The Supreme Court of the Philippines has ruled in favor of Dohle Shipmanagement Philippines Corp. (Dohle) in a value-added tax (VAT) refund case, clarifying the timeline for filing claims with the Bureau of Internal Revenue (BIR).
In a decision released on February 5, 2025, authored by Associate Justice Alfredo Benjamin S. Caguioa, the court affirmed that for VAT refund claims filed before June 11, 2014, the 120-day period for the BIR to resolve a claim begins when the taxpayer determines that all necessary documents have been submitted.
For claims filed before June 11, 2014, the 120-day period starts upon the complete submission of documents or when the taxpayer states no further documents will be submitted. If the BIR requests additional documents, taxpayers have 30 days to comply, and the 120-day period starts from submission or after the 30 days lapse. If the BIR does not notify the taxpayer of an incomplete submission, the 120-day period starts when additional documents are voluntarily submitted.
For claims between June 11, 2014, and December 31, 2017, the 120-day period begins when a complete claim is filed, and no further documents may be submitted. From January 1, 2018, the BIR has only 90 days to resolve the claim, rejecting incomplete submissions outright.
The case involved Dohle’s claim for a refund on unutilized input VAT from 2012. The company filed an administrative claim on March 31, 2014, and submitted additional documents on July 28, 2014. The BIR argued that the 120-day period started on March 31, making Dohle’s judicial claim on December 23, 2014, late. However, both the Court of Tax Appeals (CTA) and the Supreme Court ruled in favor of Dohle, stating that since the additional documents were voluntarily submitted, the 120-day period began on July 28, 2014.
This ruling reinforces taxpayer rights by ensuring the BIR adheres to procedural fairness in VAT refund claims. The decision provides clarity on the proper interpretation of the 120+30-day rule, benefiting businesses navigating tax refund procedures in the Philippines.
