ATCA RESEARCH

ATCA definition - http://www.bir.gov.ph/images/bir_files/old_files/pdf/83432RMO

%20No%2011-2014.pdf
Instances when ATCA should be issued by Assistant Commissioner http://www.bir.gov.ph/images/bir_files/internal_communications_4/RDAO%20No.
%202-2014_FT.pdf
Provisional Tax Clearance for Bidding, Requirements:
http://taxacctgcenter.org/provisional-tax-clearance-for-government-bidding-inphilippines/

TAX COMPROMISE RESEARCH

Jeopardy assessment shall refer to a tax assessment made without the benefit of
a complete or partial audit by an authorized revenue officer.
Under Sec. 204 of the Tax Code, a taxpayer can avail of a compromise with the government
if a reasonable doubt to the validity of the claim exists or the financial position of the
taxpayer demonstrates a clear inability to pay the assessed tax.
Compromise of tax deficiencies is discretionary upon the BIR and approval is based on facts
and circumstances.
The contesting taxpayer would need to formally file an application and submit supporting
documentation that the BIR would deem necessary to establish the basis of the compromise.
Revenue Regulations No. 30-2002 , as amended provide for specifi c instances
when it can be said that there is doubtful validity in the tax assessment or
fi nancial incapacity on the part of the taxpayer. These instances, while
numerous, are rather specifi c in nature and must be clearly proven by the
taxpayer. Furthermore, it is now required that the taxpayer fi rst pay the
compromise off er upon the fi ling of the application, and no application
for compromise shall be processed without the full settlement of the
off ered amount.

ABATEMENT

On the other hand, the same provision states that abatement or cancelation of
tax liability may be made when the tax or any portion thereof appears to be
unjustly or excessively assessed or the administration and collection costs
involved do not justify the collection of the amount due.
It is clear from the Tax Code provisions that compromise will involve the
payment of an amount prescribed by law and regulations; while abatement
means there will be no payment involved, as it ultimately cancels out
any liability.

AUTHORITY TO ABATE OR CANCEL

As a rule, only the Commissioner of Internal Revenue has the power to compromise or
abate taxes.
Compromise. However, compromise off ers involving basic taxes of P500,000 or less are
subject to the approval of the BIR Regional Evaluation Board. Where the basic tax
involved exceeds P1 million, or where the settlement is less than the prescribed
minimum rates, approval shall be made by the National Evaluation Board. Where the
compromise off er is not approved by the Commissioner of Internal Revenue, it is
imperative that the offi cers who accepted and approved the compromise off ers are only
those who are expressly authorized to do so. In the absence of proof that the
compromise off er was approved and accepted by offi cers who are authorized by the
Commissioner, the same can be disregarded [Security Bank Corp. vs. Commissioner of
Internal Revenue (G.R. No. 130838, promulgated Aug. 22, 2006)].
Abatement. The same, however, is not the case for abatement of a tax liability.
Revenue Regulations No. 13-2001 expressly provide that the Commissioner of Internal
Revenue has the sole authority to abate taxes, penalties, or interest. Unlike compromise
off ers, such authority has not been delegated by pertinent regulations. This authority is
generally applicable to surcharge and compromise penalties only. However, in
meritorious instances, the Commissioner may likewise abate the interest as well as basic
tax assessed.
Based on these regulations, it goes without saying that the approval of any compromise
and abatement is within the judgment and discretion of the Commissioner of Internal
Revenue, or any other authorized offi cer, as the case may be.