You might be wondering, what’s a Notice of Discrepancy to begin with?
And why is it relevant?
Well, a Notice of Discrepancy (NOD) goes like this…
Let’s say that you paid your internal revenue taxes…
On time…
Dutifully…
And in the exact and proper amount.
No problem, right?
However, upon audit conducted by the BIR…
It was found that you have discrepancies…
And because of these discrepancies, they will now inform you through this so-called Notice of Discrepancy.
Don’t worry…
This isn’t a criminal suit for tax evasion…
At least not yet. (just kidding!)
Remember that we have procedural due process.
Aldrin, what’s this procedural due process you’re talking about??
You see…
Within 5 days from the date of your receipt of this Notice…
You’ll be able to explain and present your side with the Investigating Revenue Officer through a scheduled proceeding / hearing called Discussion of Discrepancy.
You may submit whatever documentary evidence you may have to reconcile and refute the noted discrepancies.
You may have a counsel to assist and/or represent you in this proceeding.
However, if you fail to appear…
It may be considered as a waiver.
Which means… you will no longer be able to explain and present your side with the Investigating Revenue Officer.
In which case… a Preliminary Assessment Notice (PAN) covering the deficiency tax assessment shall be sent to you within ten (10) days.
For more info, see BIR REVENUE REGULATION NO. 22-2020
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