Tax Updates January 2021 (SyCipLaw Tax Issues And Practical Solutions (T.I.P.S.) Vol. 7)

1. Can the 25% surcharge for late filing of a tax return be abated due to faulty internet connection at the taxpayer's office on the last day of filing?

No. In Qatar Airways with Limited Liability v. Commissioner of Internal Revenue (G.R. No. 238914, June 8, 2020), the Supreme Court ruled that it is neither unjust nor excessive on the part of the Bureau of Internal Revenue (BIR) to impose a 25% surcharge even if the taxpayer was only one day late in filing its tax return (and even if the late filing is due to faulty internet connection at the taxpayer's office on the last day of filing) and in paying the tax due thereon. In this case, the taxpayer requested the abatement or cancellation of the 25% surcharge that was imposed by the BIR for the belated filing of its second quarterly income tax return. The taxpayer pleaded good faith and claimed that the late filing was due to a technical problem (i.e., faulty internet connection at the taxpayer's office on the last day