DUE process is the right to be heard. It is the obligation of the state to respect all legal rights owed to a person, and it balances the power of law of the land and protects the individual from it.
This is enshrined in our Tax Code, through Section 228, wherein it provides that when the commissioner or his duly authorized representative finds that proper taxes should be assessed, he shall first notify the taxpayer of his findings.
Through Revenue Regulation (RR) No. 22-2020, Section 3 of RR No. 12-1999, as amended by RR No. 18-2013 and RR No. 7-2018, is further amended to provide for the Notice of Discrepancy, replacing the Notice of Informal Conference. The Notice of Discrepancy is issued to the taxpayer if he is found to be liable for tax deficiencies during an investigation conducted by a revenue officer.
A Notice of Discrepancy is not yet a deficiency tax assessment. It only aims to fully afford the taxpayer an opportunity to present and explain his side on the discrepancies found.
Based on the prescribed template for the Notice of Discrepancy, the taxpayer must be able to present and explain its side on the discrepancies noted by the BIR within five days from receipt of the notice. Should the taxpayer need more time to present documents, he may submit such documents after the discussion but within 30 days from receipt of the Notice of Discrepancy.
The discussion of discrepancies shall not extend beyond 30 days from the receipt of the notice. Within 10 days from the conclusion of the discussion of discrepancies, the investigating office shall endorse the case for review and approval for issuance of a Preliminary Assessment Notice if the taxpayer is still found to be liable for deficiency taxes.
P&A Grant Thornton
Certified Public Accountants