3. RECURSOS DISTRIBUIDOS
3.1 Generación fotovoltaica
1. Income tax returns being public documents, until
controverted by competent evidence, are competent evidence, are
prima facie correct with respect to the entries therein. (Ropali Trading v. NLRC, et al., 296 SCRA 309, 317)
2. “ Married individuals, whether citizens, resident or
non-resident aliens, who do not derive income purely from compensation shall file a return for the taxable year to include the income of both spouses, but where it is impracticable for the
spouses to file one return, each spouse may file a separate return of income but the returns so filed shall be consolidated by the Bureau for purposes of verification.” [Section 51 (D) of the NIRC of 1997]
3. Individuals required to file an income tax return.
a. Every Filipino citizen residing in the Philippines;
b. Every Filipino citizen residing outside the Philippines on his income from sources within the Philippines;
c. Every alien residing in the Philippines on income derived from sources within the Philippines; and
d. Every nonresident alien engaged in trade or business or in the exercise of profession in the Philippines. [Sec. 51 (A) (1), NIRC of 1997]
4. Individuals who are not required to file an income tax return.
a. An individual whose gross income does not exceed his total personal and additional exemptions for dependents, Provided, That a citizen of the Philippines and any alien individual engaged in business or practice of profession within the Philippines shall file an income tax return regardless of the amount of gross income;
b. An individual with respect to pure compensation income for services in whatever form paid, including, but not limited to fees, salaries, wages, commissions, and similar items, derived from sources within the Philippines, the income tax on which has been correctly withheld, Provided, That an individual deriving compensation concurrently from two or more employers at any time during the taxable year shall file an income tax return: Provided, further, That an individual whose pure compensation income derived from sources within the Philippines exceeds Sixty thousand pesos (P60,000.00), shall also file an income tax return;
c. An individual whose sole income has been subject to final withholding tax;
d. An individual who is exempt from income tax pursuant to the provisions of the NIRC of 1997, and other laws, general or special. [Sec. 51 (A) (2), NIRC of 1997]
NOTES AND COMMENTS: Amendments under Rep. Act No. 9504 are not incouded.
5. An individual who is not required to file an income tax return may nevertheless be required to file an information return. [Sec. 51 (A) (3), NIRC of 1997]
6. A corporation files its income tax return and pays its income tax four (4) times during a single taxable year. Quarterly
returns are required to be filed for the first three quarters, then a final adjustment return is filed covering the total taxable income for the whole taxable year, be it calendar or fiscal.
7. An individual earning from the practice of his profession or who engages in trade or business files his income tax return and pays his income tax four (4) times during a single taxable year. Quarterly returns are required to be filed for the first
three quarters, then an annual income tax return is filed covering the total taxable income for the whole of the previous calendar year.
8. The purpose of the above four (4) times a year requirement is to make available sufficient funds to meet the budgetary requirements, on a quarterly basis thereby increasing
government liquidity. It also eases hardships on the part of individuals who are required to make this four time return. Thus, the taxpayer does not have to raise large sums of money in order to pay the tax.
9. An individual earning purely compensation income files only one annual income tax return covering the total taxable
compensation income for the whole of the previous calendar year.
10. Under the withholding tax system, taxes imposed or prescribed by the NIRC of 1997 are to be deducted and withheld by the payors from payments made to payees for the former to pay directly to the Bureau of Internal Revenue. It is also known as
collection of the tax at source.
11. A withholding agent is explicitly made personally liable under the Tax Code for the payment of the tax required to
be withheld, in order to compel the withholding agent to withhold the
tax under any and all circumstances. In effect, the responsibility for the collection of the tax as well as the payment thereof is concentrated upon the person over whom the Government has jurisdiction. (Filipinas Synthetic Fiber Corporation v. Court of Appeals, et al., G.R. Nos. 118498 & 124377, October 12, 1999) The system facilitates tax collection.
12. The two (2) types of withholding at source are the 1) final
withholding tax; and 2) creditable withholding tax.
13. Under the final withholding tax system the amount of income tax withheld by the withholding agent is constituted as a full and final payment of the income due from the payee on the said income. [1st sentence, 1st par., Sec. 2.57 (A), Rev. Regs. No. 2- 98]
The liability for payment of the tax rests primarily on the payor or the withholding agent.. Thus, in case of his failure to withhold the tax or in case of under withholding, the deficiency tax shall be collected from the payor withholding agent. The payee is not required to file an income tax return for the particular income.
14. Under the creditable withholding tax system, taxes withheld on certain income payments are intended to equal or at least approximate the tax due from the payee on the said income.
The income recipient is still required to file an income tax return and/or pay the difference between the tax withheld and the tax due on the income. [1st and 2nd sentences, Sec. 257(B), Rev. Regs. No. 2-98]
15. The two kinds of creditable withholding taxes are (a)
taxes withheld on income payments covered by the expanded withholding tax; and (b) taxes withheld on compensation income.
16. Payments to the following are exempt from the requirement of withholding or when no withholding taxes required:
a. National Government and its instrumentalities including provincial, city, or municipal governments;
b. Persons enjoying exemption from payment of income taxes pursuant to the provisions of any law, general or special, such as but not limited to the following:
1) Sales of real property by a corporation which is registered with and certified by the HLURB or HUDCC as engaged in socialized housing project where the selling price of
the house and lot or only the lot does not exceed P180,000.00 in Metro Manila and other highly urbanized areas and P150,000.00 in other areas or such adjusted amount of selling price for socialized housing as may later be determined and adopted by the HLURB;
2) Corporations registered with the Board of Investments and enjoying exemptions from income under the Omnibus Investment Code of 1997;
3) Corporations exempt from income tax under Sec. 30, of the Tax Code, like the SSS, GSIS, the PCSO, etc. However, income payments arising from any activity which is conducted for profit or income derived from real or personal property shall be subject to a withholding tax. (Sec. 57.5, Rev. Regs. No. 2-98)
17. “ A’ erroneously withheld the amount of 15% from the selling price of books authored by “ W” when the correct rate should have been 10% only. Since “ W” is out of the country, “ A” applied for a refund of the excess withholding of 5%. May “ A” properly apply for the refund ? Explain.
SUGGESTED ANSWER: Yes. In applications for refund, the withholding agent is a taxpayer because if he does not pay the tax shall be collected from him. (Commissioner of Internal Revenue v. Procter &
Gamble Philippine Manufacturing Corporation, 204 SCRA 377, 383-
386),
NOTES AND COMMENTS:
a. For tax amnesty purposes, the withholding agent is not a taxpayer because he is made to pay the tax where he fails to
withhold as a penalty and not that the tax is due from him. (Commissioner of Internal Revenue v. Court of Appeals, et al., G.R. No. 108576, January 20, 1999, the Anscor case)