San Carlos Milling Co. Inc. v CIR
GR No 103379, November 23, 1993
FACTS:
Petitioner domestic corporation had for the taxable year 1982 a total income tax overpayment of P781,393 reflected as
creditable income tax. The same amount was reflected in its 1983 tax return including P4,470 representing 3% of 15% withholding tax on storage credits. Petitioner signified its intention to apply the total creditable amount of P785,863 against its 1984 tax dues coupled with a coupled with a comforting alternative request for a refund or tax credit of the same. Respondent disallowed the proferred automatic credit scheme but treated the request as an ordinary claim for refund/tax credit under Section 292 in relation to Section 295 of the Tax Code and accordingly subjected the same for verification/investigation. Petitioner filed a supplemental petition on March 11, 1986, after having unilaterally effected a set-off of its creditable income tax vis a vis income tax liabilities, earlier denied by the respondent.
ISSUE:
Whether prior authority from the Commissioner of Internal Revenue is necessary before a corporate taxpayer can credit
excess estimated quarterly income taxes for the succeeding taxable year
RULING:
Yes, authority of the CIR is a requisite before a corporate taxpayer can credit excess taxes paid to estimated tax liabilities. Section 7 of Revenue Regulation No. 10-77 provides that: “any excess computed and shown shall either (a) be refunded
to the corporation or (b) may be credited against the estimated quarterly income tax liabilities”
Insofar as the option of tax credit is concerned, this right should not be construed as an absolute right which is available to the taxpayer at his sole option.
FACTS:
Petitioner domestic corporation had for the taxable year 1982 a total income tax overpayment of P781,393 reflected as
creditable income tax. The same amount was reflected in its 1983 tax return including P4,470 representing 3% of 15% withholding tax on storage credits. Petitioner signified its intention to apply the total creditable amount of P785,863 against its 1984 tax dues coupled with a coupled with a comforting alternative request for a refund or tax credit of the same. Respondent disallowed the proferred automatic credit scheme but treated the request as an ordinary claim for refund/tax credit under Section 292 in relation to Section 295 of the Tax Code and accordingly subjected the same for verification/investigation. Petitioner filed a supplemental petition on March 11, 1986, after having unilaterally effected a set-off of its creditable income tax vis a vis income tax liabilities, earlier denied by the respondent.
ISSUE:
Whether prior authority from the Commissioner of Internal Revenue is necessary before a corporate taxpayer can credit
excess estimated quarterly income taxes for the succeeding taxable year
RULING:
Yes, authority of the CIR is a requisite before a corporate taxpayer can credit excess taxes paid to estimated tax liabilities. Section 7 of Revenue Regulation No. 10-77 provides that: “any excess computed and shown shall either (a) be refunded
to the corporation or (b) may be credited against the estimated quarterly income tax liabilities”
Insofar as the option of tax credit is concerned, this right should not be construed as an absolute right which is available to the taxpayer at his sole option.
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