How To Deal With Tax Problems

It is important for taxpayers or their authorize representatives, officers & employees to know the purposes or objectives of tax planning and management. 

Attending seminars in taxation from educational or training institutions, professional organizations and other BIR-accredited Continuing Professional Education (CPE) providers is necessary to learn more ideas, tax updates, techniques and other related tax matters.

I have learned lately from a seminar that we should learn on how to address or deal with tax problems as follows:

1. Know applicable tax laws and regulations and how these are interpreted by the Bureau of Internal Revenue (BIR), Department of Finance (DOF), and the courts, so that you can be tax-compliant.

2. Learn or familiarize the assessment cycle and handling audits by BIR.

3. Learn or study the legal ways to eliminate or reduce tax liability without violating the laws and regulations.

4. Know the errors and pitfalls committed by the other taxpayers; learn from them and avoid committing the same mistakes.

5. Be aware of the common audit findings of revenue officers that are the sources of deficiency tax assessments.

6. Get professional help from a good tax consultant.

Difference Between Tax Evasion and Tax Avoidance

Did you know that Evasion and Avoidance are sometimes used as synonyms in connection with tax matters?

A useful difference may, however, be drawn between them. Evasion should be applied to the escape from taxation accomplished by breaking the law - deliberate omission to report a taxable item, for example.

The term avoidance is the available to cover escaped accomplished by legal procedure which may be contrary to the intent of the tax law's sponsors but nevertheless do not violate the law.