prescribed; 4d, The period for assessment or collection has prescribed. 69. When is 25% surcharge imposable, EXCEPT? a. Failure to file the required tax return deliberately; b. Filing a return with the wrong internal revenues office; ¢. Failure to pay the deficiency tax within the time prescribed; d. Failure to pay the full amount of tax shown on the return within the time prescribed. 70.When may the BIR terminate taxing period, EXCEPT? When the taxpayer is retiring from business subject to tax; When the taxpayer went abroad; When the taxpayer removes his property from Philippines; When the taxpayer hides or conceals his property; When the taxpayer performs any act tending to obstruct the proceeding for collection of taxes; 71, What are the means employed in the assessment of taxes, EXCEPT? a. Examination of tax returns (tax audit); b. Inventory taking surveillance and use of presumptions gross sales or receipts; ¢. Prescription of real property values; d, Examination of bank deposits; , Requiring of additional documentary evidences. 72. The authorities of the Commissioner include the following except: a. Compromise the payment of any internal revenue tax b. Abate a tax liability ¢. Credit or refund tax that had been erroneously received d. Inquire into bank deposit 73. Which of the following is not a requisite to toll the collection of taxes to be made by the Bureau of Internal Revenue, upon proof of the following to the Court of Tax Appeals? a. It will jeopardize the interest of the taxpayer} b. It will jeopardize the interest of the Government} c. Filing of a bond double the amount of tax assessed; d. The case is not dilatory. 74. Jane filed his annual income tax return on May 22, 2006 for income earned during 2005, The BIR examiner assessed Jane for tax delinquency on October 15, 2007. Jane filed a protest plus all documentary evidence on Nov. 8, 2007 with the Commissioner of the Internal Revenue. The Commissioner rendered itsnN unfavorable judgment on May 10, 2008. When is the last day to appeal the case to the Court of Tax of Appeals. a b. June 8, 2008 c. May 25, 2008 June 10, 2008 d. May 22, 2008 75. Commissioner of Bureau of Internal Revenue may abate any internal revenue tax when, except one: b. c The tax or any portion thereof appears to be unjustly or excessively assessed The administration and collection costs involved do not justify the collection of the amount due. Where on the face of the return upon which payment was made such payment appears clearly to have been erroneously paid. The delinquent account or disputed assessment is one resulting from a jeopardy assessment.