REVENUE MEMORANDUM CIRCULAR 7-2013 - Circularizes the BIR Framework for Information Systems
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Sunday, October 20, 2013
RMC No. 6-2013
REVENUE MEMORANDUM CIRCULAR 6-2013 - Clarifies taxpayers' concerns on the audit program and their responsibility in engaging tax agents/practitioners
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RMC No. 5-2013
REVENUE MEMORANDUM CIRCULAR 4-2013 - Publishes the full text of Joint Circular No. 5-2012 entitled "Joint
Guidelines Implementing the Special Provision of the General
Appropriations Act on VAT Refunds on Importation"
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Friday, October 18, 2013
RMC No. 4-2013
REVENUE MEMORANDUM CIRCULAR 4-2013 - Requires tax-exempt hospitals to secure revalidated tax exemption rulings/certificates
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RMO No. 27-2013
REVENUE MEMORANDUM ORDER NO.
27-2013 issued on October 11, 2013 Amends the 2012 Value-Added Tax Audit Program
Date Issued - October 11, 2013
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Date Issued - October 11, 2013
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Tuesday, October 15, 2013
RMC No. 3-2013
REVENUE MEMORANDUM CIRCULAR 3-2013 - Clarifies certain provisions of RR No. 17-2012 implementing the
provisions of RA No. 10351 as well as the provisions of RMC No. 90-2012
providing the initial tax classifications of alcohol and tobacco
products
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RMC No. 2-2013
REVENUE MEMORANDUM CIRCULAR 2-2013 -Clarifies certain provisions of RR No. 12-2012 on the deductibility of
depreciation expenses as it relates to purchase of vehicles and other
expenses related thereto and the input taxes allowed therefor
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RMC No. 1-2013
REVENUE MEMORANDUM CIRCULAR 1-2013 - Notifies the cancellation of one (1) unissued set of BIR Form No. 2313 - Certificate Authorizing Registration
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Sunday, October 13, 2013
RR No. 17-2013
REVENUE REGULATIONS NO. 17-2013 issued on September 27, 2013 clarifies the retention period and prescribes the guidelines on the preservation of books of accounts and other accounting records.
All taxpayers are required to preserve their books of accounts, including subsidiary books and other accounting records for a period of ten (10) years reckoned from the day following the deadline in filing a return or if filed after the deadline, from the date of filing of the return, for the taxable year when the last entry was made in the books of accounts.
If the taxpayer has any pending protest or claim for tax credit/refund of taxes, and the books and records concerned are material to the case, the taxpayer is required to preserve his/its books of accounts and other accounting records until the case is finally resolved.
Unless a longer period of retention is required under the National Internal Revenue Code (NIRC) or other relevant laws, the independent Certified Public Accountant who audited the records and certified the financial statements of the taxpayer, equally as the taxpayer, has the responsibility to maintain and preserve copies of the audited and certified financial statements for a period of 10 years from the due date of filing the annual Income Tax return or the actual date of filing thereof, whichever comes later.
All books, registers and other records, and vouchers and other supporting papers required by the BIR shall be kept at all times at the place of business of the taxpayer, subject to inspection by any internal revenue officer, and upon demand, the same must be immediately produced and submitted for inspection. They may be examined and inspected for purposes of regular audit or extraordinary audit, requests for exchange of information by a foreign tax authority under Sections 6 and 71 of the NIRC, and in the exercise of the Commissioner’s power to obtain information under Section 5 of the NIRC, among others.
Examination and inspection of books of accounts and other accounting records shall be done in the taxpayer’s office or place of business or in the office of the BIR.
Any violation of the provisions of these regulations shall be subject to penalties provided in Sections 266, 275 and, other pertinent provisions of the NIRC; and Section 6 of Republic Act No. 10021 (the “Exchange of Information on Tax Matters Act of 2009”).
(Published in Manila Bulletin on September 28, 2013)
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RR No. 16-2013
REVENUE REGULATIONS NO. 16-2013 issued on September 25, 2013 revokes Revenue Regulations (RR) Nos. 16-2003 and 24-2003 relative to the taxation of privilege stores, and imposes new rules on the collection of Business and Income Taxes, including Withholding Tax on income payments by/to “privilege stores” (popularly known as “tiangge/s)” and the obligations of organizers or exhibitors of space for the operation of “privilege stores” as well as the obligations of the “privilege store” operators.
The obligations to the BIR of exhibitor or organizer are the following:
a. Obligation to post in a conspicuous place the Certificate of Registration of the organizer issued by the BIR
b. Obligation to deduct and withhold Expanded Withholding Tax on lease payments to the lessor of real property
c. Obligation to provide the Revenue District Office (RDO) with the list of names, residence addresses, stall, slot or unit number in the privilege store outlet, location site of the privilege store outlet, individual Taxpayer Identification Number (TIN) of persons/entities participating in the event or exhibit and the specific dates and duration when such operations shall be conducted
d. Obligation to ensure compliance of lessees/tenants to the following: presentation of TIN and Official Receipts/Sales or Commercial Invoice; submission of Information Statement on Privilege Store Activities indicating the duration (total number of days) of business operations and presentation of proof of payment of actual withholding tax due on its income payment
e. Obligation to keep Books of Accounts and issue receipts
f. Obligation to provide Cash Register Machines/Point-of-Sale (CRM/POS) Machines for each privilege store operator, or centralized CRM/POS/Payment Centers, or allow the use of its own manual Official Receipts/Sales or Commercial Invoices for the exclusive use by its Privilege Store Operators to monitor the sales of the latter
g. Obligation to ensure the submission of List of Sales within 5 days after the privilege store operation
h. Obligation to report to the BIR non-compliance by the privilege store operators/lessees with their obligations and responsibilities
The obligations to the BIR of privilege store operators are the following:
a. Obligation to deduct and withhold the Expanded Withholding Tax on rental payments to exhibitor/organizer for sub-leased spaces or lessor/owner of leased property
b. Obligation to file Income Tax returns
c. Obligation to submit Information Statement on Privilege Store Activities
d. Obligation to keep Books of Accounts and issue receipts/sales or commercial invoices
e. Obligation to submit List of Sales on Privilege Store Activities to the exhibitor/organizer
The obligations to the BIR of lessees/tenants not classified as “Privilege Store Operators” (regular taxpayers) are the following:
a. Obligation to deduct and withhold the Expanded Withholding Tax on rental payments to exhibitor/organizer for sub-leased spaces or lessor/owner of leased property
b. Obligation to keep Books of Accounts and issue receipts/sales or commercial invoices
c. Obligation to file Income, Withholding, Business (Percentage or Value- Added) and other tax returns, and pay the correct amount of taxes
d. Obligation to file other information returns
A privilege store operator whose business operation/s is more than 15 days ceases to be as such and shall thenceforth be governed by existing revenue laws and regulations applicable to regular taxpayers.
The RDOs shall be primarily responsible in monitoring compliance by the organizer/exhibitor of his/its obligations imposed herein and the activities of any privilege store operating within their respective jurisdictions, as well as in validating the list furnished by the exhibitor/organizer with respect to such information regarding the identity of the participants, the number of participants and the duration of the exhibit. The validation of the participants, as reported by the exhibitor/organizer, shall be made through the BIR’s existing registration system.
Based on the list provided by the exhibitor/organizer, the RDO shall recommend the issuance by the Regional Director of Mission Order/s directing the deployment of Revenue Officers (ROs) who shall be in-charged of physically checking compliance by the exhibitor/organizer, privilege store operators and regular taxpayers with their obligations as enumerated above, particularly the filing of tax returns (i.e. Income Tax returns, Percentage or Value-Added Tax returns, etc.).
(Published in Manila Bulletin on September 25, 2013)
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Annex C
Annex D
Annex E
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RR No. 15-2013
REVENUE REGULATIONS NO. 15-2013 issued on September 20, 2013 implements Republic Act No. 10378 entitled “An Act Recognizing the Principle of Reciprocity as Basis for the Grant of Income Tax Exemptions to International Carriers and Rationalizing Other Taxes Imposed Thereon by Amending Sections 28(A)(3)(A), 109, 118 and 236 of the National Internal Revenue Code (NIRC), as Amended, and for Other Purposes.”
An international carrier having flights or voyages originating from any port or point in the Philippines, irrespective of the place where passage documents are sold or issued, is subject to the Gross Philippine Billings (GPB) Tax of 2½ % imposed under Section 28(A)(3)(a) and (b) of the NIRC, as amended, unless it is subject to a preferential rate or exemption on the basis of an applicable tax treaty or international agreement to which the Philippines is a signatory or on the basis of ‘reciprocity.’
In computing for GPB of international air carriers, there shall be included the total amount of gross revenue derived from passage of persons, excess baggage, cargo and/or mail, originating from the Philippines in a continuous and uninterrupted flight, irrespective of the place of sale or issue and the place of payment of the passage documents.
The gross revenue for passengers whose tickets are sold in the Philippines shall be the actual amount derived for transportation services, for a first class, business class or economy class passage, as the case may be, on its continuous and uninterrupted flight from any port or point in the Philippines to its final destination in any port or point of a foreign country, as reflected in the remittance area of the tax coupon forming an integral part of the plane ticket. For this purpose, the GPB shall be determined by computing the monthly average net fare of all the tax coupons of plane tickets issued for the month per point of final destination, per class of passage (i.e., first class, business class, or economy class) and per classification of passenger (i.e., adult, child or infant), and multiplied by the corresponding total number of passengers flown for the month as declared in the flight manifest.
For tickets sold outside the Philippines, the gross revenue for passengers for first class, business class or economy class passage, as the case may be, on a continuous and uninterrupted flight from any port or point in the Philippines to final destination in any port or point of a foreign country shall be determined using the locally available net fares applicable to such flight taking into consideration the seasonal fare rate established at the time of the flight, the class of passage (whether first class, business class, economy class or non-revenue), the classification of passenger (whether adult, child or infant), the date of embarkation, and the place of final destination. Correspondingly, the GPB for tickets sold outside the Philippines shall be determined in the manner as provided in the preceding paragraph.
Passage documents or tickets revalidated, exchanged and/or endorsed to another on-line international airline shall be included in the taxable base of the carrying airline and shall be subject to GPB tax if the passenger is lifted/boarded on an aircraft from any port or point in the Philippines towards a foreign destination.
The gross revenue on excess baggage which originated from any port or point in the Philippines and destined to any part of a foreign country shall be computed based on the actual revenue derived as appearing on the official receipt or any similar document for the said transaction.
The gross revenue for freight or cargo and mail shall be determined based on the revenue realized from the carriage thereof. The amount realized for freight or cargo shall be based on the amount appearing on the airway bill after deducting therefrom the amount of discounts granted which shall be validated using the monthly cargo sales reports generated by the International Air Transport Association Cargo Accounts Settlement System (IATA CASS) for airway bills issued through their cargo agents or the monthly reports prepared by the airline themselves or by their general sales agents for direct issues made. The amount realized for mails shall, on the other hand, be determined based on the amount as reflected in the cargo manifest of the carrier. Provided, however, that in the case of the passenger's passage documents or flights from any port or point in the Philippines and back, that portion of revenue pertaining to the return trip to the Philippines shall not be included as part of GPB.
In the case of a flight that originates from the Philippines but transshipment of passenger, excess baggage, cargo and/or mail takes place elsewhere in another aircraft belonging to a different airline company, the GPB shall be determined based on that portion of the revenue corresponding to the leg flown from any point in the Philippines to the point of transshipment.
In cases where a flight is interrupted by force majeure resulting in the transshipment of the passengers, their excess baggage, freight, cargo and/or mail to another airplane operated by another airline company and transshipment takes place in another country, the GPB shall be determined based on that portion of flight from the Philippines up to the point of said transshipment.
In computing the taxable amount, the foreign exchange conversion rate to be used shall be the average monthly Airline Rate as provided in the Bank Settlement Plan (BSP) monthly sales report or the Bankers Association of the Philippines (BAP) rate, whichever is higher. The average monthly BAP rate shall be computed by adding all the different BAP rates during the month and dividing the same by the number of days during the month.
Adequate schedules, records and documents, such as but not limited to those specified in the Regulations, shall be kept and maintained at all times in the local principal office or place of business of the international airline and shall be made available to the assigned internal revenue officers for verification of the gross revenues reported for Gross Philippine Billings Tax purposes.
In computing for GPB of international sea carriers, there shall be included the total amount of gross revenue whether for passenger, cargo, and/or mail originating from the Philippines up to final destination, regardless of the place of sale or payments of the passage or freight documents.
In proper cases, the domestic shipping agent shall apply for a Taxpayer Identification Number (TIN) for each foreign international shipping line it represents. Each foreign international shipping line is by itself a taxpayer separate and distinct from the agent and the other principals of the same agent. For purposes of registration and securing the TIN of the principal/s, the shipping agent must submit the Agency Agreement between him and his principal/s which will suffice as the documentation requirement. The shipping agent shall file the pertinent tax returns for each principal using the TIN and name of the particular principal. The shipping agent should not use its own TIN in filing the returns of the principal it represents.
Non-revenue passengers of international air and sea carriers shall not be given value for purposes of computing the taxable base subject to tax. Refunded tickets shall likewise not be included in the computation of GPB.
A Statement of GPB duly certified by an independent Certified Public Accountant, showing, among others, the Taxable Passenger Revenue for each flight number or voyage, the cumulative quarterly/annual summary as well as the monthly summary totals of gross revenue derived from the uplifts/transport of passengers, excess baggage, cargo and mails from the Philippines subject to tax under Section 28(A)(3) of the NIRC, as amended, the applicable average conversion rate mentioned in Sec. 4.1(A) of these Regulations to arrive at the Taxable GPB, and the GPB rate used in arriving at the tax due for the quarter/year shall be attached to the quarterly and annual GPB returns, to be filed by international carriers. The Audited Financial Statements shall also be attached to the annual GPB returns even in cases of no-payment returns due to tax exemption.
Under Section 28(A)(3) of the NIRC, as amended by RA No. 10378, international carriers doing business in the Philippines may avail of a preferential Income Tax rate or Income Tax exemption on their gross revenues derived from the carriage of persons and their excess baggage based on the principle of reciprocity or applicable tax treaty or international agreement to which the Philippines is a signatory.
Tax Treaties generally allow the Philippines to impose preferential Income Tax rates on profits from the operation of ships or aircrafts in international traffic by residents of the other contracting states. There are Tax Treaties which provide that the tax shall not exceed the lesser of 1½ % of the gross revenues derived from sources in the Philippines, or the lowest rate of the Philippine tax that may be imposed on profits of the same kind derived under similar circumstances by a resident of a third State.
In order to avail of the preferential Income Tax rates under Tax Treaties, international carriers shall observe the procedures stated in Revenue Memorandum Order No. 072-10 (Guidelines on the Processing of Tax Treaty Relief Applications (TTRA) Pursuant to Existing Philippine Tax Treaties). Accordingly, a TTRA is required to be filed with the International Tax Affairs Division (ITAD) of the BIR and duly approved by the Commissioner of Internal Revenue or his/her duly authorized representative before an international carrier may be entitled to avail of the preferential rate.
A TTRA filed by and/or granted to an international carrier prior to the effective date of these Regulations shall remain valid and binding, thus dispensing with the need for such international carrier to file a new TTRA under these Regulations. While RA No. 10378 recognizes international agreements as basis for granting exemption or preferential tax rate to international carriers, the Philippines, to date, has not negotiated any agreement with another state or jurisdiction providing for income tax exemption or preferential tax treatment to international carriers aside from tax treaties.
The principle of reciprocity may be invoked by an international carrier as basis for GPB tax exemption when its Home Country grants Income Tax exemption to Philippine carriers. The domestic law of the Home Country granting exemption shall cover Income Taxes and shall not refer to other types of taxes that may be imposed by the relevant taxing jurisdiction. The fact that the tax laws of the Home Country provide for exemption from business tax, such as gross sales tax, in respect of the operations of Philippine carriers shall not be considered as valid and sufficient basis for exempting an international carrier from Philippine Income Tax on account of reciprocity.
Reciprocity requires that Philippine carriers operating in the Home Country of an international carrier are actually enjoying the Income Tax exemption. The procedures to be observed in order to avail exemption from GPB Tax on the basis of “reciprocity” are specified in these Regulations. An off-line international carrier having a branch/office or a sales agent in the Philippines which sells passage documents for compensation or commission to cover off-line flights/voyages of its principal or head office, or for other airlines/sea carriers covering flights/voyages originating from Philippine ports or off-line flights/voyages, is not considered engaged in business as an international carrier in the Philippines and is, therefore, not subject to GPB Tax provided for in Section 28(A)(3) of the NIRC, as amended. Nevertheless, an off-line international carrier shall be subject to the regular rate of Income Tax under Section 28(A)(1) of the NIRC, as amended, based on its taxable income from sources within the Philippines. All items of income derived by international carriers that do not form part of GPB, as defined under these Regulations, shall be subject to tax under the pertinent provisions of the NIRC, as amended.
Demurrage fees, which are in the nature of rent for the use of property of the carrier in the Philippines, is considered income from Philippine source and is subject to Income Tax under the regular rate as the other types of income of the on-line carrier. Detention fees and other charges relating to outbound cargoes and inbound cargoes are all considered Philippine-sourced income of international sea carriers they being collected for the use of property or rendition of services in the Philippines, and are subject to the Philippine Income Tax under the regular rate.
International air carriers and shipping carriers doing business in the Philippines on their gross receipts derived from the transport of cargo from the Philippines to another country shall pay a Common Carrier’s Tax (Percentage Tax on International Carriers) equivalent to 3% of their quarterly gross receipts pursuant to Section 118 of the NIRC, as amended by RA No. 10378.
For purposes of determining the said Common Carrier’s Tax liability of international carriers, “gross receipts” shall include, but shall not be limited to, the total amount of money or its equivalent representing the contract, freight/cargo fees, mail fees, deposits applied as payments, advance payments and other service charges and fees actually or constructively received during the taxable quarter from cargo and/or mail, originating from the Philippines in a continuous and uninterrupted flight, irrespective of the place of sale or issue and the place of payment of the passage documents.
In cases when the GPB Tax provided for in Section 28(A)(3) of the NIRC, as amended, is not applicable, the Common Carrier’s Tax imposed under Section 118 of the NIRC, as amended, shall still apply. Provided that, an off-line international carrier having a branch/office or a sales agent in the Philippines which sells passage documents for compensation or commission to cover off-line flights or voyages of its principal or head office, or for other airlines/sea carriers covering flights or voyages originating from Philippine ports or off-line flights or voyages, is not considered engaged in business as an international carrier in the Philippines and is, therefore, not subject to the 3% Common Carrier's Tax under Section 118(A) of the NIRC, as amended. This provision is without prejudice to classifying such taxpayer under a different category pursuant to a separate provision of the NIRC.
The transport of passengers by international carriers doing business in the Philippines shall be exempt from Value-Added Tax (VAT) pursuant to Sections 109(1)(S) of the NIRC, as amended by RA No. 10378. The transport of cargo by international carriers doing business in the Philippines shall be exempt from VAT pursuant to Sections 109(1)(E) of the NIRC, as amended by RA No. 10378, as the same is subject to Common Carrier’s Tax (Percentage Tax on International Carriers) under Section 118 of the NIRC, as amended. International carriers exempt under Sections 109(1)(S) and 109(1)(E) of the NIRC, as amended, shall not be allowed to register for VAT purposes.
International carriers, through their authorized personnel or representative, shall submit to International Tax Affair Division a sworn certification stating that there is no change in the domestic laws of its Home Country granting Income Tax exemption to Philippine carriers. The sworn certification shall be submitted on or before January 31 of each year from the time the international carrier was issued a ruling by the BIR confirming its GPB Tax exemption on the basis of reciprocity. Failure to submit the sworn certification shall be a ground for the revocation of such ruling.
(Published in Manila Bulletin on September 20, 2013)
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Wednesday, October 9, 2013
RR No. 14-2013
REVENUE REGULATIONS NO. 14-2013 issued on September 20, 2013 amends pertinent provisions of Revenue Regulations (RR) No. 02-98, as last amended by RR No. 30-2003 and RR No. 17-2003.
Any amount collected for and paid to medical practitioners (which include doctors of medicine, doctors of veterinary science and dentists) by hospitals and clinics or paid directly to the medical practitioners by health maintenance organizations (HMOs) and/or similar establishments shall be subject to creditable withholding tax of 15%, if the income payments to the medical practitioner for the current year exceeds P 720,000.00; and 10%, if otherwise.
It shall be the duty and responsibility of the hospitals, clinics, HMOs and similar establishments to withhold and remit taxes due on the professional fees of their respective accredited medical practitioners, paid by patients who were admitted and confined to such hospitals and clinics.
Hospitals, clinics, HMOs and similar establishments must ensure that correct taxes due on the professional fees of their medical practitioners have been withheld and timely remitted to the Bureau of Internal Revenue (BIR). For this purpose, hospitals and clinics shall not allow their medical practitioners to receive payment of professional fees directly from patients who were admitted and confined to such hospital or clinic and, instead, must include the professional fees in the total medical bill of the patient which shall be payable directly to the hospital or clinic.
Hospitals and clinics shall be responsible for the accurate computation of taxes to be withheld on professional fees paid by patients thru the hospitals and clinics, in the same way that HMOs shall be responsible for the computation of taxes to be withheld from the professional fees paid by them to the medical practitioners, and timely remittance of the 10% or 15% expanded withholding tax, whichever is applicable.
The said withholding tax shall not apply whenever there is proof that no professional fee has in fact been charged by the medical practitioner and paid by his patient. Provided, however, that this fact is shown in a sworn declaration jointly executed by the medical practitioner, and the patient or his duly authorized representative, in case the patient is a minor or otherwise incapacitated. This sworn declaration, to be executed in the form presented in Annex “A” of these Regulations, shall form part of the records of the hospital or clinic and shall constitute as part of its records shall be made readily available to any duly authorized Revenue Officer for tax audit purpose. Provided, further, that the said administrator of the hospital or clinic shall inform the Revenue District Office having jurisdiction over such hospital or clinic about any medical practitioner who fails or refuses to execute the prescribed sworn statement within 10 days from the occurrence of such event.
Hospitals and clinics shall submit to the BIR the names and addresses of medical practitioners in the following classifications, every 15th day after the end of each calendar quarter:
i. Medical practitioners whose professional fee was paid by the patients directly to the hospital or clinic.
ii. Medical practitioners who did not charge any professional fee from their patients.
All hospitals and clinics shall likewise submit to the BIR (Collection Division of the Regional Office having jurisdiction over the place where the income earner is registered/Large Taxpayers Collection Division for large taxpayers in Metro Manila/LTDO for large taxpayers outside Metro Manila) a sworn statement executed by the president/managing partner of the corporation/company as to the complete and updated list of medical practitioners accredited with them.
The provisions of these Regulations shall take effect on October 1, 2013.
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Tuesday, October 8, 2013
RR No. 13-2013
REVENUE REGULATIONS NO. 13-2013 issued on September 20, 2013 amends Section 2 (b) of Revenue Regulations No. 13-08 relative to the definition of raw sugar for Value-Added Tax purposes.
Said Section is amended to read as follows:
Said Section is amended to read as follows:
“(b) Raw sugar – refers to sugar produced by simple process of conversion of sugar cane without a need of any of mechanical or similar device such as muscovado. For this purpose, raw sugar refers only to muscovado sugar.
Centrifugal process of producing sugar is not in itself a simple process. Therefore, any type of sugar produced therefrom is not exempt from VAT.”
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RMO No. 26-2013
REVENUE MEMORANDUM ORDER NO.
26-2013 issued on October 1, 2013 Implements the BIR Strategic Performance Management System
Date Issued - October 1, 2013
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Date Issued - October 1, 2013
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Monday, October 7, 2013
RMO No. 25-2013
REVENUE MEMORANDUM ORDER NO.
25-2013 issued on September 30, 2013 Prescribes additional guidelines in the office performance evaluation of Large Taxpayers Service.
Date Issued - September 30, 2013
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Date Issued - September 30, 2013
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Saturday, October 5, 2013
RMO No. 24-2013
REVENUE MEMORANDUM ORDER NO. 24-2013 issued on September 11, 2013 prescribes the policies, guidelines and procedures on the use of Electronic BIR Forms (eBIRForms) in relation to Revenue Memorandum Circular (RMC) No. 61-2012.
The prescribed policies, guidelines and procedures shall be applicable to non-Electronic Filing and Payment System (non-eFPS) filers and to Accredited Tax Agents (ATAs) filing in behalf of their clients who are non-eFPS filers.
The Offline eBIRForms Package shall be available for use by all non-eFPS filers with or without internet access for the preparation of tax returns, while the Online eBIRForms System shall be available for internet users for electronic submission or filing of tax returns.
Non-eFPS filers or taxpayers have the option to use the pre-printed BIR Forms available at various Revenue District Offices (RDOs) or use the Offline eBIRForms Package for the preparation of required tax returns.
Non-eFPS filers who shall file tax returns “without payment” (or ‘no payment returns’) may opt to submit their tax returns at their respective RDOs manually or electronically submit the same through the use of the Online eBIRForms System. Non-eFPS filers who shall file tax returns “with payment” may submit the mandatory tax returns and pay the corresponding taxes due through the Authorized Agent Banks (AABs) within the jurisdiction of their registered RDO or the Revenue Collection Officers (RCOs), whichever is applicable. They may also file tax returns through the Online eBIRForms System and pay through the Electronic Banking (e-Banking) facilities of the AABs and other existing tax payment channels.
Non-eFPS filers may assign or designate an ATAs who shall represent them before the BIR in the preparation and filing of tax returns upon online enrolment with the Online eBIRForms System and upon submission of a duly notarized Authorization Letter to the taxpayer’s registered RDO for account activation. The ATAs who are preparing and filing tax returns in behalf of their clients are mandated to use the eBIRForms.
Tax Software Providers (TSPs) who provided tax preparation software to their clients must also enroll with the Online eBIRForms System to test and certify the outputs of the said software. Only a system-certified TSP tax preparation software shall be accepted by the Online eBIRForms System.
Tax agents or practitioners who are exempted to undergo accreditation proceedings pursuant to Revenue Regulations No. 11-2006 are required to apply for accreditation by following the prescribed procedures in existing rules and regulations. Subsequently, the said tax agents or practitioners will be able to register and access the Online eBIRForms System as “Accredited Tax Agent” to be able to represent their client in the preparation and filing of returns.
The designation of ATA by the taxpayer may, at any time, be cancelled or revoked upon execution of “Removal of Tax Agent” within the Online eBIRForms System and the aforementioned action shall be completed upon submission of a duly notarized Notice of Termination to the taxpayer’s registered RDO.
Any findings, errors, violations or infractions noted by the Regional and District Offices on tax returns prepared, signed and filed by ATAs in behalf of their clients shall render both the taxpayer and his/its tax agent civilly, administratively and criminally liable pursuant to RMC No. 82-2007, as amended.
The policies and guidelines on the use of the Offline eBIRForms Package and Online eBIRForms System are specified in the Order.
Individual and corporate taxpayers shall be allowed to register or enroll up to a maximum of 3 user accounts for a particular Tax Identification Number (TIN) on the use of Online eBIRForms System. In case of unsuccessful validation of user’s account enrolment due to information mismatch, the taxpayer, ATA or TSP must submit BIR Form 1905 (Update on Registration Information) to his registered RDO for the information update with the Integrated Tax System database.
For juridical or artificial entities, online enrolment shall be made by officers required by law to file the returns, such as but not limited to the following:
- For domestic corporations: the President, Vice President or Treasurer;
- For partnerships: the managing partner;
- For joint ventures: the managing head;
- For resident foreign corporations: the Head Country Manager.
- For partnerships: the managing partner;
- For joint ventures: the managing head;
- For resident foreign corporations: the Head Country Manager.
In relation to Section V(C)(5) of the Order, the authorized principal officer may delegate the enrolment and filing of returns provided that a duly notarized authorization certificate was issued by the principal officer/s to the identified company personnel. In case of change of authorized company representative, the principal officer shall request for password reset from their respective RDO and shall issue another duly notarized authorization certificate to the newly-identified company personnel.
All accredited tax agents or practitioners shall initially use the Offline eBIRForms Package for the preparation of tax returns. The duly accomplished returns shall be filed manually and the tax due shall be paid at any AAB located within the territorial jurisdiction of the RDO where the non-eFPS taxpayer they represent is registered. In case of ‘no payment returns’, the same shall be filed manually with the RDO where the taxpayer they represent is registered or with the concerned RCO under the same RDO, whichever is applicable.
The use of the Online eBIRForms System shall be used upon availability of the system to be announced by the BIR.
Date Issued - September 30, 2013
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RMO No. 23-2013
REVENUE MEMORANDUM ORDER NO. 23-2013 issued on August 8, 2013 prescribes the guidelines and procedures for the implementation of the Electronic Official Register Book (eORB) System, which shall be initially implemented in the major tobacco companies identified by the BIR. Subsequently, a Notice of eORB Implementation shall be issued to other tobacco companies. Taxpayers notified/informed to use the eORB system shall no longer submit the hard copy(ies) of eORB Form.
The process owner of the eORB system shall be the Large Taxpayers Service (LTS) with the Chief of Excise LT Field Operations Division (ELTFOD) as the designated authorized approving officer. The authority of the Chief, ELTFOD shall include the approval of the enrolment form as well as the approval of any amendment to the submitted eORB forms and Excise Tax deposits.
The Excise LT Regulatory Division (ELTRD) shall encode/update into the eORB System all the pertinent information contained in the approved Permit to Operate and registration permits for brand of tobacco products within 24 hours immediately upon approval of the application.
The LT Performance Monitoring and Programs Division (LTPMPD) shall generate and download/print removal and collection reports generated by the eORB System, for purposes of preparing Excise Tax collections for submission to top management.
The operations and user’s manual containing all the procedural requirements for the use of the eORB System may be downloaded thru the eORB icon from the BIR website (www.bir.gov.ph). With respect to other requirements that are incidental in the usage of the eORB System, the procedures specified in the Order shall be observed.
Any violation of the provisions in the Order shall be subject to administrative disciplinary action and shall be dealt with accordingly. Moreover, in cases where the taxpayer failed to use/maintain the eORB System as well as submit the eORB Form to the BIR through the facility of the said System, the same constitutes a violation of Section 153 of the National Internal Revenue Code, as amended, upon which the penalty of P 1,000.00 for each failure shall be imposed; provided that the aggregate amount to be imposed for such failures during a calendar year shall not exceed P 25,000.00 pursuant to the provisions of Section 250 of the same Code.
Date Issued - August 8, 2013
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RMO No. 22-2013
REVENUE MEMORANDUM ORDER NO. 22-2013 issued on July 31, 2013 amends Revenue Memorandum Order No. 9-2012 by including the Project Management and Implementation Service in its coverage for the placement of personnel pursuant to the approved Notice of Organization, Staffing and Compensation Action (NOSCA) relative to the BIR Rationalization Plan under Executive Order No.366.
Date Issued - July 31, 2013
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Wednesday, October 2, 2013
RMO No. 21-2013
REVENUE MEMORANDUM ORDER NO. 21-2013 issued on July 23, 2013 amends the provisions of Revenue Memorandum Order (RMO) No. 35-2002, as amended by RMO No. 20-2006, prescribing the guidelines and procedures in the processing and issuance of Authority to Release Imported Goods (ATRIG) for Excise Tax purposes.
The provisions prescribed under the Policies and Guidelines of RMO No. 35-2002, as amended by RMO No. 20-2006, was amended to read as follows:
“II. POLICIES AND GUIDELINES
1. xxx
xxx
With respect to the importation of automobiles defined under Republic Act No. 9224, one (1) ATRIG shall be issued for each unit of automobile with a net importer’s price of over two million one hundred thousand pesos (P2,100,000.00), excluding value-added and excise taxes; Provided, however, that in cases of importation having a single Bill of Lading but consisting of several automobiles with importer’s selling prices of P2,100,000.00 or less and over P2,100,000.00, excluding value-added and excise taxes, one (1) ATRIG shall still be issued for every unit of automobile, regardless of the net importer’s selling price; Provided, finally, that, pending enhancement of the Philippine National Single Window System on ATRIG, a separate notarized application for ATRIG shall be filed and signed by the importer or his duly authorized representative, with the prescribed documentary stamp affixed thereon, for each and every unit of automobile pursuant to this sub-paragraph.
2. xxx ”
Date Issued - July 23, 2013
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Tuesday, October 1, 2013
RMO No. 20-2013
REVENUE MEMORANDUM ORDER NO. 20-2013 issued on July 22, 2013 prescribes the policies and guidelines in the issuance of Tax Exemption Rulings to qualified nonstock, non-profit corporations and associations under Section 30 of the National Internal Revenue Code (NIRC) of 1997, as amended
Corporations and associations enumerated under Section 30 of the NIRC, as amended, including those which have been issued tax exemption rulings/certificates prior to June 30, 2012, shall file their respective Applications for Tax Exemption/Revalidation with the Revenue District Office (RDO) where they are registered. Only corporations or associations that are duly qualified under Section 30 of the NIRC, as amended, shall be issued Tax Exemption Rulings.
A corporation or association shall submit the following documents:
a. Original copy of application letter for issuance of Tax Exemption Ruling. The
letter shall cite the particular paragraph of Section 30 of the NIRC, as
amended, under which the application for exemption/revalidation is being
based;
b. Certified true copy of the latest Articles of Incorporation and By-Laws issued
by the Securities and Exchange Commission;
c. Original copy of Certification under Oath by an executive officer of the
corporation or association as to: (i) all previous amendments/changes in the
Articles of Incorporation and By-Laws, (ii) manner of activities, and (iii) the
sources and disposition of income, if any, of the subject corporation or
association. If there are no amendments/changes, the Certification shall state
this fact;
d. Certified true copy of the Certificate of Registration with the BIR;
e. Original copy of the Certification under Oath by the Treasurer of the
corporation or association as to the amount of income, compensation,
salaries or any emoluments paid by the corporation or association to its
trustees, officers and other executive officers. Provided, that, a corporation
sole, which, by its nature, does not have trustees, corporate officers or
executive officers need not submit the certification required under this
subparagraph.
f. Original copy of the Certification issued by the RDO where the corporation or
association is registered that the corporation or association is not the subject
of any pending investigation, on-going audit, pending tax assessment,
administrative protest, claim for refund or issuance of tax credit certificate,
collection proceedings, or a judicial appeal; or if there be any, the original
copy of the Certification issued by the RDO on the status thereof;
g. Certified true copies of the Income Tax Returns or Annual Information
Returns and Financial Statements of the corporation or association for the
last three (3) years; and
h. Original copy of a statement under Oath by an executive officer of the
corporation or association as to its modus operandi which shall include:
i. A full description of the past, present and proposed activities of the
corporation or association;
ii. A narrative description of anticipated receipts and contemplated
expenditures; and
iii. A detailed description of all revenues which it seeks to be exempted from
Income Tax. All other revenues which are not included in the statement/
application shall be subject to Income Tax.
In addition to the said requirements, a non-stock and non-profit educational institution under Section 30(H) of the NIRC, as amended, shall submit the following documents:
a. Certified true copy of government recognition/permit/accreditation to operate as an educational institution issued by the Commission on Higher Education (CHED), Department of Education (DepEd), or Technical Education and Skills Development Authority (TESDA);
b. If the government recognition/permit/accreditation to operate as an education institution was issued more than five (5) years prior to the application for tax exemption/revalidation, an original copy of a current Certificate of Operation/Good Standing, or other equivalent document, issued by the appropriate government agency (i.e., CHED, DepEd, or TESDA) shall be submitted as proof that the non-stock and non-profit educational institution is currently operating as such; and
c. Original copy of Certificate of utilization of annual revenues and assets by the Treasurer or his equivalent of the non-stock and non-profit educational institution. In accordance with the guidelines set forth in Section 1.3 of Department of Finance (DOF) Order No. 137-87, the Certificate shall provide a breakdown of the following:
i. Any amount in cash or in kind (including administrative expenses) paid or utilized to accomplish one or more purposes for which the educational institution was created or organized, including grant of scholarship to deserving students and professorial chairs for the enhancement of professional course.
ii. Any amount paid to acquire an asset used (or held for use) directly in carrying out one or more purposes for which it was created or organized, including the upgrading of existing facilities to support the conduct of the above activities.
iii. Any amount in cash or in kind invested in an activity related to the educational purposes for which it was created or organized.
iv. Any amount set aside for a specific project, which must be supported by a Board Resolution issued by the school administration on proposed projects (i.e., construction and/or improvement of school buildings and facilities, acquisition of equipment, books and the like) to be funded out of the money deposited in banks or placed in money markets, on or before the 15th day of the fourth month following the end of its taxable year.
The general guidelines in the evaluation of the applications for tax exemptions/revalidation as well as the specific guidelines in the evaluation of the application of corporations or associations under Section 30(E) of the NIRC, as amended, are specified in the Order.
A Tax Exemption Ruling issued under this Order shall be valid for a period of three (3) years from the date of effectivity specified in the Ruling, unless sooner revoked or cancelled. The Tax Exemption Ruling shall be deemed revoked if there are material changes in the character, purpose, or method of operation of the corporation or association which are inconsistent with the basis for its Income Tax exemption. The revocation takes effect as of the date of the material change.
Tax Exemption Rulings may be renewed upon filing of a subseguent Application for Tax Exemption/Revalidation, under same requirements and procedures provided herein. Otherwise, the exemption shall be deemed revoked upon the expiration of the
Tax Exemption Ruling. The new Tax Exemption Ruling shall be valid for another period of three (3) years, unless sooner revoked or cancelled.
If a corporation or association, which has been issued a Tax Exemption Ruling, fails to file its annual information return, it shall automatically lose its income tax-exempt status beginning the taxable year for which it failed to file an annual information return, in addition to the sanctions imposed under Section 250 of the NIRC, as amended.
Tax exemption rulings or certificates issued to corporations or associations listed under Section 30 of the NIRC, as amended, prior to June 30, 2012 shall be valid until December 31, 2013. Tax exemption rulings or certificates issued after June 30, 2012 shall continue to be valid for a period of three (3) years from date of issuance, unless sooner revoked or cancelled.
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