a. Protesting an Assessment

Protest in General

A protest is a vital document which is a formal declaration of resistance of the taxpayer. It is a repository of all arguments. It is also the formal act of the taxpayer questioning the official actuations of the CIR. This is equivalent to a pleading.

Requisites of a valid protest

A protest is considered valid if it satisfies the following conditions:

• It is made in writing, addressed to the CIR and made within the prescribed time (i.e., 30 days from receipt of the FAN);
• It contains the information required by Sec. 6 of RR No. 12-85¹, thus:
• Name of the taxpayer and address for the immediate past 3 taxable years;
• Nature of request (i.e., whether for reinvestigation or reconsideration, specifying newly discovered evidence he intends to present if it is a request for reinvestigation);
• The taxable periods covered;
• FAN number;
• Date of receipt of FAN;
• Itemized statement of the findings to which the taxpayer agrees as a basis for computing the tax due, which amount should be paid immediately upon the filing of the protest; for this purpose, the protest shall not be deemed validly filed unless payment of the agreed portion of the tax is paid first;
• Itemized schedule of adjustments with which the taxpayer does not agree; and
• Statement of facts and/or law in support of the protest. (R.R. No. 12-85, as amended by)
• R.R. No. 18-2013² reiterates that the taxpayer shall state in his protest:
• Nature of protest, whether reconsideration or reinvestigation, specifying newly discovered or additional evidence he intends to present if it is a request for reinvestigation;
• Date of the assessment notice; and
• Applicable law, rules and regulations, or jurisprudence on which his protest is based.

Effect of Non-Compliance with Requirements

Otherwise, his protest shall be considered void and without force and effect.

Request for Reconsideration v. Request for Reinvestigation

Note: Undoubtedly, a reinvestigation, which entails the reception and evaluation of additional evidence, will take more time than a reconsideration of a tax assessment, which will be limited to the evidence already at hand. This justifies why the former can suspend the running of the statute of limitations on collection of the assessed tax, while the latter cannot. (BPI v. CIR, G.R. No. 181836)⁴

Compliance with requirements to dispute an assessment – assessment not final, executory and demandable

After the company submitted its letter-reply stating that it would not comply with the presentation of the proof of DST payment, no reply was then heard from the CIR. The company has complied with the requisites in disputing an assessment, which provides that in case the protest is not acted upon within 180 days from the submission of the documents, the taxpayer adversely affected may appeal to the CTA within 30 days from the lapse of the 180-day period. Thus, the tax assessment cannot be considered as final, executory and demandable. (CIR v. First Express Pawnshop Company, Inc., G.R. No. 172045-46)⁵

Rule on Prior Payment When Protesting Assessment

General Rule: No prior payment of assessed internal revenue tax is required when protested or disputed.

Exception: when there are several issues involved but the taxpayer only disputes or protests against the validity of some of the issues raised, the taxpayer shall be required to pay the deficiency tax or taxes attributable to the undisputed issues. No action shall be taken on the taxpayer's disputed issues until the taxpayer has paid the deficiency tax or taxes attributable to the said undisputed issues. (R.R. No. 12-99)⁶