DONORS TAX

I. MEANING OF GIFT
Sec. 104, NIRC
Pirovano v. CIR, 14 SCRA 832 (1965)
II. VALUATION OF GIFTS
Sec. 102, NIRC

III. TRANSFER FOR LESS THAN

ADEQUATE CONSIDERATION
Sec. 100, NIRC

IV. EXEMPT GIFTS

Sec. 101, NIRC

V. FOREIGN TAX CREDIT

Sec. 101(C), NIRC
A. Per Country Limitation
B. Global Limitation

VI.ON WHOM IMPOSED

Sec. 98(A), NIRC

VII.ADMINISTRATIVE
A. Tax Rates
Sec. 99, NIRC

B. Donors Tax Return

Sec. 103(A), NIRC

C. Payment of Donors Tax

Sec. 103(B), NIRC

D. Consequences of Non-Payment of
Donors Tax
Secs. 248- Sec. 249, NIRC Sec. 95, NIRC
Sec. 97, NIRC

Week 3
VALUE-ADDED TAX
I. TAXABLE TRANSACTIONS
A. In General
Sec. 105, NIRC
BIR Ruling 98-97, Aug. 28, 1997
BIR Ruling No. 18-05, Sept. 16, 2005
VAT Ruling No. 444-88
VAT Ruling No. 207-90, Nov. 8, 1990
BIR Ruling No. 10-98, Feb. 5, 1998
CIR v. Commonwealth Mgt. & Services
Corp., G.R. 125355, March 30, 2000
VAT Ruling No. 26-97, April 1, 1997
Tourist Trade and Travel Corp. v. CIR, CTA
Case No. 4806, Jan. 19, 1996
BIR Ruling No. 113-98, July 23, 1998
Magsaysay Lines, Inc. v. CIR, CTA Case
No. 4353, April 27, 1992, aff. in G.R.
No. 146984, July 28, 2006
Lapanday Foods Corp. v. CIR, CTA Case
No. 7097, Oct. 18, 2007
CS Garments, Inc. vs. Commissioner of
Internal Revenue, CTA Case No. 6520
dated
January 4, 2007
Kepco Ilijan Corporation v CIR, CTA Case
No. 8091, October 23, 2012
B. Sale of Goods or Properties
1. Transactions Covered
a. Actual Sale
Sec. 106(A)(1), NIRC, as amended by
Rep. Act. No. 9337
BIR Ruling 424-2014
b. Transactions Deemed Sale
Sec. 106(B), NIRC, as amended by Rep.
Act No. 9337
Sec. 4.106-7, Rev. Regs. No. 16-2005,
Sept. 1, 2005, as amended by Rev.
Regs. No. 4-2007, Feb. 7, 2007
c. Changes in or Cessation of Status of
a VAT-Registered Person
Sec. 106(C), NIRC, as amended by Rep.
Act. No. 9337
Sec. 4.106-8, Rev. Regs. No. 16-2005,
Sept. 1, 2005, as amended by Rev.
Regs. No. 4-2007, Feb. 7, 2007

BIR Ruling No. 24-2005, Dec. 23, 2005

2. Taxable Base
a. Gross Selling Price
Sec. 106(A)(1), 2nd par., NIRC, as
amended by Rep. Act No. 9337
Sec. 4.106-4, Rev. Regs. No. 16-2005,
Sept. 1, 2005, as amended by Rev.
Regs. No. 4-2007, Feb. 7, 2007
b. Sales Discounts, Returns and
Allowances
Sec. 106(D), NIRC, as amended by Rep.
Act No. 9337
Sec. 4.106-9, Rev. Regs. No. 16-2005,
Sept. 1, 2005
VAT Ruling No. 204-90, Oct. 16, 1990
c. Taxable Base for Transactions
Deemed Sale and Below Market Gross
Selling Price
Sec. 4.106-7(b), Rev. Regs. No. 16-2005,
Sept. 1, 2005, as amended by
Rev. Regs. No. 4-2007, Feb. 7, 2007
C. Importation of Goods
Sec. 107, NIRC, as amended by Rep. Act.
No. 9337
D. Sale of Services
1. Meaning of Sale or Exchange of
Service
Sec. 108(A), NIRC, as amended by Rep.
Act. No. 9337
Sec. 4.108-2, Rev. Regs. No. 16-2005,
Sept. 1, 2005
Lhuillier v. CIR, CTA Case No. 6533, May
16, 2003
Revenue Memorandum Circular 42-2003
BIR Ruling DA 320-07
2. Taxable Base: Gross Receipts
Actually and Constructively Received
Sec. 108(A), NIRC, as amended by Rep.
Act. No. 9337
Sec. 4.108-4, Rev. Regs. No. 16-2005,
Sept. 1, 2005, as amended by Rev.
Regs. No. 4-2007, Feb. 7, 2007
BIR Ruling No. 195-89, Sept. 8, 1989
VAT Ruling No. 111-88, April 25, 1989
VAT Ruling No. 205-90, Oct. 16, 1990
a. Amounts Earmarked for Payment
to Third Parties
Sec. 4.108-4, Rev. Regs. No. 16-2005,
Sept. 1, 2005, as amended by Rev.

Regs. No. 4-2007, Feb. 7, 2007

CIR v. Tours Specialists, Inc., G.R. 66416,
March 21, 1990
BIR Ruling No. DA-069-2006, March 1,
2006
b. Reimbursement of Expenses
Sec. 4.108-4, Rev. Regs. No. 16-2005,
Sept. 1, 2005, as amended by Rev.
Regs. No. 4-2007, Feb. 7, 2007
VAT Ruling No. 283-88, July 4, 1988
VAT Ruling No. 87-88, April 14, 1988
VAT Ruling No. 97-88, April 15, 1988
Revenue Memorandum Circular 65-2012
Officemetro Philippines, Inc. (formerly
Regus Centres, Inc.) vs. Commissioner of
Internal
Revenue, CTA Case No. 8382, June 3,
2014, the Court of Tax Appeals Third
Division (CTA)
II. RELIEF FROM VAT: ZERO-RATING AND
EXEMPTIONS
A. Difference Between Zero-Rating and
Exemption
Secs. 4.106-5, 1st par., and 4.108-5(a),
Rev. Regs. No. 16-2005, Sept. 1, 2005
Cf. Sec. 4.109-1(A), Rev. Regs. No. 162005, Sept. 1, 2005
CIR v. Seagate Tech. (Phil.), G.R. 153866,
Feb. 11, 2005
Contex Corp. v. CIR, G.R. No. 151135,
July 2, 2004
B. Automatically Zero-Rated
Transactions
1. Sale of Goods and Properties
Sec. 106(A)(2)(a)(1), (2), (4) and (b),
NIRC, as amended by Rep. Act. No. 9337
Toshiba Information Equipment (Phils)
Inc. v CIR GR No. 157594, March 9, 2010
Revenue Regulations No 2-2012,
February 17, 2012
BIR Ruling DA 30-07, January 19, 2007
BIR Ruling 031-07 January 19, 2007
2. Sale of Services
Sec. 108(B)(1), (2), (6) and (7), NIRC, as
amended by Rep. Act. No. 9337
CIR v. American Express Intl, Inc. (Phil.),
G.R. 152609, June 29, 2005

CIR v. Burmeister & Wain Scandinavian

Contractor Mindanao, Inc., G.R.
153205, Jan. 22, 2007
3. Meaning of Accounted for in
Accordance with the Rules and
Regulations of the BSP
BIR Rul. No. 176-94
VAT Ruling No. 47-00, Oct. 26, 2000
C. Effectively Zero-Rated Transactions
1. Sale of Goods and Properties
Sec. 106(A)(2)(3), (5), (6) and (c), NIRC,
as amended by Rep. Act No. 9337
Sec. 4.106-6, Rev. Regs. No. 16-2005,
Sept. 1, 2005
2. Sale of Services
Sec. 106(B)(3), (4) and (5), NIRC, as
amended by Rep. Act No. 9337
Sec. 4.108-6, Rev. Regs. No. 16-2005,
Sept. 1, 2005
3. Requirement to Obtain Approved
Application for Effective Zero-Rating:
Deleted by Rev.
Regs. No. 4-2007, Feb. 7, 2007
Sec. 4.106-6, Rev. Regs. No. 16-2005,
Sept. 1, 2005, as amended by Rev.
Regs. No. 4-2007, Feb. 7, 2007 (which
deleted par. requiring approved
application for
effective zero-rating)
Sec. 4.108-6, Rev. Regs. No. 16-2005,
Sept. 1, 2005, as amended by Rev.
Regs. No. 4-2007, Feb. 7, 2007 (which
deleted par. requiring approved
application for
effective zero-rating)

D. Exempt Transactions
Sec. 109(1), NIRC, as amended by Rep.
Act. No. 9337
1. Coverage of Exemption
a. General Rule
Philippine Acetylene Co., Inc. v. CIR, 20
SCRA 1056 (1967)
Phil. National Police Multi-Purpose
Cooperative, Inc. v. CIR, CTA Case
No. 4845, March 10, 1994
BIR Ruling No. 155-98, Oct. 21, 1998
BIR Ruling No. 47-99, April 13, 1999
VAT Ruling No. 009-07, June 21, 2007
BIR Revenue Regulation No 16-2011,
effective January 1, 2012
b. Exception
CIR v. John Gotamco & Sons, Inc., 148
SCRA 36 (1987)
Maceda v. Macaraig, Jr., 223 SCRA 217
(1993)
2. Waiver of VAT Exemption/Election to
be Subject to VAT
Sec. 109(2), NIRC, as amended by Rep.
Act No. 9337

III. RATES OF VAT

A. For Output Tax
B. For Input Tax
C. Transitional Input Tax
D. Presumptive Input Tax
E. Final Withholding VAT on Government
or GOCCs