Tax Court increases Ayala tax refund claim to P97M
The Court of Tax Appeals (CTA) has partially granted the motion for reconsideration of Ayala Corporation increasing the claim for tax refund from P67 million to P97 million.
In a nine-page amended decision, the tax court’s Second Division has allowed the additional P29.4-million be added to the previously ordered refunded P67 million to the giant corporation.
“Guided by the Summary explanations [provided by Ayala Corp.], this Court was able to determine that the income of P198.4-million formed part of the taxable income reported in petitioner’s [Ayala] Annual Income Tax Returns for years 2010 and 2011,” the Tax Court said.
Therefore, the court said the corresponding creditable withholding tax (CWT) worth P29.4-million shall be refunded to Ayala Corp. “in addition to the amount of P67,742,758.85 which was previously granted in the [October 2015] decision.”
But the Tax Court denied the bid of Ayala to also claim P29.3-million additional refund because no documents were submitted to support adjustments as well as to support the gains and losses of the corporation.
In the same ruling, the Tax Court denied the motion for reconsideration filed by the Bureau of Internal Revenue (BIR) which seeks to reverse the court’s ruling granting the P67-million tax refund to Ayala.
BIR said the refund should not be granted due to Ayala’s failure to present the various payors or withholding agents to prove the fact of withholding and subsequent remittance of taxes due to the government.
“Respondent [BIR’s] argument is untenable,” the Tax Court said pointing out that Certificates of Creditable Tax Withheld at Source issued by withholding agents is enough proof of actual payment of CWT with no further need to present various payors and withholding agents…,” the Tax Court said as it cited a Supreme Court case of Banco Filipino Savings and Mortgage Bank v. Court of Appeals, CTA and Commissioner of Internal Revenue.
“The figures appearing in the CWT certificates should be taken at face value since these documents are executed under the penalties of perjury,” the Tax Court said quoting the Supreme Court ruling.
The Tax Court’s Amended Decision is written by Associate Justice Caesar Casanova and concurred in by Associate Justices Juanito C. Castañeda Jr. CDG
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