BIR wants me to pay Compromise & Penalty due to their own error
Hello! I’d like to get your thoughts on this situation.
I’m transferring a property belonging to my client from her deceased parents. We already paid all the necessary taxes to the BIR, including penalties and compromise penalties, amounting to around ₱40,000.
The return was filed and paid in June, and we were simply waiting for the eCAR to be issued. However, when we followed up yesterday, we were informed that the return had supposedly been pulled out and the computation amended.
According to the person who computed, she had made a mistake in the basis used for the original computation. Because of this, there is now an amended computation requiring us to pay another ₱40,000 on top of the deficiency as penalties including compromise penalty.
I’m not a tax practitioner, so I’d really appreciate some advice on how to proceed. I understand that if there is an actual deficiency in the estate tax, my client may have to pay the deficiency.
However, the additional penalties and compromise penalty seem unfair, considering that the original return was already filed and paid, and the need for the amended computation was due to an error on the BIR’s end.
Has anyone encountered a similar situation? Is the BIR allowed to impose additional penalties/compromise penalties under these circumstances? What would be the proper way to contest or request a reconsideration of the additional amount?
Any advice would be greatly appreciated. Thank you!