When Does the BIR's Prescription Period Stop Running? NIRC Section 223 Suspension Events Explained
NIRC Section 223 pauses the BIR’s prescriptive periods for assessment and collection in five situations, including when the taxpayer requests a reinvestigation that is granted, cannot be located at the address in the return, or is out of the Philippines. The base period is three years from the filing deadline under Section 203 (ten years from discovery for fraud or non-filing under Section 222), and every day of suspension extends it.
Never Miss a Deadline Again — Start FREE →What are the base periods that Section 223 suspends? #
Section 203 sets the ordinary rule: internal revenue taxes “shall be assessed within three (3) years after the last day prescribed by law for the filing of the return,” and a return filed late starts the three years from the actual filing date. Section 222(a) allows assessment “within ten (10) years after the discovery of the falsity, fraud or omission” for false or fraudulent returns or failure to file, and Section 222(c) allows collection within five years following assessment. Related cases are discussed in McDonald’s Realty v. CIR on the ten-year fraud period, and written extensions are covered in BIR Waiver of the Statute of Limitations.
What does Section 223 say? #
“The running of the Statute of Limitations provided in Sections 203 and 222 on the making of assessment and the beginning of distraint or levy a proceeding in court for collection, in respect of any deficiency, shall be suspended for the period during which the Commissioner is prohibited from making the assessment or beginning distraint or levy or a proceeding in court and for sixty (60) days thereafter; when the taxpayer requests for a reinvestigation which is granted by the Commissioner; when the taxpayer cannot be located in the address given by him in the return filed upon which a tax is being assessed or collected: Provided, that, if the taxpayer informs the Commissioner of any change in address, the running of the Statute of Limitations will not be suspended; when the warrant of distraint or levy is duly served upon the taxpayer, his authorized representative, or a member of his household with sufficient discretion, and no property could be located; and when the taxpayer is out of the Philippines.”
— Section 223, National Internal Revenue Code (Republic Act No. 8424), as posted by LawPhil.
What are the five suspension events? #
| # | Event | Suspension period |
|---|---|---|
| 1 | The Commissioner is prohibited from assessing or collecting | The prohibition period plus 60 days |
| 2 | The taxpayer requests a reinvestigation and the Commissioner grants it | While the reinvestigation is pending (the text does not give a fixed length) |
| 3 | The taxpayer cannot be located at the address in the return | Until located; no suspension if the taxpayer informed the BIR of the address change |
| 4 | A warrant of distraint or levy is served and no property can be located | While that condition persists |
| 5 | The taxpayer is out of the Philippines | While the taxpayer is abroad |
Event 3 has a built-in remedy: informing the Commissioner of an address change prevents suspension. See How to Update Your Registration or Transfer RDO.
Worked example: a taxpayer abroad for 120 days #
Elena filed her calendar-year 2023 annual income tax return on its due date, April 15, 2024 (fictional scenario).
| Step | Date |
|---|---|
| Last day to assess under Section 203 (three years) | April 15, 2027 |
| Elena is out of the Philippines for 120 days | Suspends the running of the period |
| Extended last day to assess (April 15, 2027 + 120 days) | August 13, 2027 |
An assessment issued on June 1, 2027 would still be timely under this reading, even though June 1 is after April 15, 2027. The suspension rule applies only to the periods in Sections 203 and 222, not to any other deadline.
What taxpayers should do #
- Keep the registered address current so Event 3 cannot suspend the clock.
- Treat a granted reinvestigation as extending the BIR’s time, not shortening it.
- Track each assessment against both the base period and any suspension; see PAN vs FAN: The Assessment Due-Process Sequence.
- Do not assume prescription without checking for suspension events or a written waiver, per the Telstar waiver case.
Summary #
NIRC Section 223 suspends the three-year assessment period (Section 203), the ten-year fraud or non-filing period (Section 222(a)), and the five-year collection period (Section 222(c)) in five listed situations, including a granted reinvestigation, an unlocatable taxpayer with no address notice, and absence from the Philippines. The quoted text comes from RA 8424 as posted by LawPhil; verify against the current consolidated Code before relying on a prescription defense.
Frequently asked questions #
How long does the BIR have to assess a tax? #
Generally three years after the last day prescribed by law for filing the return, under NIRC Section 203. If the return was filed late, the three years run from the actual filing date.
What suspends the BIR’s prescriptive period? #
Under NIRC Section 223: a period in which the Commissioner is prohibited from assessing or collecting plus 60 days, a granted reinvestigation request, a taxpayer who cannot be located at the address in the return, service of a warrant of distraint or levy with no property found, and the taxpayer being out of the Philippines.
Does changing my address suspend the statute of limitations? #
No, provided you inform the Commissioner of the change. Section 223 states that if the taxpayer informs the Commissioner of any change in address, the running of the statute of limitations is not suspended on that ground.
Does asking for a reinvestigation extend the BIR’s time to assess? #
Yes, if the Commissioner grants it. NIRC Section 223 suspends the running of the statute of limitations when the taxpayer requests a reinvestigation which is granted by the Commissioner.
How long does the BIR have to collect after an assessment? #
Five years following the assessment when the assessment was made within the period of limitation, under NIRC Section 222(c), subject to the suspension events in Section 223.