Coverage And Classification of Taxpayers - BIR Revenue Regulations (RR) No. 8-2024

In relation with the "Ease of Paying Taxes Act", the bureau has issued Revenue Regulations (RR) No. 8-2024 implementing Section 21(b) of the Tax Code on the classification of taxpayers.

Section 2 of these regulations has stated the Coverage and Classification of Taxpayers as follows:

A. Micro Taxpayer - shall refer to a taxpayer whose gross sales for  a taxable year is less than Three Million Pesos (P3,000,000.00).

B. Small Taxpayer - shall refer to a taxpayer whose gross sales for a taxable year is Three Millions Pesos (P3,000,000.00) to less than Twenty Million Pesos (P20,000,000.00).

C. Medium Taxpayer - shall refer to a taxpayer whose gross sales for a taxable year is Twenty Million Pesos (P20,000,000.00) to less than One Billion Pesos (P1,000,000,000.00).

D. Large Taxpayer - shall refer to a taxpayer whose gross sales for a taxable year is One Billion Pesos (P1,000,000,000.00) and above. 

For purpose of classification of taxpayers, under these Regulations, gross sales shall refer to total sales revenue, net of VAT, if applicable, during the taxable year, without any other deductions.

Please refer .https://www.bir.gov.ph/images/bir_files/internal_communications_1/Full%20Text%20RR%202024/RR%20No.%208-%202024.pdf of the full text of RR No. 8-2024.

Updated Version of the Alphalist Data Entry and Validation Module (Version 7.2)

Recently, the bureau has issued a Tax Advisory with regards of the updated version of the Alphalist Data Entry and Validation Module (Version 7.2) which is available for use for the update the Monthly Alphalist of Payees (MAP); Quarterly Alphalist of Payees (QAP); Summary Alpahlist of Withholding Taxes (SAWT) and Annual Information Return of Income Taxes Withheld On Compensation and Final Withholding Taxes (1604 C); Annual Information Return of Creditable Income Taxes Withheld (EXPANDED)/ Income Payments Exempt From Withholding Tax (1604 E) and Annual Information Return of Income Taxes Withhold On Compensation and Final Withholding Taxes (1604 F).

Please refer https://www.bir.gov.ph/images/bir_files/internal_communications_1/Advisory/2024/TAX%20ADVISORY-%20ALPHALIST%20DATA%20ENTRY%20AND%20VALIDATION%20MODULE%20VERSION%207.2.pdf of the Tax Advisory.

Availability of BIR Form Nos. 1700 and 2000 in the eFPS

The bureau has issued Revenue Memorandum Circular (RMC) No. 18-2024 to inform the taxpayers of the availability of BIR Form Nos. 1700 and 2000 in the Electronic Filing and Payment System (eFPS) as follows:

1. BIR Form No. 1700 (Annual Income Tax Return for Individuals Earning Purely Compensation Income (Including Non-Business/Non-Profession Related Income) - Due on or before April 15 of each year covering income for the preceding taxable year.

2. BIR Form No. 2000 (Monthly Documentary Stamp Tax Declaration/Return) - Due within five (5) days after the close of the month when the taxable document was made, signed, issued, accepted or transferred (or when reloading a metering machine becomes necessary or upon remittance by avenue collection agents of collection from the sale of loose stamps.

Please refer: https://www.bir.gov.ph/images/bir_files/internal_communications_2/RMCs/2024%20RMCs/RMC%20No.%2018-2024.pdf of the full text of RMC No. 18-2024.

New Selling Price Threshold of the Sale of House and Lot, and Other Residential Dwellings for VAT Exemption Purposes

As per Revenue Regulations (RR) No. 1-2024 dated January 10, 2024, the Selling Price Threshold of the Sale of House and Lot, and Other Residential Dwellings is adjusted to Three Million One Hundred Ninety-Nine Thousand Two Hundred (Php3,199,200.00) Pesos for Value-Added Tax (VAT) Exemption Purposes.

Please refer the https://www.bir.gov.ph/images/bir_files/internal_communications_1/Full%20Text%20RR%202024/RR%20No.%201-2024.pdf of the full text of RR No. 1-2024.

New Offline eBIRForms Package v7.9.4.2

The bureau has updated the version of the Bureau of Internal Revenue (BIR) Offline eBIRForms Package from v7.9.4.1 to v7.9.4.2 as part of ease of filing of the BIR returns and payment of taxes of an ease of doing business of the taxpayers in the community.  

To new Offline eBIRForms Package v7.9.4.2 is available for down load at BIR Website (www.bir.gov.ph)

BIR Annual Registration Fee (ARF) is no longer required Effective January 22, 2024

As part of ease of doing business in the community, the Bureau of Internal Revenue (BIR) has issued an advisory on January 8, 2024 that the Business Taxpayers is no longer required to pay the Annual Registration Fee (ARF) of Five Hundred Pesos (PHP500.00) effective January 22, 2024 in compliance with Republic Act No. 11976, the "Ease of Paying Taxes Act." With this, business taxpayers are exempt from filing BIR Form No. 0605 and paying the Five Hundred Pesos (PHP500.00) ARF on or before January 31 every year or annually.

Besides, Business taxpayers with existing BIR Certificate of Registration (COR) that includes Registration Fee will retain its validity. These taxpayers may choose to update / replace their COR at the BIR Revenue District Office where they are registered on or before December 31, 2024, by surrendering their old COR.

 Please refer   https://www.bir.gov.ph/images/bir_files/internal_communications_1/2024/Advisories/Advisory_ARF.pdf of the full text of the Advisory from BIR.

Updated Features and Functionalities of BIR Online Registration and Update System (ORUS)

For ease of doing business of the taxpayers in the community, the bureau has issued Revenue Memorandum Circular (RMC) No. 121- 2023 dated November 29, 2023 announcing the Updated Features and Functionalities of the Online Registration and Update System (ORUS) starting November 21, 2023.

The additional features and functionalities of ORUS are now available online as follows:

1. Taxpayer Identification Number (TIN) Inquiry;

2. Access to Digital TIN ID; and

3.  Availability of MyEG as one of the online payment facilities in ORUS

The three functionalities added are as follows:

1. Primary Registration

2.  Secondary Registration 

3. Registration Information Update

Taxpayers who have an existing ORUS may access and avail the online registration updates and other functionalities and taxpayers who do no not have an ORUS account and opted to use the said online registration-related facilities are required to enroll or create an account on ORUS following the guidelines prescribed under RMC No. 122-2022.

Please consider the link: https://www.bir.gov.ph/images/bir_files/internal_communications_2/RMCs/2023%20RMCs/RMC%20No.%20121-2023.pdf of the full text of RMC No. 121-2023.

New eBIRForms Package Version7.9.4.1

The bureau has issued Revenue Memorandum Circular (RMC) No. 122-2023 regarding the availability of the Offline Electronic Bureau of Internal Revenue Forms (eBIRForms) Package Version7.9.4.1 to update the Offiline eBIRForms Package v7.9.4 that contains the modifications as follows:

 1.  Additional Alphanumeric Tax Codes (ATCs) in BIR Form No. 1702-RTv2018C;

 2. Updated 2023 Income Tax Rates of BIR Forms No. 1700v2018; 1701v2018 & 1701A;

3. Bug fixes for BIR Forms No. 1702-MXv2018C.

The eBIRForms Package v7.9.4.1 can be downloaded from the webistes: www.bir.gov.ph and www.knowyourtaxes.ph/ebirforms

Please consider the link: https://www.bir.gov.ph/images/bir_files/internal_communications_2/RMCs/2023%20RMCs/RMC%20No.%20122-2023_copy.pdf of the full text of RCM No. 122-2023 dated November 24, 2023.

Imposing Creditable Withholding Tax on Certain Income Payments by Joint Ventures/Consortiums

The bureau has issued Revenue Regulations (RR) No. 14-2023 to further implement Section 57 (B) of the provisions of Sections 244 and 245 of the National Internal Revenue Code of 1997, as amended, and subsequently amend RR No. 2-98 by adding items (V) and (W) imposing creditable withholding tax on certain income payments by joint ventures/consortiums.

The amendments stated in RR No. 14-2023 are as follows:

SECTION 2. AMENDMENTS. - The pertinent provisions of Section 2.57.2 of RR No. 2-98, as amended, is hereby further amended to read as follows:

"Sec. 2.57.2. Income Payments Subject to Creditable Withholding Tax and Rates Prescribed Thereon. Except as herein otherwise provided, there shall be withheld a creditable income tax at the rates herein specified for each class of payee from the following items of income payments to persons residing in the Philippines:

xxx    xxx    xxx

(V) Income payment made by joint ventures/consortiums. - Income payments made by joint ventures, whether incorporated or not, taxable or non-taxable, to their local/resident supplier of goods and services, shall be subjected to the following withholding tax rates:

Supplier of goods - One percent (1%)

Supplier of services - Two percent (2%)

(W) Distributive share of co-ventures/members from the net income of the joint venture/consortium not taxable as corporation. - On the share of each co-venturer/member from the net income of the joint venture/consortium not taxable as corporation prior to actual or constructive distribution thereof - Fifteen percent (15%)

xxx     xxx     xxx"

 Please refer RR No. 14-2023 dated October 2, 2023 of the full text of the said regulations.

Exemption from Issuance of Receipts or Sales or Commercial Invoices by Agricultural Producers

Agricultural Producers have an important role of the growth and success of Agricultural Food Products (Farm Produce, Livestock, Poultry, Marine Product, Ordinary Salt & Agricultural Inputs) in the community. 

Revenue Regulations (RR) No. 12-2023 has issued by the bureau to implement Section 237 of the Tax Code, as amended, relative to the issuance of receipts or sales or commercial invoices by Agricultural Producers.

Under Section 4 of these Regulations has described the Exemption from Issuance of Receipts or Invoices for ease of doing business by the Agricultural Producers of their Agricultural Food Products, provided, that the gross sales/receipts for the year shall not exceed One Million Pesos (P1,000,000.00). Provided, further, however, that Agricultural Producers shall record each sale transaction in a simplified sales book containing the following information:

a. date of transaction;

b. description of goods sold or services rendered;

c. registered name, registered address, and Taxpayer Identification Number (TIN) of the purchaser if engaged in business;

d. amount of sales;

e. amount of tax withheld, if any, and the

f. net amount received

Provided, finally, if the annual gross sales/receipts exceed One Millions Pesos (P1,000,000.00) at any time during the taxable year, the Agricultural Producer shall be required to issue official receipt/sales invoices for every subsequent transaction valued at P100.00 or more. For this purpose, the Agricultural Producer, for the first year of business operation or one year from registration, shall be allowed to purchase and use BIR-printed receipts or BIR-printed invoices from the Revenue District Office (RDO) where they will register pursuant to Section 6 of these Regulations. The Agricultural Producer shall thereafter be require to issue official receipts/sales invoices printed pursuant to an Authority to Print (ATP).

The Agricultural Producer shall still be exempt from the issuance of receipt or invoice even if he or she derives income from the sale of goods or services other than Agricultural Food Products as described in these Regulations, provided that that, the annual aggregate gross sales/receipts shall not exceed One Million Pesos (P1,000,000.00). Provided further, the primary activity of the Agricultural Producer shall not exceed thirty percent (30%) of the aggregate sales or receipt of the Agricultural Producer for a given taxable year.

Please refer RR No. 12-2023 of the full text of these Regulations.