RR 12-85

REVENUE REGULATIONS NO. 12-85 SUBJ SUBJEC ECT T : Proc Proced edur uree cover coverin ing g admi admini nist stra rati tive ve prot protes ests ts on asse assess ssme ment ntss of the the Bureau of Internal Revenue TO : All All Inte Intern rnal al Reve Revenu nuee Offi Office cers rs and and Othe Others rs Conc Concer erne ned d Pursuant to Section 326 of the National Internal Revenue Code of 1977, as amended, in relation to Section 4 of the same Code, the following following rules and regulations implementing implementing the provisions of Section Section 319-A (now 229) of the same Code introduced introduced by P.D. 1773 are hereby promulgated to govern the issuance of assessment notices as well as the adjudication of administrative protests against said assessments. POST REPORTING NOTICE SECTION 1. Post-reporting notice.  Upon receipt of the report of findings, the Division Chief, Revenue District Officer or Chief, Office Audit Section, as the case may be, shall send to the taxpayer a notice for an informal conference before forwarding the report to higher authorities for approval. The notice which is Annex "A" hereof shall be accompanied by a summary of findings as basis b asis for the informal conference. In cases where the taxpayer has agreed in writing to the proposed assessment, or where such proposed assessment has been paid, the required notice may be dispensed with. PRE-ASSESSMENT NOTICE SECTION 2. Notice of proposed assessment.  When the Commissioner Commissioner or his his duly authorized representative finds that taxes should be assessed, he shall first notify the taxpayer of his findings in the attached prescribed form as Annex "B" hereof. The notice shall be made in writing and sent to the taxpayer at the address a ddress indicated in his return or  at his last known address as stated in his notice of change of address. cdasia In cases where the taxpayer has agreed in writing to the proposed assessment, or where such proposed assessment has been paid, the required notice may be dispensed with. SECTION 3. Time to reply.  Venue for filing filing reply. reply.   (a) Regional Regional Office Office cases  The taxpayer taxpayer shall shall reply within within a period period of of fifteen fifteen (15) days from receipt of the pre-assessment notice. In meritorious cases and up on written request of the taxpayer an extension may be granted within which to respond, but in no case shall the extension exceed a total of ten (10) days. The reply of the taxpayer shall be filed with the Assessment Branch of the Regional Office which has jurisdiction over the case. (b) National National Office Office cases cases  The taxpayer taxpayer shall shall reply within within a period period of fifteen fifteen (15) (15) days from receipt of pre-assessment notice. In meritorious cases and upon written request the taxpayer may be given an extension within which to respond but in no case shall the extension exceed a total of ten (10) days. The reply of the taxpayer shall be filed with the Sector Audit Review Division or the National Audit Review Division, as the case may be, having jurisdiction over the case. With regard to pre-assessment notices sent by the Withholding Tax Division in compliance with withholding tax provisions, the same shall be filed with the Withholding Tax Division. SECTION 4. Examination of records.  In case the taxpayer responds to the notice within the above-prescribed period, he or his duly authorized representative shall be allowed to examine the records of the case and to present his arguments in writing protesting the proposed assessment. Thereafter, the Commissioner or his authorized representative shall, of the basis of the evidence on record, decide whether or not to

approve the report as a prelude to the issuance of the corresponding assessment notice. cdasia ISSUANCE OF ASSESSMENT SECTION 5. Failure to reply to to pre-assessment notices; issuance issuance of assessment. assessment.  In the event the taxpayer fails to respond to the pre-assessment notice within the above prescribed period, or when the Commissioner Co mmissioner or his duly authorized representative finds the response to be without merit, he should be informed of such fact and an d the report of  investigation shall be given due course. PROTEST TO ASSESSMENT SECTION 6. Protest.  The taxpayer may protest administratively an assessment by filing a written request for reconsideration or reinvestigation specifying the following particulars: (a) Name of the taxpayer taxpayer and address address for the immediate immediate past three (3) taxable taxable year. year. (b) Nature of request request whether whether reinvesti reinvestigation gation or reconsidera reconsideration tion specifying specifying newly discovered evidence he intends to present if it is a request for investigation. (c) (c) The The taxa taxabl blee perio periods ds cover covered. ed. (d) (d) Asse Assess ssme ment nt number number.. acd (e) Date of receipt receipt of assessment assessment notice notice or letter letter of demand. demand. (f) Itemized Itemized statement statement of the findings findings to which the taxpayer taxpayer agrees as a basis 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. (g) The itemized itemized schedule schedule of the adjustments adjustments with which the taxpayer taxpayer does not agree. agree. (h) A statement statement of facts and/or law in support support of the protest. protest. A request for reconsideration or reinvestigation of an assessment shall be accompanied by a waiver of the Statute Statute of Limitations Limitations in favor of the government. For the purpose of the protest herein   (a) Request for reconsidera reconsideration tion  refers refers to a plea of re-evaluati re-evaluation on of the assessment assessment on the basis of existing records without need of additional evidence. It may involve both b oth a question of fact or of law or both. (b) Request for reinvestig reinvestigation ation  refers refers to to a plea of re-evaluati re-evaluation on of an assess assessment ment on the basis of newly discovered or o r additional evidence that a taxpayer intends to present in the reinvestigation. It may also involve a question of fact or law or both. SECTION 7. When to file file protest  A protest must be filed filed within thirty thirty (30) days from receipt of the assessment. cdtai SECTION 8. Where to file protest  In Regional Office cases, the request for  reconsideration or reinvestigation of assessment shall be filed with the Collection Branch of the region which has jurisdiction over the case. For cases handled by the National Office, such request shall be filed with the Collection Office. SECTION 9. Finality of assessments.  If a taxpayer who receives an assessment assessment from the Bureau of Internal Revenue fails to file a protest within the period prescribed in Section 7 of these regulations, the said assessment shall be final and unappealable and the taxpayer is thereby precluded from disputing the assessment. SECTION 10. Appeals of decision d ecision of Commissioner or Regional Director of the Court of  Tax Appeals.  Final decision issued by the Commissioner or Regional Director may be

appealed to the Court Cou rt of Tax Appeals within thirty (30) days from receipt thereof, otherwise the same same shall be final final and executory. cdasia SECTION 11. Change of address.  In case of change of address, the taxpayer must give written notice thereof to the Revenue Rev enue District Officer or the district having jurisdiction over his former legal residence and/or place of business, copy furnished the Revenue District Officer having jurisdiction over his new legal residence or place of  business, the Revenue Computer Center and the Receivable Accounts Division, BIR, National Office, Quezon City, and in case of failure to do so, any communication referred to in these regulations previously sent to his former legal residence or business address as appearing in his tax return for the period involved shall be considered valid and binding for purposes of the period within which to reply.