Realty Firm charged with tax evasion

The Bureau of Internal Revenue (BIR) today filed a criminal complaint with the Department of Justice against WOODHEIGHTS REALTY AND DEVELOPMENT CORPORATION (WOODHEIGHTS) and its corporate officers EDWIN L. GARDIOLA, JUDY S. GARDIOLA, KIM ANN S. GARDIOLA, KATRINA MARA S. GARDIOLA and DONNA S. NICANOR for one (1) count of willful attempt to evade or defeat tax and one (1) count of deliberate failure to file its Income Tax Return (ITR) for taxable year 2009, in violation of Section 254, Section 255 and Section 256 of the National Internal Revenue Code of 1997, as amended (Tax Code).

WOODHEIGHTS, a domestic corporation organized under Philippine laws and registered with the Securities and Exchange Commission (SEC), is registered with the BIR as Woodheights Estate Corp. with business address at Bukang Liwayway St., Brgy. Calingatan, Mataas na Kahoy, Batangas.

Sometime in 2009, EDWIN L. GARDIOLA was investigated by the BIR to determine his internal revenue liabilities for taxable year 1999 to 2008. In the course of the audit, investigators discovered that various luxury motor vehicles – Lexus LS460 4.6(5S), Lexus LS460 4.6(4S), and Lexus GS460 4.6(4S) – worth P20.834M apparently owned by EDWIN L. GARDIOLA were purchased by WOODHEIGHTS from Lexus Manila, Inc. in various dates in 2009.

An examination of the WOODHEIGHTS Financial Statements (FS) as of December 31, 2009 by investigators found out that WOODHEIGHTS had no capacity to purchase the said Lexus motor vehicles. Furthermore, the purchase of the said Lexus units in 2009 was not reflected in the said FS. Documents gathered also showed that WOODHEIGHTS did not file its Annual ITR for taxable year 2009.

On the basis of said discoveries, the BIR ascertained that WOODHEIGHTS, through its responsible corporate officers, committed tax evasion by not reporting the income it used to purchase the Lexus motor vehicles when it failed to file its 2009 tax return.

WOODHEIGHTS was assessed a total tax liability amounting to P16.52M, inclusive of surcharge and interest, broken down into Income Tax of P11.77M and VAT of P4.75M.

The case against WOODHEIGHTS REALTY AND DEVELOPMENT CORPORATION and its corporate officers EDWIN L. GARDIOLA, JUDY S. GARDIOLA, KIM ANN S. GARDIOLA, KATRINA MARA S. GARDIOLA and DONNA S. NICANOR is the ninety-fifth (95th) filed under the Run After Tax Evaders (RATE) program of the BIR under the leadership of Commissioner Kim S. Jacinto-Henares.