The Bureau of Internal Revenue (BIR) today filed a criminal complaint with the Department of Justice against MA. CARLA BEATRIZ C. CASTILLO (CASTILLO) for willful attempt to evade or defeat tax and for deliberate failure to file her Income Tax Return (ITR), for taxable year 2010, in violation of Section 254 and Section 255 of the National Internal Revenue Code of 1997, as amended (Tax Code).
CASTILLO, daughter of former Supreme Court Chief Justice Renato C. Corona, is a registered taxpayer of Revenue District Office No. 39, South Quezon City with addresses at #20 Kalayaan Avenue, Diliman, Quezon City and/or 27 Abada Street, Xavierville Subdivision, Loyola Heights, Quezon City.
Records of the BIR showed that CASTILLO declared in her ITR for 2008 and 2009 a cumulative income amounting to P228,040.00. On the other hand, information from documents gathered disclosed that CASTILLO acquired in 2010 a property located at 57 Maranao Street, La Vista, Quezon City for P18 million for which she paid Documentary Stamp Tax (DST) of P329,000.00.
Investigation revealed that CASTILLO deliberately failed to file her ITR with the BIR in 2010 despite receipt of substantial amounts of income as manifested by her ability to acquire property and pay the amount of P18.33 million.
BIR investigators used the Expenditures Method of tax investigation to show that CASTILLO substantially underdeclared her income. The method is based on the theory that if a subject taxpayer’s expenditures during a given year exceed her reported income and the source of the funds used to make the expenditures is unexplained, it may be inferred that such expenditures represent unreported income.
Under the said method, CASTILLO’s cumulative income of P228,040.00 as declared in her ITRs for taxable years 2008 to 2009 compared with her expenditure of P18.33 million in 2010 clearly indicated a difference of P18.1 million or a 7,938% underdeclaration. The said difference constitutes substantial underdeclaration of more than 30% and is considered as prima facie evidence of fraud tantamount to tax evasion.
CASTILLO was sued for a total income tax liability of P9.93 million, inclusive of increments, for taxable year 2010.
The case against MA. CARLA BEATRIZ C. CASTILLO is the 123rd filed under the Run After Tax Evaders (RATE) program of the BIR under the leadership of Commissioner Kim S. Jacinto-Henares.