Tax Remedies

Direction: Read the question in each item carefully. Encircle the letter of the
correct answer from the given choices.

1. Broadly defined, this informs the taxpayer that he or she has tax liabilities.
a. Assessment c. Letter of authority
b. Investigation d. Litigation

2. Statement 1: An assessment can be orally made.

Statement 2: An assessment should contain the law and the facts on which the assessment is
based.
a. Only Statement 1 is true. c. Both statements are true
b. Only Statement 2 is true d. Both statements are not true

3. Statement 1: Assessment are presumed to be correct

Statement 2: Assessment are discretionary on the part of the Commissioner.
a. Only Statement 1 true c. Both statements are true
b. Only Statement 2 is true d. Both statements are not true

4. This occurs when self-assessed tax per return filed by the taxpayer on the prescribed date was
not paid at all or only partially paid.
a. Deficiency tax c. Deficit tax
b. Delinquency tax d. Delayed tax

5. Which of the following can be the subject of a collection suit immediately, without the need of a
prior assessment?
a. Delinquency tax c. Both a and b
b. Deficiency tax d. Neither a nor b

6. It is defined as a delinquency tax assessment made without the benefit of a complete or partial
investigation by an authorized revenue officer.
a. Hasty assessment c. Delinquency assessment
b. Jeopardy assessment d. Impartial assessment

7. It is an official document that empowers a Revenue Officer (RO) to examine and scrutinize a
taxpayer’s books of accounts and other accounting records in order to determine the taxpayer’s
correct internal revenue tax liabilities.
a. Preliminary Assessment Notice (PAN) c. Letter of Authority (LOA)
b. Warrant of Inspection (WOI) d. Arrest Warrant (AW)

8. Statement 1: A Preliminary Assessment Notice (PAN) need not be in writing.

Statement 2: If voluntary payments are made prior to the issuance of PAN, then a PAN need not
be issued.

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 a. Only Statement 1 true c. Both statements are true
b. Only Statement 2 is true d. Both statements are not true

9. In which of the following cases will a PAN not be required?

a. There is deficiency income tax due
b. There is a mathematical error in the computation of taxes
c. In cases involving documentary stamp tax
d. When there is discrepancy between tax payable and tax due.

10. Within how many days should a taxpayer reply to the PAN
a. Ten (10) days. c. Twenty (20) days.
b. Fifteen (15) days. d. Thirty (30) days.

11. A Final Assessment Notice (FAN) shall be issued within ______ after the expiration of the period
to file the reply to the PAN or after receipt of reply to the PAN.
a. Ten (10) days c. Twenty (20) days
b. Fifteen (15) days d. Thirty (30) days

12. Was preparing her reply, Mommy Divine Company received a Preliminary Assessment Notice on
August 1, 2020. As Mommy Divine was preparing her reply, Mommy Divine already received a
Final Assessment Notice on August 11, 2020. Rule on the validity of the Final Assessment Notice.
a. The FAN is void. BIR should have waited for the reply to the PAN
b. The FAN is valid. The right to due process of Mommy Divine has been violated.
c. The FAN is valid. Mommy DIVINE’s period to file her reply expired on August 6, 2020.
d. The FAN is valid. Reply to the PAN is not mandatory in nature.

13. Within how many days should a taxpayer protest to the FAN?
a. Ten (10) days. c. Twenty (20) days.
b. Fifteen (15) days. d. Thirty (30) days.

14. Which kind of protest requires the submission of additional supporting documents?
a. Request for reconsideration c. Request for reconveyance
b. Request for reinvestigation d. Request for recognition

15. Within how many days must additional supporting documents be submitted?
a. Fifteen (15) days from filing of a request for reinvestigation.
b. Thirty (30) days from filing of a request for reinvestigation
c. Sixty (60) days from filing of a request for reinvestigation.
d. Ninety (90) days from filing of a request for reinvestigation.

16. Upon receipt of the protest in a request for reconsideration, within how many days must the
duly authorized representative or the Commissioner of Internal Revenue decide?
a. 90 days c. 150 days
b. 120 days d. 180 days

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17. It is the decision of the Commissioner of Internal Revenue on the protest of the taxpayer against
an assessment.
a. Final Decision on Disputed Assessment (FDDA)
b. Final Decision on Contested Assessment (FDCA)
c. Final Decision on Protested Assessment (FDPA)
d. Final Decision on Questioned Assessment (FSQA)

18. It is defined as the contract between the government and the taxpayer to settle the liability at a
lower amount.
a. Abatement c. Settlement
b. Compromise d. Remission

19. Which of the following is a ground for compromise?

a. Tax return of the taxpayer has been lost
b. The prescriptive period to assess taxes has already expired.
c. A reasonable doubt as to the validity of the claim against the taxpayer exists.
d. The taxpayer is out of the country and cannot be served with summons by the government.

20. What is the minimum compromise rate if the ground for compromise is financial incapacity?
a. 10% of the basic assessed tax. c. 30% of the basic assessed tax.
b. 20% of the basic assessed tax. d. 40% of the basic assessed tax.

21. In criminal tax cases, compromise should be made:

a. Before institution of criminal action c. Before conviction of a violation of tax laws
b. Before arraignment d. Before imprisonment

22. Statement 1: Civil cases already filed before the courts may no longer be the subject of
compromise.
Statement 2: Criminal tax fraud cases cannot be the subject of compromise.
a. Only Statement 1 true c. Both statements are true
b. Only Statement 2 is true d. Both statements are not true

23. When the administration and collection costs involved do not justify the collection of the
amount due, the tax due may be:
a. Compromised c. Surcharge
b. Abated d. Cancelled

24. What is the prescriptive period for assessing taxes?

a. Three (3) years from due date
b. Three (3) years from actual filing
c. Three (3) years from due date or actual filing, whichever is earlier
d. Three (3) years from due date or actual filing, whichever is later

25. What is the prescriptive period in cases of fraudulent filing?

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 a. Ten (10) years from due date or actual filing, whichever is earlier
b. Ten (10) years from due date or actual filing, whichever is later.
c. Ten (10) years from discovery of fraud.
d. Ten (10) years from commission of fraud.

26. Mimiyuuh Company filed its annual income tax return for the calendar year 2020 on April 12,
2021. The BIR assessed Mimyuuh of deficiency taxes on April 14, 2024, without alleging fraud.
Mimiyuuh, in its protest, contended that the period for BIR to assess has already prescribed. Is
Mimiyuuh correct?
a. Yes, the right of BIR to assess has prescribed on April 12, 2023.
b. Yes, the right of BIR to assess has prescribed on April 12, 2024.
c. No. the right of BIR to assess will only prescribe on April 15, 2024.
d. No, the right of BIR to assess will only prescribe on April 15, 2025.

27. Harry Potter Company filed its donor’s tax return for a donation made on March 1, 2020, on
March 20, 2020. On April 13, 2020, Harry Potter Company filed an amended donor’s tax return
declaring a gross gift which is 40% greater than the previously declared gross gift. When is the
last day for BIR to assess Harry Potter Company for deficiency donor’s tax assuming there is no
fraud?
a. March 1, 2023. c. March 31, 2023.
b. March 20, 2023. d. April 13, 2023.

28. When is an amendment of a return considered substantial?

a. When there is under declaration exceeding 20%
b. When there is under declaration exceeding 25%
c. When there is under declaration exceeding 30%
d. When there is under declaration exceeding 40%

29. Statement 1: If the taxpayer cannot be located in the address given to him in his return, the
period of prescription is tolled.
Statement 2: If the taxpayer is out of the Philippines, the period of prescription is tolled.
a. Only Statement 1 true c. Both statements are true
b. Only Statement 2 is true d. Both statements are not true

30. A final decision on disputed assessment (FDDA) may be the subject of a Petition for Review
within:
a. 30 days from the issuance of decision
b. 30 days from receipt of the taxpayer of the FDDA
c. 60 days from the issuance of decision
d. 60 days from receipt of the taxpayer of the FDDA

31. Statement 1: A void assessment renders the FDDA void.

Statement 2: A void FDDA renders the assessment void.
a. Only Statement 1 true c. Both statements are true

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 b. Only Statement 2 is true d. Both statements are not true

32. A Petition for Review against a FDDA shall be filed with

a. A Division of the Court of Appeals c. A Division of the Court of Tax Appeals
b. Court of Appeals en banc d. Court of Tax Appeals en banc

33. The Court of Tax Appeals is composed of a Presiding Justice and ________ associate Justices.
a. Seven c. Nine
b. Eight d. Ten

34. Upon notice of an adverse decision by the Court of Tax Appeals Division, the taxpayer must file:
a. A Petition for Review within 15 days to the Court of Tax Appeals en banc.
b. A Petition for Review within 30 days to the Court of Tax Appeals en banc.
c. A Motion for Reconsideration or Motion for New Trial within 15 days to the Court of Tax
Appeals Division.
d. A Motion for Reconsideration or Motion for New Trial within 30 days to the Court of Tax
Appeals Division.

35. If the decision of the Court of Tax Appeals en banc is adverse to the taxpayer, the taxpayer may
lodge an appeal with:
a. Court of Appeals c. International Criminal Court
b. Supreme Court d. Court of Heaven

36. Fearless Corporation received an assessment notice from the Bureau of Internal Revenue on 9
April 2021, assessing the corporation of deficiency income taxes for taxable year 2017. Fearless
Corporation follows the calendar year, and Fearless Corporation has filed its annual income tax
return for year 2017 on 7 7 April 2018. The Bureau of Internal Revenue has sent the assessment
notice on 5 April 2021 but was only received by the taxpayer 9 April 2021. Has the assessment
prescribed?
a. Yes. The assessment has prescribed on 7 April 2021, and the taxpayer was only able to
receive the assessment notice on 9 April 2021.
b. No. The assessment is set to prescribe on 7 April 2021, and the BIR was able to send the
assessment notice on 5 April 2021.
c. No. The assessment is set to prescribe on April 15, 2021, and the taxpayer was able to
receive the assessment notice on April 9 2021.
d. No. The assessment is set to prescribe on 15 April 2021, and the BIR was able to send the
assessment notice on 5 April 2021.

37. The rate of interest for late payment of taxes is set by law at:
a. The legal interest rate c. Six (6) percent
b. Twelve (12) percent d. Twenty (20) percent

38. What are the two kinds of interest under the Tax Code?
a. Deficiency and deficit interest c. Delinquency and demerit interest

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 b. Deficiency and delinquency interest d. Delinquency and deficit interest

39. The computation of deficiency interest is reckoned from:

a. Deadline for the payment of the tax due c. Finality of the assessment
b. Receipt of assessment notice d. Receipt of the FDDA

40. All of the following would necessitate the imposition of the 50% surcharge, except:
a. Willful neglect to file the return within the period prescribed
b. False return is willfully made
c. Fraudulent return is willfully made
d. Failure to file with the proper internal revenue officer.

41. The income tax returns must be filled in (RPCPA)

a. Duplicate c. Triplicate
b. Quadruplicate d. Quintuplicate

42. It is an official document that empowers a revenue officer to examine and scrutinize a taxpayer’s
books of accounts and other accounting records, in order to determine the taxpayer’s correct
internal revenue tax liabilities.
a. Preliminary Assessment Notice c. Audit engagement letter
b. Final Assessment Notice d. Letter of Authority

43. Before a Final Assessment Notice (FAN) is issued, the taxpayer is required to respond to the
Preliminary Assessment Notice within a period of
a. 30 days c. 45 days
b. 15 days d. 6 months

44. On July 31, 2022, Esperanza received a Preliminary Assessment Notice (PAN) from the BIR
demanding that she pays ₱180,000 deficiency income taxes on her 2020 income. How many
days from July 31, 2022 should Esperanza respond to the notice?
a. 180 days c. 60 days
b. 30 days d. 15 days

45. Anthonknia filed her 2020 Income Tax Return and paid the tax due thereon on April 1, 2021. In
case of deficiency, the last day for the Bureau of Internal Revenue to send a Final Assessment
Notice is
a. April 1, 2024 c. April 15, 2024
b. April 15, 2025 d. April 15, 2031

46. Mr. Lacson filed an income tax return for the calendar year 2022 on March 10, 2023. The BIR
assessed a Deficiency income tax on April 10, 2025. When is the last day for the BIR to make a
Formal Letter of Demand?
a. April 15, 2026 c. April 15, 2025
b. April 10, 2025 d. March 10, 2026

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47. Carlos filed his Income Tax Return (ITR) for taxable year 2022 on May 2, 2023. After an
investigation, it was discovered that the tax paid was deficient. The last day for the BIR to send
an assessment is
a. April 15, 2026 c. May 2, 2030
b. May 2, 2026 d. April 15, 2030

48. Mr. Tarde filed his 2022 income tax return on June 30, 2023. The BIR discovered a deficiency
income tax on August 15, 2024. When should the deficiency tax assessment be served?
a. On or before August 15, 2027 c. On April 15, 2026
b. On or before June 30, 2026 d. On or before April 15, 2026

49. Mia, a compensation income earner, filed her income tax return for the taxable year 2022 on
March 30, 2023. On May 20, 2026, Mia received an assessment notice and letter of demand
covering the taxable year 2022 but the postmark on the envelop shows April 10, 2026. Her
return is not a false and fraudulent return. Can Mia raise the defense of prescription?
a. No. The 3-year prescriptive period started to run on April 15, 2023, hence, it has not yet
expired on April 10, 2026.
b. Yes. The 3-year prescriptive period started to run on April 15, 2023, hence, it had already
expired by May 20, 2026.
c. No. The prescriptive period started to run on March 30, 2023, hence the 3-year period
expired on April 10, 2026.
d. Yes. Since the 3-year prescriptive period started to run on March 30, 2023, it already expired
by May 20, 2026.

50. The income tax payable (net of withholding tax of ₱29,500) in the 2022 tax return of Lito is
₱3,950. He filed the return on April 8, 2023. Assuming he paid the balance in the return on June
28, 2023, the last day for the BIR to make an assessment is
a. June 28, 2026 c. July 15, 2026
b. April 15, 2026 d. April 8, 2026

51. On March 5, 2020, the BIR discovered a deficiency value-added tax for the quarter ended
September 2013. The deficiency did not arise from error or fraud. Which of the following
statements is correct?
a. The BIR must send the assessment notice before March 5, 2023.
b. The BIR has no more remedies since the right of the government to file an action had
already prescribed.
c. The BIR must and the assessment notice before September 10, 2023.
d. The BIR must and the assessment notice before March 5, 2030

52. Cristina filed her 2021 Income Tax Return on April 10, 2022. On June 20, 2022, she filed an
amended return which is substantially different from the original return. The last day to release,
mail or send an assessment is
a. April 10, 2025 c. June 20, 2025
b. April 15, 2025 d. June 20, 2022

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53. The amount of tax still due (net of withholding tax of ₱20,000) in the 2022 tax return of Early is
₱3,560. She paid said amount upon filing of the return. On May 12, 2024 she filed an amended
the return which is not substantially different from the original. If the last day for the BIR to
make an assessment is April 15. 2026, the original return must have been filed by Early on
a. May 12, 2023 c. July 15, 2023
b. June 14, 2023 d. April 8, 2023

54. What is the effect on the tax liability of a taxpayer who does not protest an assessment for
deficiency taxes?
a. The taxpayer may appeal his liability to the CTA since the assessment is a final decision of the
Commissioner on the matter.
b. The BIR could already enforce the collection of the taxpayer’s liability if it could secure
authority from the CTA.
c. The taxpayer’s liability becomes fixed and subject to collection as the assessment becomes
fixed and subject to collection as the assessment becomes final and collectible.
d. The taxpayer’s liability remains suspended for 180 days from the expiration of the period to
protest.

55. Cosa filed a fraudulent income tax return for the year 2021 on April 11, 2022. The Bureau of
Internal Revenue discovered the fraud on February 20, 2023. The last day for the BIR to collect or
to send an assessment notice is
a. April 11, 2025 c. April 15, 2023
b. April 15, 2025 d. February 20, 2033

56. In the preceding question, suppose the BIR sent a notice of assessment on the deficiency income
tax on April 4, 2023, the last day for the BIR to collect the deficiency income tax is on
a. April 4, 2028 c. February 20, 2033
b. April 15, 2028 d. April 4, 2023

57. The running of the prescriptive period for assessment is not suspended
a. When the taxpayer files a Request for Reinvestigation which is granted by the Commissioner
of Internal Revenue.
b. When the taxpayer is out of the Philippines
c. When the warrant of distraint has been duly served upon the taxpayer and no property
could be located.
d. If the taxpayer informs the Commissioner of any change in address.

58. Upon receipt of a Final Assessment Notice/Formal Letter of Demand if the taxpayer finds out
that his facts and legal basis were incorrectly evaluated, he must file an administrative protest
known as
a. Request for Reconsideration c. Request for Compromise
b. Request for Reinvestigation d. Appeal to Court of Appeals

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59. If in August 4, 2024 the taxpayer filed a Request for Reconsideration instead of Request for
Reinvestigation, the supporting documents should be submitted to the BIR not later than
a. October 4, 2024 c. October 3, 2024
b. October 2, 2024 d. No documents to be submitted

60. Date of filing 2021 ITR May 12, 2022

Received assessment of deficiency income tax October 10, 2023
Protest was filed October 30, 2023
Submission of supporting documents December 5, 2023
Received denial of protest April 20, 2024
The last day to appeal the decision of the BIR to the Court of Tax Appeals is
a. June 4, 2024 c. May 19, 2024
b. May 20, 2024 d. June 20, 2024

Number 61 through 63 are based on the following:

Date of filing the income Tax Return March 28, 2022
Date Formal Letter of Demand was received July 20, 2024
Request for Reinvestigation was filed August 4, 2024
61. Protest or Request for Reinvestigation should be filed not later than
a. August 20, 2024 c. September 18, 2024
b. September 20, 2024 d. August 19, 2024

62. The last day for the taxpayer to submit relevant supporting documents is
a. October 4, 2024 c. October 2, 2024
b. August 20, 2024 d. October 3, 2024

Number of days allowed 60

Less: Days before due month
August (31 -4) 27
September 30 57
th
60 day: October 3
63. Assuming that the taxpayer submitted the documents supporting his motion on August 26, 2024.
The Bureau of Internal Revenue should act on the protest not later than
a. September 26, 2024 c. February 26, 2024
b. April 15, 2025 d. February 22, 2025
th
The 180 day is computed as follows
Number of days allowed 180
Less: Days before due month
August (31 – 26) 5
September 30
October 31
November 30
December 31
January 31 158

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 180th day is February 22
64. As a general rule, within what period must a taxpayer elevate to the Court of Tax Appeal a denial
of his application for refund of income tax overpayment?
a. Within 30 days from receipt of the Commissioner’s denial of his application for refund.
b. Within 30 days from receipt of the denial which must not exceed 2 years from payment of
income tax.
c. Within 2 years from payment of the income taxes sought to be refunded.
d. Within 30 days from receipt of the denial or within two years from payment.

65. Amount of tax per ITR ₱30,000

Withholding tax 20,000
1st installment payment March 28, 2023
2nd installment July 1, 2023
Last day to claim refund ?

a. March 28, 2025 c. July 1, 2025

b. April 15, 2025 d. July 1, 2026

66. Date of tax erroneously paid April 15, 2022

Date of claim for refund was filed with BIR February 18, 2023
Date of BIR decision of denial was received March 5, 2024
The last day to appeal to the Court of Tax Appeals is
a. April 4, 2024 c. April 5, 2024
b. April 4, 2023 d. April 15, 2024

67. Date of tax erroneously paid June 20, 2020

Claim for refund was filed with the BIR January 17, 2022
Received BIR decision of denial June 3, 2022
The last day to appeal to the Court of Tax Appeals is
a. July 3, 2022 c. April 15, 2022
b. June 20, 2022 d. December 3, 2022

68. The last day for the taxpayer to claim refund if the tax was paid in two installments is
a. Two years from the date of first installment payment.
b. Two years from the date of second payment
c. Five years from the date of first installment payment
d. Five years from the date of second installment payment

69. The seizure by the government of real property and interest on rights to property of the taxpayer
to enforce the payment of taxes followed by its public sale.
a. Confiscation c. Forfeiture
b. Distraint d. Levy

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70. The remedies of distraint and levy cannot availed of where the amount of tax involved is not
more than
a. ₱ 1.00 c. ₱ 100.00
b. ₱ 10.00 d. ₱ 1,000.00

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