BIR Tax Authority Quiz

What happens if a taxpayer is unable to address a deficiency tax discrepancy?

What is required of taxpayers after receiving a Preliminary Assessment Notice (PAN)?

What must be included in the Formal Letter of Demand and Final Assessment Notice (FLD/FAN)?

What option does a taxpayer have if their protest against the FLD/FAN is denied?

What criteria must the Final Decision on a Disputed Assessment (FDDA) meet to be valid?

What is the purpose of the Letter of Authority (LOA) issued by the BIR?

What are the consequences of failing to submit the requested documents after receiving an LOA?

What is a Notice of Discrepancy (NOD) and when is it issued?

What opportunity is provided to taxpayers after receiving a Notice of Discrepancy?

What is the time frame for holding a Discussion of Discrepancy (DOD) after receiving the NOD?

Letter of Authority (LOA)

LOA is issued by the BIR to authorize tax examination of a taxpayer's accounts.
Specifies the type of tax under review: income tax, value-added tax, withholding tax, etc.
Typically targets one taxable year only.

Request for Documentation

LOA includes an attachment detailing the required documents: tax reports, tax returns, accounting records.
Revenue Officer (RO) uses these documents for examination purposes.
Failure to submit documents results in a second request, then a final notice.
Continued non-compliance may lead to a "Subpoena Duces Tecum," mandating document submission by a specific time.

Notice of Discrepancy (NOD)

Findings from document checks are submitted to the Revenue District Officer (RDO) for approval.
Taxpayers with tax deficiencies receive an NOD summarizing discrepancies.
Discussion of Discrepancy (DOD) allows taxpayers to explain their situation and present documents.
DODs must be conducted within 30 days of receiving the NOD.

Preliminary Assessment Notice (PAN)

If sufficient basis for deficiency tax is found, the Commissioner issues a PAN to the taxpayer.
Taxpayers must respond to the PAN within 15 days of receipt.

Formal Letter of Demand and Final Assessment Notice (FLD/FAN)

FLD/FAN is issued detailing the taxpayer's deficiency tax and basis for assessment.
Taxpayers may protest within 30 days of receiving the FLD/FAN.
Various forms of review: request for reconsideration or reinvestigation with a 60-day submission deadline for supporting documents.
Denied protests can be appealed to the Court of Tax Appeals (CTA) within 30 days.
If not acted upon within 180 days, the taxpayer can appeal to the CTA or wait for final decision.

Final Decision on a Disputed Assessment (FDDA)

The Commissioner's decision must include facts and legal basis; otherwise, it is void.

Test your knowledge on the BIR's Letter of Authority (LOA) process. This quiz covers the essentials of what an LOA entails, including the types of taxes examined and the documentation required for tax investigations. Perfect for understanding the role of the BIR in tax assessments.