April 2014 Philippine Supreme Court Decisions on Tax Law

Here are select April 2014 rulings of the Supreme Court of the Philippines on tax law:

National Internal Revenue Code; income tax; creditable withholding tax; refund; requisites. There are three essential conditions for the grant of a claim for refund of creditable withholding income tax, to wit: (1) the claim is filed with the Commissioner of Internal Revenue within the two-year period from the date of payment of the tax; (2) it is shown on the return of the recipient that the income payment received was declared as part of the gross income; and (3) the fact of withholding is established by a copy of a statement duly issued by the payor to the payee showing the amount paid and the amount of the tax withheld therefrom. Commissioner of Internal Revenue v. Team (Philippines) Operations Corporation (formerly Mirant Phils., Operation Corporation), G.R. No. 179260, April 2, 2014.

National Internal Revenue Code; income tax; tax credit or refund; corporations; irrevocability rule. In case the corporation is entitled to a tax credit or refund of the excess estimated quarterly income taxes paid, the excess amount shown on its final adjustment return may be carried over and credited against the estimated quarterly income tax liabilities for the taxable quarters of the succeeding taxable years. Once the option to carry-over and apply the excess quarterly income tax against income tax due for the taxable quarters of the succeeding taxable years has been made, such option shall be considered irrevocable for that taxable period and no application for cash refund or issuance of a tax credit certificate shall be allowed therefor. Commissioner of Internal Revenue v. Team (Philippines) Operations Corporation (formerly Mirant Phils., Operation Corporation), G.R. No. 179260, April 2, 2014.

Court of Tax Appeals; findings and conclusions of the CTA are accorded highest respect. The findings and conclusions of the Court of Tax Appeals (CTA) are accorded the highest respect and will not be lightly set aside. The CTA, by the very nature of its functions, is dedicated exclusively to the resolution of tax problems and has accordingly developed an expertise on the subject unless there has been an abusive or improvident exercise of authority. Consequently, its conclusions will not be overturned unless there has been an abuse or improvident exercise of authority. Its findings can only be disturbed on appeal if they are not supported by substantial evidence or there is a showing of gross error or abuse on the part of the Tax Court. In the absence of any clear and convincing proof to the contrary, the Court must presume that the CTA rendered a decision which is valid in every respect. Commissioner of Internal Revenue v. Team (Philippines) Operations Corporation (formerly Mirant Phils., Operation Corporation), G.R. No. 179260, April 2, 2014.

(Caren thanks Charles Icasiano for assisting in the preparation of this post.)

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