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    Case: Citibank, N.A. vs. Ca

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    Raquel Doquenia
    This case summary involves Citibank seeking a tax refund from amounts withheld from rental income in 1979 and 1980. Citibank filed tax returns for those years showing net losses, but taxes were still withheld from rental payments by tenants. Citibank claimed a refund for the withheld amounts totaling $569,989.85 but the Commissioner of Internal Revenue denied the refund. The Court of Tax Appeals ruled in Citibank's favor, but the Court of Appeals reversed. The issue is whether income taxes paid periodically should be credited or refunded based on the final tax return. The Supreme Court held that taxes paid periodically are partial payments until the final return is filed, at which point any refund would be determined.

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    Case: Citibank, N.A. vs. Ca

    Uploaded by

    Raquel Doquenia
    5 views1 page
    This case summary involves Citibank seeking a tax refund from amounts withheld from rental income in 1979 and 1980. Citibank filed tax returns for those years showing net losses, but taxes were still withheld from rental payments by tenants. Citibank claimed a refund for the withheld amounts totaling $569,989.85 but the Commissioner of Internal Revenue denied the refund. The Court of Tax Appeals ruled in Citibank's favor, but the Court of Appeals reversed. The issue is whether income taxes paid periodically should be credited or refunded based on the final tax return. The Supreme Court held that taxes paid periodically are partial payments until the final return is filed, at which point any refund would be determined.

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    TAXATION

    Original Title

    44. Citibank, n.a. vs. CA

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    This case summary involves Citibank seeking a tax refund from amounts withheld from rental income in 1979 and 1980. Citibank filed tax returns for those years showing net losses, but taxes were still withheld from rental payments by tenants. Citibank claimed a refund for the withheld amounts totaling $569,989.85 but the Commissioner of Internal Revenue denied the refund. The Court of Tax Appeals ruled in Citibank's favor, but the Court of Appeals reversed. The issue is whether income taxes paid periodically should be credited or refunded based on the final tax return. The Supreme Court held that taxes paid periodically are partial payments until the final return is filed, at which point any refund would be determined.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    5 views1 page

    Case: Citibank, N.A. vs. Ca

    Uploaded by

    Raquel Doquenia
    This case summary involves Citibank seeking a tax refund from amounts withheld from rental income in 1979 and 1980. Citibank filed tax returns for those years showing net losses, but taxes were still withheld from rental payments by tenants. Citibank claimed a refund for the withheld amounts totaling $569,989.85 but the Commissioner of Internal Revenue denied the refund. The Court of Tax Appeals ruled in Citibank's favor, but the Court of Appeals reversed. The issue is whether income taxes paid periodically should be credited or refunded based on the final tax return. The Supreme Court held that taxes paid periodically are partial payments until the final return is filed, at which point any refund would be determined.

    Copyright:

    © All Rights Reserved
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    CASE: CITIBANK, N.A. VS.

    CA
    October 10, 1997
    G.R. No. 61508

    FACTS:
    Citibank N.A. Philippine Branch (CITIBANK) is a foreign corporation doing business in the
    Philippines. In 1979 and 1980, its tenants withheld and paid to the Bureau of Internal Revenue
    the taxes on rents due to Citibank, pursuant to Section 1(c) of the Expanded Withholding Tax
    Regulations.

    On April 15, 1980, Citibank field its corporate income tax returns for the year and ended
    December 31, 1979 showing a net loss of P74,854,916.00 and its tax credits totaled
    P6,257,780.00, even without including the amounts withheld on rental income under the
    Expanded Withholding Tax System, the same not having been utilized or applied for the reason
    that the year’s operation resulted in a loss. The taxes thus withheld by the tenants from rentals
    paid to Citibank in 1979 were not included as tax credits although a rental income amounting to
    P7,796,811.00 was included in its income declared for the year ended December 31, 1979.

    For the year ended December 31, 1980, Citibank’s corporate income taxreturns, filed on
    April 15, 1981, showed a net loss P77,071,790.00 forincome tax purposes. Its available tax credit
    at the end of 1980 amounting to P11,532,855.00 was not utilized or applied. The said available
    tax credits did not include the amounts withheld by Citibank’s tenants from rental payment sin
    1980 but the rental payments for that year were declared as part of its gross income included in
    its annual income tax returns.

    On October 31, 1981, Citibank submitted its claim for refund of the aforesaid amounts of
    P270,160.56 and P298,829.29, respectively or a total of P568,989.85; and on October 12, 1981
    filed a petition for review with the Court of Tax Appeals concerning subject claim for tax refund.

    On August 30, 1981, the CTA adjudged Citibank’s entitlement to the tax refund sought for,
    representing the 5% tax withheld and paid on Citibank’s rental income for 1979 and 1980. The
    Court of Tax Appeals, rejected Respondent CIR’s argument that the claim was not seasonably
    filed. Not satisfied the Commissioner appealed to the Court of Appeals, CA ruled that Citibank
    N.A. Philippine branch, entitled to a tax refund/credit in the amount of P569,989.85, representing
    the 5% withheld tax in Citibank’s rental income for the years 1979 and 1980 is REVERSED.
    Motion for Reconsideration of the petitioner bank was denied. Hence, this petition.

    ISSUE:
    Whether or not income taxes remitted partially on a periodic or quarterly basis should be
    credited or refunded to the taxpayer on the basis of the taxpayer’s final adjusted returns.

    HELD:
    In several cases, we have already ruled that income taxes remitted partially on a periodic
    or quarterly basis should be credited or refunded to the taxpayer on the basis of the taxpayer’s
    final adjusted returns, not on such periodic or quarterly basis. When applied to taxpayers
    filing income tax returns on a quarterly basis, the date of payment mentioned in Sec. 230 must be
    deemed to be qualified by Sec. 68 and 69 of the present. Tax Code. It may be observed
    that although quarterly taxes due are required to be paid within 60 days from the close of each
    quarter, the fact that the amount shall be deducted from the tax due for the succeeding quarter
    shows that until a final adjustment return shall have been filed, the taxes paid in the preceding
    quarters are merely partial taxes due from a corporation. Neither amount can serve as the final
    figure to quantify what is due the government nor what should be refunded to be corporation. This
    interpretation may be gleaned from the last paragraph of Sec. 69 of the Tax Code which provides
    that the refundable amount, in case a refund is due a corporation, is that amount which is shown
    on its final adjustment return and not on its quarterly returns.

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