Policies and guidelines on disputed assessments
This Tax Alert is issued to inform all concerned of the uniform policies and guidelines on handling disputed assessments.
It is a basic policy that opportunities are given to taxpayers who choose to explain objection to an assessment and present necessary documents in support before issuance of FDDA.
Following are the guidelines in handling disputed assessments:
1. Protests against PAN is optional. Whether protested or not, FLD/FAN shall be issued within 15 days from receipt of the PAN. However if upon receipt of PAN, taxpayer accepts and pays the assessment partially or fully, a FLD/FAN shall be issued to formalize the assessment and payment Form 0605 shall be duly prepared, filed and paid to evidence the settlement.
2. If the taxpayer agrees to pay part or all of the amount assessed in the FLD/FAN, the amount accepted should be paid within 30 days from receipt of the FLD/FAN using Form 0605 as evidence of the settlement. An ATCA shall be prepared as evidence of the subsequent cancellation of portion of the assessment, if any. An FDDA shall be issued on the amount not settled.
3. The taxpayer should protest the assessment which he is not willing to pay within 30 days from receipt of FLD/FAN, by filing either:
i. Request for reconsideration if no additional evidence will be submitted
ii. Request for reinvestigation if additional documents will be submitted
A protest shall be considered a request for reconsideration unless it indicates a request for reinvestigation.
4. In a request for reinvestigation, documents should be submitted within 60 days from the date of filing of protest letter. No additional documents shall be accepted thereafter and the protest shall be evaluated exclusively based on the documents submitted. If no documents or incomplete documents are submitted, the assessment shall become final and executory and a collection letter or other collection remedies shall be enforced.
5. If the taxpayer files an appeal at the CTA after the lapse of the 180 days in case of reconsideration or 60 days from submission of documents in case of reinvestigation, an FDDA shall be issued automatically.
6. If the taxpayer decides to pay the amount in the FDDA, partial or in full, Payment Form 0605 be prepared, filed and the amount paid. Motion for reconsideration with the CIR or appeal to CTA may be filed within 30 days from receipt of FDDA for the unsettled portion.
7. In a motion for reconsideration, the taxpayer shall manifest that the appeal pertains only to the unsettled amount and copy of the payment form for the settled amount shall be attached. A protest is not available as remedy after issuance of FDDA.
8. Pending a motion for reconsideration with the CIR or an appeal at the CTA, the taxpayer still has the option to pay part or all of the disputed amount.