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Atty. NAR Business Law and Taxation, Catleya Street, Daraga (2026)

09/05/2026

You cannot just run to the CTA because you disagree with the BIR.

In V.Y. Domingo Jewellers, Inc. v. CIR, the Supreme Court reminded taxpayers that the Administrative Protest process is NOT optional. Before judicial action, you must first exhaust administrative remedies under Section 228 of the NIRC.

📌 No proper protest?
Possible result:
❌ Assessment becomes final
❌ CTA may have no jurisdiction
❌ Case dismissed before the real battle even starts

09/05/2026

💼 DAY 7 OF 7 — KNOW THE SPECIAL RULES

You made it to Day 7. And here is where many exam questions become tricky.

Sometimes students know the taxpayer, the income, the source, and even the computation—but still get the wrong answer because they missed a special rule.

⚖️ In Taxation, exceptions can change everything.

Here are common areas to watch:

🎁 Fringe Benefits
Additional benefits given by employers may follow special tax rules.

🏢 MCIT
Certain corporations may be subject to Minimum Corporate Income Tax when conditions under the law are met.

📄 Withholding Taxes
Some income taxes are collected through withholding at source.

🔄 Tax-Free Exchanges
Certain transfers or reorganizations may qualify for non-recognition of gain, subject to requirements.

✅ Exempt Entities / Exempt Income
Some taxpayers or income may enjoy exemptions under the Constitution or by statute.

📚 Special Laws
Specific industries or transactions may be governed by separate tax incentives or special rules.

🎯 Simple reminder:
In Bar exams and real practice, the issue is often not the general rule—it is the exception.

So after learning the basics, always ask:

👉 Is there a special rule that applies here?

That question alone can save many points.

Thank you for joining this 7-Day Income Taxation Series.

📌 What topic would you like next—VAT, Tax Remedies, Local Taxation, Transfer Taxes, or Corporation Law? Comment below.

Learn with clarity. Pass with confidence.

08/05/2026

💼 DAY 6 OF 7 — KNOW THE TIMING

Many students focus on how much tax is due, but sometimes the real issue is simpler:

📅 When should the income be recognized?

In Income Tax, timing matters because it determines which taxable year the income belongs to.

The same income, recognized in a different year, can produce a different tax result.

Here’s a simple guide:

💵 Cash Basis
Income is recognized when actually received or made available in cash or equivalent.

📄 Accrual Basis
Income is recognized when the right to receive it becomes fixed and determinable, even if payment comes later.

📬 Constructive Receipt
Income may be treated as received when it is already available to the taxpayer without major restriction.

📆 Installment Method
Used in certain cases where income is reported over time as payments are received.

🎯 Simple reminder:
Taxation is not only about amount—it is also about timing.

Many errors happen because students know the rule, but place the income in the wrong year.

Before computing tax, ask first: When is the income taxable?

Learn with clarity. Pass with confidence.

07/05/2026

💼 DAY 5 OF 7 — KNOW THE COMPUTATION

Many students get nervous when they see numbers in Taxation. But most income tax computations become easier when the steps are clear.

After identifying the taxpayer, the income, the source, and the tax treatment, the next question is:

🧮 How much is taxable?

Here is the usual flow:

💰 Gross Income
Start with income received or earned that is subject to tax.

➖ Less: Exclusions
Some items are not taxable by law, so they are removed first.

➖ Less: Allowable Deductions
Certain expenses or deductions may reduce taxable income, depending on the taxpayer and applicable rules.

📊 Net Taxable Income
This is the amount generally used as basis for income tax.

⚖️ Apply the Proper Tax Rule
Graduated rates, final tax, capital gains tax, preferential rate, or exemption—depending on the situation.

🎯 Simple reminder:
Tax is not always based on total money received. It is based on the correct taxable base under the law.

Many mistakes happen not because students cannot compute—but because they started with the wrong amount.

Take it step by step. Taxation becomes clearer that way.

Learn with clarity. Pass with confidence.

06/05/2026

💼 DAY 4 OF 7 — KNOW THE TAX TREATMENT

Many students think that once income is identified, the next step is to compute the tax immediately.

Not yet.

First ask:

⚖️ How is the income taxed?

Because not all income follows the same rules. The same amount can be subject to different tax treatments depending on the law.

Here’s a simple guide:

📊 Graduated Rates
Usually applies to taxable income of individuals and certain taxpayers based on income brackets.

🏦 Final Tax
Tax is withheld or imposed at a fixed rate, and it generally ends the income tax obligation for that income.

🏠 Capital Gains Tax
Applies to gains from certain sales or dispositions of capital assets, subject to specific rules.

📌 Preferential Rate
Special lower rate granted by law in certain situations.

✅ Exempt Income
Income specifically excluded from tax by the Constitution or by statute.

🎯 Simple reminder:
Before computing the amount of tax, determine first which rule applies.

Many wrong answers happen not because of math—but because the wrong tax treatment was used.

Learn with clarity. Pass with confidence.

05/05/2026

💼 DAY 3 OF 7 — KNOW THE SOURCE

After identifying the taxpayer and the kind of income, the next question is:

🌍 Where did the income come from?

In taxation, this is called the source or situs of income. It matters because the source often determines whether the Philippines has the right to tax that income.

Here’s a simple guide:

👨‍💼 Services Rendered
Income is generally sourced where the service was performed.
If you worked in the Philippines, the income is usually Philippine-sourced.

📦 Sale of Goods
Usually based on where the goods are sold or located under applicable rules.

🏦 Interest Income
Often based on the residence of the debtor or borrower.

🏠 Rental Income
Usually sourced where the property is located.

📈 Dividend Income
Depends on the corporation paying the dividends and applicable rules.

🎯 Simple reminder:
Not all income earned by a Filipino or paid in pesos is automatically Philippine income. The legal source still matters.

Before asking how much tax is due, first ask where the income came from.

That small habit can prevent a wrong answer.

Learn with clarity. Pass with confidence.

04/05/2026

💼 DAY 2 OF 7 — KNOW THE INCOME

After identifying the taxpayer, the next question is:

💰 What kind of income was earned?

This matters because not all income is taxed the same way. Two people may receive money—but the tax treatment can be very different depending on where it came from.

Here’s a simple guide:

👔 Compensation Income
Income from employment such as salary, wages, bonuses, and allowances.

📈 Business / Professional Income
Income from selling goods, running a business, freelancing, or professional services.

🏦 Passive Income
Income earned without active day-to-day work, like interest, dividends, royalties, or rent.

🏠 Capital Gains
Income or gain from selling assets like shares of stock or real property.

🎁 Other Income
Prizes, winnings, or other earnings that do not clearly fall under the usual categories.

🎯 Simple reminder:
The same amount of money can be taxed differently depending on the kind of income.

Before computing tax, classify the income first. That one step can change the whole answer.

Learn with clarity. Pass with confidence.

03/05/2026

💼 DAY 1 OF 7 — KNOW THE TAXPAYER

Many students jump straight to rates and computations. But in Income Tax, the first question is much simpler:

👤 Who earned the income?

Because before you solve anything, you need to know who the taxpayer is. One small detail can completely change the answer.

Why it matters:

🌍 Some taxpayers are taxed on worldwide income
🇵🇭 Others are taxed only on Philippine-sourced income
📊 Different taxpayers may also have different rules, rates, or treatments.

Quick examples:

👨‍💼 Resident Citizen – worldwide income
✈️ Nonresident Citizen – Philippine-sourced income
🏢 Domestic Corporation – worldwide income
🏬 Foreign Corporation – Philippine-sourced income
📜 Estate / Trust – separate taxable entities

🎯 Simple reminder:
Before asking how much is the tax, ask first who is being taxed.

That habit alone can save you many points in exams.

Learn with clarity. Pass with confidence.

02/05/2026

Income Taxation feels overwhelming—until you learn the right structure.

Many Bar reviewees study taxes by memorizing scattered rules. That approach creates confusion.

The smarter way is to master the flow:

👤 Who is the taxpayer?
💰 What kind of income?
🌍 Where sourced?
⚖️ How taxed?
🧮 How much taxable?
📅 When recognized?
📌 Exceptions or special rules?

Once you understand the framework, Income Tax becomes clearer, faster, and more manageable.

🎯 Taxation is not just memory work—it is classification, analysis, and proper application of the law.

Learn with clarity. Pass with confidence.

02/05/2026

What is a State of Calamity—and why is it declared during events like the Mayon eruption?

Atty. NAR Business Law and Taxation

09/05/2026

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