TAX 1 1. The Supreme Court ruled that taxpayers owe honesty to government just as government owes fairness to taxpayers in the case of (Gen. Prin) a. Comm Commis issi sione onerr vs. vs. Alg Algue ue b. !" #amily Savings an$ vs. Court of Appeals Appeals c. Commis Commissio sioner ner vs. vs. To$ To$yo yo shipp shipping ing Co. Co. d. !hilippine !hilippine %uaranty %uaranty Co. "nc. "nc. vs. vs. Commi Commission ssioner. er.
principle ple on progre progressi ssivit vity y in taxati taxation on is premis premised ed on the follow following ing object objective ive&& 2. The princi 'rephrase( (Gen. Prin) a. to avoid avoid regr regress essive ively ly in in taxat taxation ion b. encourage economic growth c. incr increa ease sed d rev reven enue ue d. reduce reduced d social social ine)ua ine)ualit lity y. 3. The ruled that while taxes are intended for general benefits* special benefits to taxpayers are not re)uired is pursuant to (Gen. Prin) a. gene genera rall welf welfar aree test test b. purpose test c. bene benefi fit+ t+pr prot otec ecti tion on theo theory ry d. lifeblood 4. The exercise of the power to tax by the government is so awesome* plenary* supreme* comprehensive and unlimited as cited in the case of (Gen. Prin) a. ,cCu ,cCull lloug ough h vs. vs. ,ary ,aryla land nd b. !anhandle -il Co. vs. ,ississippi c. ,oor ,oor vs. vs. Alton d. eaver aver vs. vs. Sco Scott tt 5. The jurisprudence that when the transaction itself is the one that is tax+exempt* but through error the seller pays the tax and shifts the same to the buyer* the seller gets the refund* but must hold it in trust for the buyers bu yers was established in the case of (Gen. Prin) a. !hili !hilippi ppine ne Acet Acetyl ylene ene Co. Co. vs. vs. Comm Comm.. b. Commissioner vs. %otano c. ,ace ,aceda da vs. vs. ,ac ,acar arai aig g d. Collec Collector tor vs. Ameri American can /ubb /ubber er Co. Co. 6. hen hen the the clas classi sifi fica cati tion on for for taxa taxati tion on is prom prompt pted ed by a spir spirit it of hospi hospita tabi bili lity ty or discrimination* the same is violativeof (Gen. Prin) a. due due pro proce cess ss of law law b. e)ual protection of law c. unif unifor ormi mity ty of taxa taxati tion on d. publ publiic pur purpo pose se 7. Condona Condonatio tion n of taxes due and payabl payablee complies with the rule on (Gen. Prin)
to the exclus exclusion ion of taxes taxes already already collected collected
a. b. c. d.
uniformity e)ual protection of law tax exem exempt ptio ion n tax am amnesty
8. "f a jeopardy assessment is issued by the "/* the recourse of the taxpayers is (Rem) a. to appeal appeal to the the Court Court of Tax Tax Appea Appeals. ls. b. file a motion for reinvestigation. c. as$ for abatem abatement ent of the the asse assessm ssment. ent. d. prot protes estt the the asse assess ssme ment nt.. 9. A party adversely affected by a resolution of a division of o f a CTA en banc can file !etition for /eview on Certiorari before the Supreme Court p ursuant to (Admin) a. /ule /ule 0 of of the the /ules /ules of Civi Civill !roce !rocedur duree b. /ule 02 of /C! c. /ule 03 03 of of /C! d. Sect Sectio ion n 4 of of /.A /.A.. 5262 5262 10. "n the case of Commissioner of "nternal /evenue vs. 7nion Shipping Co.* the final decision which was appealable to the Court of Tax Appeals Appeals was (Rem) a. when the the warrant warrant of distrain distraintt and levy levy was was served served on taxpayer. taxpayer. b. when a civil action for collection was filed by the "/ against the taxpayers. c. when there there was inaction inaction on the the part of the the "/ as to to the protest protest filed filed by the taxpaye taxpayers. rs. d. when the "/ "/ denied denied the protest protest filed filed by the the taxpayer taxpayers. s. 11. 11. The lien of the %overnment for unpaid u npaid internal revenue taxes arises when (Rem) a. the service service of warrant warrant of distrai distraint nt of personal personal propert property y was made. made. b. the tax became due and payable. c. the asses assessme sment nt become becomess final final and unapp unappeal ealabl able. e. d. there there is is a disput disputed ed asse assessm ssment ent.. 12. The remission of taxes due and payable to the exclusion of taxes already collected constitute (Gen Prin) a. clas classs leg legis isla lati tion on b. valid classification c. viol violat ativ ivee of due due proce process ss of of law law d. unif unifor orm m clas classi sifi fica cati tion on 13. henever exemption are expressly granted by organic or statute law* they are called (Gen. Prin) a. stat statut utor ory y exemp exempti tion on b. express exemption c. total otal exe exem mpti ption d. abso absolu lute te exem exempt ptio ion n 14. 8eductions for income tax purposes parta$e the nature of (Gen. Prin)
a. fringe benefits b. tax privilege c. tax exemption d. tax incentives 15. The confidentiality rule of "/ tax returns does not apply to (Admin) a. when inspection is authori9ed by the Secretary of #inance b. when re)uired by Congress in aid of legislation c. when re)uired by the -mbudsman d. in the case of tax compromise 16. "f a criminal case is filed against a taxpayer for tax evasion* the pendency of the criminal case (Rem) a. suspends the running of the prescriptive period for collection of tax. b. does not suspend the prescriptive period for collection. c. suspends the prescriptive period for the civil action only. d. merely interrupts the prescriptive period. 17. An estate tax is computed on the basis on the basis of the aggregate value of the properties left by the testator at time of death. -n what category of tax does estate tax fall: (Gen. Prin) a. real property tax b. property tax c. transfer tax d. excise tax 18. 8uring the ,arcos regime* the #iscal "ncentives /eview oard was established to recommend the restoration of tax exemption previously abolished under presidential decrees and headed by the Secretary of #inance* said move is (Gen. Prin) a. violative of due process of law. b. violative of non+impairment of contract. c. complies with due process of law. d. unauthori9ed delegation of the power to grant tax exemption. 19. #orfeited property by the ureau of "nternal /evenue under Section 22 of the Tax /eform Code of 1554 shall not be destroyed until at least (Rem) a. 1 days. b. 2; day. c. 3; days. d. < months after sei9ure. 20. "nternal revenue officers assigned to perform assessment or collection functions shall not remain in the same assignment for more than (Tax Admin) a. two years. b. five years. c. three years.
d. four years.
1. Stoc$holders may be held liable for the unpaid taxes of a dissolved corporation if it appears that the corporate assets have passed into their hands. T/7= 2. The jurisdiction of the tax court include cases involving the collection of the so+called compromises penalties. T/7= 3. The Term > -ther ,atters? within the Tax Court@s jurisdiction on cases coming from the "/ includes )uestion of unfair competition in the use of the simplified boo$$eeping records under the Tax Code. #AS= 0. ,andamus to compel the Commissioner of "nternal revenue to assess will result in judicial encroachment on executive functions. T/7= . There is no reasonable basis for exempting foreign+sourced income of non+resident citi9en as compared to resident citi9en who have pay the ordinary graduated rates. #AS= <. "t is possible that constructive distraint may be applied even if an actual tax delin)uency on the part of the taxpayers already exist. T/7= 4. !ayment of the tax due after apprehension shall constitute a valid defense in any prosecution for violation af ay provision of the Tax Code. #AS= 6. An assessment wherein the tax assessor has no power to act at all is an erroneous assessment #AS= 5. =stoppel does not apply to deprive the %overnment of its right to raise defenses even if those defenses are being raised only for the first time on appeal.T/7= 1;. "ndirect duplicate taxation is also $nown as obnoxious taxation. #AS= 11. The running of the prescriptive period is not interrupted by a re)uest for reconsideration if the re)uest does not advance new grounds not previously alleged. T/7= 12. hile the right to appeal a decision of the Commissioner if "nternal /evenue to the tax court is merely a statutory remedy* nevertheless the re)uirement that it must be brought within thirty days is jurisdictional. T/7= 13. The e)uali9ation of assessments by a central body is not within the realm of legislative power and may therefore be delegated to administrative body. T/7=
10. "n the >Tolentino =+BAT? case* it was upheld that the imposition of the BAT on sales and leases of real estate by virtue of contracts entered into to the affectivity of the BAT law violated the non+impairment of contracts rule in the Constitution. #AS= 1. A "/ ,emorandum Circular parta$es the nature of regulation within the contemplation of the Tax Code and therefore needs publication in order to be effective. #AS=
TAX 2 1. An increase in the value of property is considered (Gen. Prin) a. income b. assessed value c. economic benefit d. unreali9ed increase in capital 2. #or income tax purposes* an alien is considered a resident or non+resident depending on (Income Tax) a. documents issued by the ureau of "mmigration. b. having relatives in the !hilippines. c. being a student in a !hilippines university. d. intention as to the length and nature to stay. 3. A ,emorandum of Agreement was entered into between Active and /ealty "nc. 'A/"( and Active !roperties "nc. 'A!"( providing for the construction of an office tower at uendia Avenue across /eposo Street* ,a$ati to be jointly owned by them on a <;+ 0; basis to be leased out between the two corporations on the basis of their corresponding contribution. The arrangement is (Income Tax) a. an informal partnership b. corporate entity c. tax+exempt joint venture d. taxable joint venture 4. 7nder the D"/C* the ,inimum Corporate "ncome Tax ',C"T( is payable on a (Income Tax) a. monthly basis b. )uarterly basis c. taxable year basis d. semi+annual basis 5. 8ividends remitted to the head office of a resident foreign corporation by a domestic corporation are considered (Income Tax) a. branch profits subject to branch profits remittance tax b. dividends subject to 3; final withholding tax under the Tax Code or a tax treaty c. dividends subject to regular income tax d. tax exempt dividend 6. Compensation for damages for personal injuries represents payment for loss of expected profits is (Income) a. taxable income b. tax+exempt income c. income enjoying preferential tax treatment d. an exclusion
7. 7nder Section 2'.2(* dividends received by a non+resident alien not engaged in trade or business in the !hilippines are subject to 'Income) a. regular income tax of 32 b. final tax of 1; c. final tax of 2 d. final tax of 1 8. The law which provides tax exempt retirement pay to )ualified private employees in the absence of any retirement plan in the establishment is a. /.A. Do. 0514 b. !.8. Do. 22; c. /.A. Do. 4<01 d. /.A. Do. 6020 9.
The senior citi9en@s discount being granted to )ualified to senior citi9ens on their purchase of medicines is treated by the drug store as (income) a. tax credit. b. deductible cost c. input BAT for BAT purposes d. exclusion
10. 7nder the Tax Code* securities becoming worthless is treated as (income) a. ordinary asset transaction b. capital asset transaction c. wash sale transaction d. e)uity loss 11. Amounts paid for an agreement not to compete in trade or business where the taxpayer can prove the existence of such an agreement are considered (Income) a. ordinary and necessary business expenses b. cost of goods sold c. disturbance compensation d. capital expenditure 12. The premium of payment for health andEor hospitali9ation insurance which is the only deduction allowed for compensation earners applies only to families which has a gross annual income of not more than (Income) a. !2;*;;; b. !2;;*;;; c. !3;;*;;; d. !3;*;;; 13. /eal and other properties owned or ac)uired '/-!-A( by a ban$ which were ac)uired through foreclosure of properties of delin)uent client+borrowers are considered (Income) a. capital assets b. ordinary assets
c. ban$s@ property and e)uipment d. ban$s fixed assets for operation 14. 8istribution of li)uidating dividends in li)uidation of corporations is (income) a. an ordinary asset transaction b. a capital asset transaction c. sale of business assets d. exchange of business assets 15. A method developed by the "/ to examine a taxpayer@s income is such method wherein the e)uivalent of a ration analysis of percentages considered typical of the business under investigation is being used to indicate potential sources of revenue where revenue records do not exist. This method is called (Tax Admin) a. benchmar$ method b. ratio analysis method c. industry code method d. percentage method 16. The property* rights* and obligation of a person which are not extinguished by his death and also those which have accrued thereto since the opening of the succession is called (E!a!e Tax) a. estate b. assets and liabilities c. net worth d. liabilities and e)uities 17. The amount of interest on foreign loans contracted on or after August 1* 156< is subject to (Income) a. regular income tax b. 1 final withholding tax c. 2; final withholding tax d. 1; final withholding tax 18. The amount of royalties on boo$s as well as other literary wor$s and royalties on musical compositions shall be subject to (Income) a. regular income tax b. tax exempt c. final tax of 2; d. final tax of 1; 19. "f a holder of a long+term deposit or investment certificate preterminates the same and gets the proceeds thereon whereby the remaining maturity thereof is 3 years to less than 0 years* a final be imposed on the entire income at the rate of (Income) a. b. 2; c. 12
d. 1; 20. "n case of charitable contribution of property other than money* the basis of the deduction for income tax purposes is (Income) a. fair mar$et value b. assessed value c. ac)uisition cost d. boo$ value 21. Capital gains from the sale of shares of stoc$ not traded in the stoc$ exchange for gains not over !1;;*;;; shall be taxed at (Income) a. 1; b. c. 2; d. 4. 22. The ranch !rofits /emittance Tax of 1 remitted by a branch to its head office is based on the total profits (Income) a. boo$ed in the branch b. profit remaining in the branch c. profit actually remitted by the branch d. profits applied or earmar$ed for remittance for repatriation 23. The need to gross up the monetary value of the fringe benefit received in computing the fringe benefit tax due thereon is because (re"#rae) (Income) a. the tax is an additional benefit to the employee b. to comply with the ithholding on ages /egulations c. to consolidate the benefit with the salary d. of the absence of the convenience of the employer rule 24. X! Corporation owns 1;; of FTG Corporation. FTG Corporation in turn owns Heta Corporation. Heta Corporation has D-C-. Heta Corporation is merged into FTG Corporation. The D-C- of Heta Corporation should be (Income) a. retained and transferred FTG Corporation. b. considered forfeited due to the merger . c. utili9ed by Heta Corporation. d. allowed to transfer if there is a "/ ruling on the merger 25. hen a corporation is subject to the ,inimum Corporate "ncome Tax ',C"T( in any taxabe year during the three+year period for D-C- utili9ation* the running of the three+ year period for the D-C- expiry is (Income) a. interrupted b. suspended c. not interrupted d. extended
26. A #ilipino citi9en who wor$s in runei from ,onday to #riday and spends his wee$ends and a <+wee$ vacation leave in the !hilippines is considered a (Income) a. resident #ilipino citi9en b. #ilipino -verseas Contract or$er c. non+resident #ilipino citi9en d. #ilipino tourist 27. A system where the tax treatment views indifferently the tax base and generally treats in common all categories of taxable income of the taxpayer is called (Gen Prin) a. unitary tax treatment b. global treatment c. absolute income taxation system d. modified income tax system 28. Cash pri9es won by local playersEparticipants in golf tournaments are considered (Income) a. business income b. regular income c. passive income d. compensation income 29. "ncome derived by the taxpayer from the distribution of the licensed computer systems to !hilippine ban$s and the performance of support service is considered (Income) a. passive income b. ordinary business income c. royalty income d. Batable income 30. A non+resident owner of vessel or lessor on their gross rentals* lease or charter fees from leases or charterers to #ilipino citi9ens as approved by the ,aritime "ndustry Authority is subject to a tax of (income) a. 4 I b. 0 I c. 2 I d. 31E2
1. A reverse repurchase agreement between the ang$o Sentral ng !ilipinas and any authori9ed agent ban$ is a deposit substitute. T/7= 2. The allocation of the condominium units and the issuance of the corresponding Condominium Certificate of Title by the register of 8eeds to the co+venturers covering their participating interests are taxable events. #AS= 3. A deed of reconveyance with assumption of mortgage is subject to capital gains tax. T/7= 0. An expropriation sale is not subject to capital gains tax. #AS=
. The capital gains tax paid in a foreclosure sale cannot be deducted from the capital gains tax on the sale of the property where the mortgagor failed to exercise his right of redemption. T/7= <. "n case of expropriation by the %overnment* the actual consideration may be used as basis in determining the capital gains tax. T/7= 4. A partner@s share in the net profits of a general professional partnership is considered compensation income. #AS= 6. The provision on branch profit remittance tax had been interpreted by the "/ to mean that the tax base upon which the tax shall be imposed is the profit actually remitted abroad. #AS= 5. 7nder section 25* if the C"/ determines that a corporation was formed for the purpose of avoiding the progressive rates of tax on individuals* the burden of proving the determination wrong is on the Commissioner. #AS= 1;. #or purposes of #T* in case the employee is a resident alien* the gross monetary value is determined by dividing its actual monetary value by percentage factor of <4 effective year 2;;;. #AS= 11. Capital expenditures are not considered ordinary and necessary expenses. T/7= 12. The electric energy consumption tax is a non+deductible expense. #AS= 13. Shrin$age in value of securities is a deductible expense from gross income. #AS= 10. Capital losses are allowed to be deducted from other income of the taxpayer. #AS= 1. 7nder section 0; of the tax code* in case of property ac)uired for less than an ade)uate consideration * the basis is the amount paid by the transferee for the property. T/7= 1<. #or purposes of the imposition of the < capital gains tax under section 20'd( of the tax code* the properties exchanged need not be essentially different from each other. T/7= 14. 7nder the substituted filing rule* >substituted filing? is the same as >non+filing?. #AS= 16. "nterest payments for loans and other borrowings are subject to expanded withholding tax. #AS= 15. The duty to withhold tax is similar to the duty to pay income tax. #AS= 2;. !roperty dividends are subject to capital gains tax. #AS=
TAX 1 1. The official action of an examiner of the ureau of "nternal /evenue in determining the correctness of the tax due from a taxpayer is referred to as& (Tax Admin) a. Tax =xamination b. Tax Audit c. Tax Assessment d. Tax ,apping 2. hen a taxpayer ta$es the initiative of preparing and filing his tax return with the ureau of "nternal /evenue* the same is referred to as& (Tax Admin) a. Tax compliance b. Tax initiative c. "nternal assessment d. Self assessment 3. "f after a tax investigation* the "/ examiner found out that the tax paid by the taxpayer upon filing his tax return is short of what should have been paid under the law* the tax payer is liable for& (Tax Admin) a. Tax avoidance b. Tax evasion c. 8eficiency assessment d. 8elin)uency assessment 4. hen the "/ examiner issued an assessment which was not bac$ed up by the full audit and only for the purpose of beating the prescriptive period* the assessment is called& (Tax Admin) a. Boid assessment b. "llegal assessment c. =rroneous assessment d. Geopardy assessment 5. hen a tax assessment issued by the ureau of "nternal /evenue is administratively protested within thirty '3;( days from the receipt of the assessment* the assessment is called& (Tax Admin) a. Administrative assessment b. !reliminary assessment c. 8isputed assessment d. #inal assessment 6. The rule of >Do =stoppel Against the %overnment> means that& (Tax Admin) a. the government is always presumed correct in performing its tax assessment functionsJ b. the taxpayer failed to rebut the tax findings of the government uncovered during tax examination c. the government is not liable for the neglect of its agents and officers
d. the government cannot be hampered in doing its tax collection duties. 7. The power of the commissioner of "nternal /evenue to obtain information from third parties in determining the tax liability of a taxpayer covers information coming from& (Tax Admin) a. -ther government offices b. "nformers c. Tax returns filed by the taxpayer d. All persons both government and private 8. A material factor in resolving )uestions of prescription in the assessment of taxes is& (Tax Admin) a. Complete submission of all the attachments to the tax returnsJ b. #iling of the tax return in the right venue c. Kaving the tax return stamped received by the "/ authori9ed receiving officer d. The date of the filing of the tax return. 9. An income tax return for taxable year 2;;5 was filed on Ganuary 1* 2;1;. prescriptive period for assessment is& (Tax Admin) a. Ganuary 1* 2;13 b. 8ecember 31* 2;12 c. April 2* 2;13 d. April 1* 2;1
The
10. #orfeiture of property of a delin)uent taxpayer is done by the ureau of "nternal /evenue when& (Tax Admin) a. Taxpayer did not file a protest against the tax assessment b. Taxpayer does not attend an informal conference arranged by the "/ c. Taxpayer retires from business or about to leave the !hilippines d. "n a public auction of the property of a delin)uent taxpayer* no bidders bid for the property 11. A tax evasion case discovered by the "/ examiner should be filed by the latter with& (Tax Admin) a. #iscal@s -ffice b. Court of Tax Appeals c. 8epartment of Gustice d. -ffice of the "/ Commissioner 12. "f a tax or any portion thereof is unjustly assessed* the recourse of the taxpayer is& (Rem) a. To initiate an offer of compromise of the tax with the Commissioner of "nternal /evenueJ b. The file a case against the "/ examiner in the -mbudsman c. To file a damage suit in the ordinary courts d. To re)uest the Commissioner of "nternal /evenue to abate the tax liability
13. A compromise for the payment of an "nternal /evenue tax is& (Tax Admin) a. A unilateral act of the Commissioner of "nternal /evenue b. An exclusive right of the taxpayer c. A mutual agreement between the Commissioner and the taxpayer d. A right mandated by the Tax Code 14. The minimum rate for the compromise settlement of a tax liability where the taxpayer is financially incapable is& (Tax Admin) a. 1; b. 0; c. 2 d. 15. The prescriptive period for the collection of a previously assessed "nternal /evenue tax is& (Tax Admin) a. #ive '( years fallowing the assessment of the tax b. Three '3( years following the filing of the tax return c. #ive '( years following the filing of the tax return d. Ten '1;( years following the assessment of the tax 16. A re)uest for reinvestigation by the taxpayer which is granted by the Commissioner has the following effect& (Tax Admin) a. Suspends the prescriptive period for assessment b. !uts an end to an assessment c. !rescriptive period for the assessment is not affected and continues to run d. /enders the assessment final executor 17. The prescriptive period for the filing of a claim for refund or tax credit of erroneously paid internal revenue tax is& (Tax Admin) a. Two '2( years from date of payment* regardless of any supervening event b. Six '<( years from date of payment c. Two '2( years from date of payment but if there is a supervising event* two years from the date of the supervising event. d. Three '3( years from the date of payment 18. The broad spectrum of taxation includes the rule that the collection of taxes could not be stopped by the courts pursuant to the following rule& (Tax Admin) a. ifeblood Theory in Taxation b. Tax exemption policy c. Do+"njunction rule d. Theory of Decessity 19. -ne of the canons of taxation is fiscal ade)uacy. A violation of this canon would fall under the following& (Gen Prin) a. The constitutional provision that all revenue bills should originate from the Kouse of Senate may concur with amendments
b. 8ereliction of duties on the part of the ureau of "nternal /evenue c. Do breach of any constitutional provision d. The ateral Attrition aw 20. henever a violation of the Tax /eform Code of 1554 is committed by a taxpayer* an internal revenue officer can ma$e an arrest. The legal basis for this is the& (Tax Admin) a. /evised !enal Code b. Tax Code c. /ules of Court d. -mbudsman Act 21. A property may be placed under constructive distraint by the ureau of "nternal /evenue when& (Tax Admin) a. The taxpayer becomes delin)uent in the payment of internal revenue tax b. The taxpayer fails to file a protest against tax assessment c. The taxpayer may not yet be delin)uent d. The taxpayer fails to appeal to the Court of Tax Appeals 22. A taxpayer overpaid his income tax when he filed his income tax return on April 1* 2;;4. /eali9ing the overpayment* he filed a claim for refund with the "/ on Gune 1* 2;;4. Ke received the reply of the "/ denying his claim on ,ay 3* 2;;5. hat should he do with the adverse decision of the "/: (Remedie) a. #ile a ,otion for /econsideration with the "/ b. =levate the case to the Court of Tax Appeals within 3; days from ,ay 3* 2;;5 given the 3; days deadline to appeal adverse decision pursuant to /A 5262 c. Ke has lost his right to appeal d. #ile an auction with the ordinary courts for undue payment (solutio indebiti) 23. efore a case for tax evasion against a client under the Tax Code is filed* the same must be approved by the& (Tax Admin) a. Solicitor %eneral@s -ffice b. Secretary of #inance c. Commissioner of "nternal /evenue d. 8epartment of Gustice 24. "n case of doubt in a tax exemption law* which of the following rules shall govern: (Gen Prin) a. The doubt must be resolved in favor of the taxpayer since a tax is a deprivation of hard+earned money of the taxpayer. b. Do person shall be deprived of due process of law which is guaranteed by the Constitution. c. The doubt must be resolved in favor of the government. d. The legislative intention must be determined first. 25. A taxpayer filed his income tax return on April 1* 2;;6. Ke received a Dotice of Assessment on Ganuary 1* 2;;5 and shortly thereafter the "/ examiner started his
investigation of the return. 7pon /eceipt of the preliminary report of the result of the tax examination* taxpayer re)uested for investigation which was granted by the "/ on Gune 1* 2;;5 and reinvestigation was finished on 8ecember 1* 2;;5. The final assessment was only issued to the taxpayer on Gune 1* 2;11 for which the taxpayer argued that assessment has prescribed since under the 3 years+prescriptive rule under Section 2;3 of the Tax Code* the final assessment should have been issue on or before April 1* 2;11. The issue is& (Tax Admin) a. The assessment has already prescribed under section 2;3 of the Tax Code b. The assessment has prescribed because the "/ did not ta$e the initiative of re)uesting the taxpayer to file the aiver of the !rescriptive !eriod c. The assessment has not yet prescribed because it falls within the grounds under section 223 of the Tax Code d. The assessment has prescribed because the "/ did not offer to compromise the assessment with the taxpayer.
TAX 1 1. The authority of the Commissioner of "nternal /evenue to prescribed real property values is intended for the following purpose& (!ax Admin) a. Assure collection of the correct real property taxes due from property owners b. To have uniform and standard valuation of real properties and assure transparency in business transactions c. !revent undervaluation of real property values for tax purposes d. Avoid arbitrariness in the valuation of real properties. 2. The termination of a taxable period of a taxpayer is intended for the following purpose& (!ax Admin) a. To address the internal accounting needs of the "/ b. The taxpayer is retiring from business or intending to leave the !hilippines c. The taxpayer has re)uested the "/ for such move d. The business of the taxpayer necessitates such move 3. The powers vested on the Commissioner may be delegated to the following& (!ax Admin) a. 8ivision chief or higher b. Tas$ #orce of the Commissioner c. Commissioner@s confidential advisers d. =xternal consultants 4. henever the Commissioner joins inventoryLta$ing and surveillance job of taxpayers under Section < ' c ( of the Tax Code* he would need authority from& (!ax Admin) a. -rdinary courts b. Court of Tax Appeals c. Secretary of #inance d. Do need to get any authority 5. hen a warrant of %arnishment is issued by the Commissioner of internal /evenue to garnish a taxpayer@s money in the custody of a ban$* the same is a violative of& (!ax Admin) a. /epublic Act 10; ' Secrecy of an$ 8eposits( b. %eneral an$ing aws of 2;;; c. Confidentiality of an$ing Transactions d. Dot violative of the laws cited above 6. aws and regulations issued by the government concerning collection of taxes are re)uired to be published in newspapers of general circulation. #ailure to do so violates& (Gen Prin) a. "nherent limitations on taxations b. Canons of taxations c. !rivate rights of taxpayer d. Theoretical justice
7. "t has been said that in taxation* there is symbiotic relationship between the taxpayer and the government. The doctrine falls under& (Gen Prin) a. asis of Taxation b. Aspects of Taxation c. The Court of Tax Appeals d. The =valuation oard 8. "n case of a compromise of a civil liability for taxes where the basic tax exceeds -ne ,illion !esos or where the settlement offered is less than the minimum rate of 0; the compromise shall be approved by the & (!ax Admin) a. Secretary of #inance b. Commissioner of "nternal /evenue c. Court of Tax Appeals d. =valuation oard 9. A refund chec$ or warrant issued by the "/ in accordance with Section 2;0 of the Tax Code are claimable within the period of& (!ax Admin) a. Two years b. Ten years c. #ive years d. Three years 10. hen the power of the Commissioner to compromise a tax case is delegated under Section 4 of the Tax Code on cases involving basic deficiency tax of !;;*;;; or less* the same may be delegated to the& (!ax Admin) a. /egional 8irector b. Assistant /egional 8irector c. /evenue 8istrict -fficer d. /egional =valuation board 11. The Secrecy of an$ 8eposits under /epublic Act Do. 10; is automatically waived by operation of law examination of the following taxes& (!ax Admin) a. "ncome Tax b. Balue Added Tax c. =state Tax d. 8onor@s Tax 12. The Det orth ,ethod of investigation being utili9ed by the "/ in assessing taxpayers is based on the following& (Tax Admin) a. hen a person is benefit economically in life* his net worth will increase b. hen the capital account of a person increases* there is presumed income c. All persons who have assets are presumed to have income d. All persons who have source of income should have taxable income 13. -ne of the canons of taxation is theoretical justice. A violation of this canon is based on& (Gen Prin)
a. b. c. d.
The rule of uniformity and e)ual protection of law in taxation. Theory of necessity asis of taxation which is reciprocity %uarantee of due process of law
14. Ac)uittal in a criminal case for tax evasion does not carry with it the exoneration from civil obligation to pay tax is in the Tax Code (!ax Admin) a. A criminal case is governed by the /evised !enal code while the civil obligation to pay tax in the Tax Code b. A different )uantum of evidence is re)uired in a criminal case vis+M+vis a civil obligation to pay tax c. A criminal violation is sanctioned by fines and imprisonment whereas the civil obligation is exposed only to the incremental penalties for deficiency and delin)uency d. There are two separate and distinct offenses involved. 15. hich of the following situations do not re)uire a pre+assessment under the Tax Code: (!ax Admin) a. hen the taxpayer being examined re)uest for the reinvestigation of his records b. hen the taxpayer executes a waiver of the prescriptive period c. hen the excise tax due on excisable articles has not been paid d. hen the taxpayer retires from business or leave the !hilippines. 16. hen the issue in controversy between the taxpayers and the Commissioner does not involve a difficult )uestion of law or doubtful validity* the options opened to the Commissioner are as follows& (!ax Admin) a. Accept the compromise offer from the taxpayer who invo$es Commissioner@s right under Section 2;0 of the Tax Code b. Commissioner should pursue collection of the tax c. Suggest that the taxpayer appeal the case to the Court of Tax Appeals d. Suggest that taxpayer hire a tax lawyer to assist him 17. An estate tax return was filed by the administrator of an estate on Gune 1* 2;;<. The estate tax return was examined by the "/ and after underta$ing all the procedural steps for tax examination* a final assessment was issued on August * 2;1;. "t was discovered later by the "/ that the estate tax return which filed was incomplete since a big real property of the testator was not reported in the estate tax return. The taxpayer argued that since the final assessment was only issued on August * 2;1;* the assessment is already prescribed being issued beyond the 3 years period for tax examination. Choose from the following the applicable jurisprudence in the case& (!ax Admin) a. The assessment had already prescribed because the assessment was only received on August * 2;1; which beyond the prescriptive period of 3 yearsJ b. The assessment had already prescribed in as much as there was nothing done by the tax payer to suspend the prescriptive period li$e the filing of a ,otion for /einvestigation c. The assessment had not yet prescribed because the return being incomplete the 3 years prescriptive period does not apply
d. The assessment had already prescribed because the "/ did not re)uest the taxpayer to execute a aiver of !rescriptive period 18. A taxpayer filed his income tax return on April 1* 2;;<. Sometime ,arch 1. 2;;4* he discovered that he omitted a big income which should have been reported in the return filed on April 1* 2;;<. Kence* on ,arch 2* 2;;4* he filed an amendment to his income tax return. The perspective period for assessment of the tax return shall expire on& (!ax Admin) a. April 1* 2;;5 b. ,arch 2* 2;1; c. ,arch 1* 2;1; d. April 1* 2;1< 19. The >presumption of correctness? being enjoyed by the government in case of tax assessment cases means& (!ax Admin) a. The government is not stopped from the mista$es of its agents b. This is in conformity with the supremacy of the government in the collection of taxes c. The taxpayer has the burden of proof in arguing his case and prove that he is correct d. This is in line with the lifeblood theory in taxation 20. The 2 E ; surcharge being imposed on a deficiency or delin)uency assessment initiated by the "/ is based on the following rationale& (!ax Admin) a. "t is a way of compensating the government for lost revenue. b. "t parta$es the nature of li)uidated damages which the government suffered c. "t is a form of exemplary damages to deter taxpayer from violating the Tax Code d. "t is another form of raising revenue for the government 21. "n tax evasion cases* it is a rule that a precise determination of civil liability for tax is not a condition precedent for the filing of a criminal case. The rationale for this is& (!ax Admin) a. The civil and criminal liabilities are separate and distinct liabilities b. The civil liability is given preference over the criminal liability due to the lifeblood theory c. The )uantum of evidence re)uired in the criminal case is not the same as the one for the civil case d. "t ta$es time to determine the civil liability for tax of a taxpayer. 22. The Statute of imitations in taxation 'prescriptive rules( are being observed because of the following rationale& (!ax Admin) a. To align it with others laws where there are also rues on prescription b. The tax laws of the 7nited States from which the !hilippine Tax Code was patterned have rules governing prescription c. To ma$e the government vigilant in complying with their duties of tax examination and to give peace of mind to taxpayers d. ,any of the tax laws of other countries in world have rules on prescription
23. The arrant of distraint and levy being issued by the "/ to enforce collection of taxes can only be initiated b y the "/ under the following conditions a. To align it with other laws where there also rules on prescription b. The tax laws of the united states from which the !hilippine tax code was patterned have rules governing prescription c. To ma$e the government vigilant in complying with their duties of tax examination and to give peace of mind to taxpayers d. ,any of the tax laws of other countries in the world have rules on prescription. 24. 7pon examination of an income tax return by a "/ examiner* the taxpayer re)uested for information on the items which had been disallowed by the "/ examiner which was granted by the latter. The effect of giving due course to taxpayer@s re)uest is& (!ax Admin) a. to suspend the running of the prescriptive period b. the prescriptive period shall continue to run c. the assessment will be suspended d. there is no effect on the prescriptive period 25. -ne of the basic principles of a sound tax system is administrative convenience. "f this is not complied with* the following rule is violated& ($en Prin) a. 8octrine of =xhaustion of Administrative /emedies b. 8ue process of law c. Do violation committed d. =)ual protection law
