Period of Validity, Conversion and Revalidation of Unutilized Tax Credit Certificate

Revenue Regulations (RR) No. 14-2020 dated January 30, 2020 was issued by the bureau amending the Pertinent Provisions on Cash Conversion of Unutilized Tax Credit Certificate (TCC) under RR No. 5-2000. TCC represents the amount due to a taxpayer resulting from an overpayment of a tax liability or erroneous payment of a tax due. It may be applied for by the taxpayer instead of filing a claim for refund with the Bureau of Internal Revenue (BIR). It may be used as payment of any tax liability by way of applying for Tax Debit Memo (TDM) or may be converted into a cash, in case the taxpayer-owner has no longer use for it.

Period of Validity, Conversion and Revalidation

a. Vality Period - Any TCC issued which remains unutilized after five (5) years from the date of issue shall, unless revalidated before the end of the fifth year, be considered invalid. This means that the TCC shall not be allowed for use in payment of any taxpayer's internal revenue tax liability nor allowed to be transferred and the unutilized amount thereof shall revert to the General Fund of the National Government. (RR No. 5-2000) 

b. Conversion Period - Any request for conversion into cash refund of unutilized tax credits may be allowed during the validity period of the TCC. Provided, however, that the original copy of the Tax Credit Certificate showing a creditable balance is surrendered to the Asst. Commissioner, Collection Service or other duly authorized Revenue Officer for verification and cancellation. Provided, further, that a refund check of treasury warrant issued in accordance with the pertinent provisions of the Tax Code of 1997, as amended, which shall remain uncashed or unclaimed within five (5) years from the date of issue, mailing or delivery, whichever comes later, shall be forfeited in favor of the Government and the amount thereof shall revert to the general fund.

Provided furthermore, that, any TCC which remains unutilized for more than one (1) year at any given interval of time during its validity shall be converted into cash with prior written notice by the BIR, subject to the availability of funds in accordance with the procedural requirements that will be issued by the BIR for this purpose.

c. Revalidation Period - The revalidated TCC shall be valid for a period of five years from the date of issue. (RR No. 5-2000).

All TCCs which are already expired upon the effectivity of this Regulations shall be automatically cancelled by the BIR, except those TCCs which are with the BIR, for purposes of utilization thru TDM, conversion or revalidation, before the expiration of their respective dates of validity: Provided, however, that the list of expired TCCs and names of its taxpayers-owners shall be circularized/posted with the BIR's official website, within thirty (30) days from the date of effectivity of these Regulations. The said ciruclar or posting of the list is deemed a sufficient notice to the concerned taxpayer-owner of the TCC.

REFERENCES: 

RR No. 5-2000; RR No. 14-2020.

Extending the Deadline for Business Registration (activity and/or updates) of those into Digital Transactions

In relation with the global COVID-19 pandemic and when most citizens are into home quarantine while the business of selling goods and services through online network has been observed to be experiencing an increase growth in the community, the Bureau reminded the Deadline for  Business Registration of those into Digital Transactions. 

Revenue Memorandum Circular (RMC) No. 75-2020 is being issued extending the Deadline for Business Registration of those Transaction under RMC 60-2020 until August 31, 2020, specifically for the registration of the activity and/or updates and those who shall voluntarily declare their past transactions subject to pertinent taxes and pay the taxes due when declared and paid on or before the said date shall not be subject to corresponding penalty for late filing and payment.

Options in the Acceptance and Processing of the Filed 2019 Income Tax Returns and Its Required Attachments and Providing Guidelines Thereon

Revenue Memorandum Circular (RMC) No. 49-2020 has issued by the bureau to provide options to taxpayers in the submission of the filed 2019 Income Tax Return and its required attachments. Accordingly,taxpayers may opt to submit said requirements through the Revenue Collection Officers (RCOs) or through the on line eAFS. 

I. SUBMISSION THROUGH RCO 

Taxpayers may submit the required attachments to the Annual Income Tax Returns to the Revenue Collection Officer nearest to them, notwithstanding Revenue District Office jurisdiction. 

1. For income tax returns with payments made thru the online payment facility of the AAB, the RCOs/Cos shall: 

a. Stamp "Received" the returns; 

The attachments to the income tax returns shall be stamped only on the page of the Balance Sheet, the Income Statement and Audit Certificate, if applicable. The other pages of the financial statements and its attachments need not be stamped "Received". In case of corporations and other juridical persons at least 2 extra copies of the Audited Financial Statements for filing with the Securities and Exchange Commission (SEC) should be stamped "Received" pursuant to Revenue Memorandum Order (RMO) Nos. 6-2010 and 13-2011. 

b. Batch and forward these returns and their respective attachments to the concerned Document Processing Division of the Revenue Region. 

2. For income tax returns filed electronically, the RCOs/Cos shall accept and stamp ..Received,, only the copies of the Filing Reference Number generated from the eFPS/E-mail Confirmation from the eBIR Forms System and the Financial statements following the above-mentioned procedures; 

For accepted out-of-district returns and required attachments, the RCOs shall forward the documents to concerned Revenue District Offices. 

II. SUBMISSION THROUGH eAFS 

Any taxpayer, may submit the Filed ITR and its required attachments to the ITR on-line thru the eAFS system of the BIR. This may be accessed through the BIR webpage at www.bir.gov.ph by clicking the icon of the eAFS thereat. 

The required attachments will be grouped into three (3) document files' Taxpayers must scan the documents and save them into pDF fiies, named accordingly before uploading them into the eAFS:

The eAFS will acknowledge successful submission by issuing a system generated Transaction Reference Number and by sending an email to the system user. This Transaction Reference Number shall serve as the proof of submission by the taxpayer, in lieu of the manual "Received" stamping. Provided that the taxpayer shall keep the original copies of the digitally submitted documents in accordance with Section 203 of the NIRC for the period as prescribed under Revenue Regulations ll-2013. Provided further that the same shall be presented, upon request, to the BIR . For a detailed guideline on how to use the system, please refer to Annex 1 of this Circular. 

Reference: RMC 49-2020 https://www.bir.gov.ph/images/bir_files/internal_communications_1/Advisory/posted%20during%20quarantine%20march%202020/RMC%20No.%2049-2020.pdf

New Offline eBIRForms Package v7.6.1

The bureau recently issued New Offline eBIRForms Package v7.6.1 in line with ease of Filing and Payments of BIR Returns for the Year 2020.

To download the New Offline eBIRForms Package v7.6.1 click below:

http://ebirforms-ftp.bir.gov.ph/ebirforms_package_v7.6.1.zip

Additional Options in the Acceptance and Processing of the Filed 2019 Income Tax Returns and Its Required Attachments

To ease the Acceptance and Processing of the Filed 2019 Income Tax Returns and Its Required Attachments, Revenue Memorandum Circular (RMC) No. 49-2020 has issued by the bureau to provide options to taxpayers in the submission of the filed 2019 Income Tax Return and its required attachements as follows:

I. SUBMISSION THROUGH RCO 

Taxpayers may submit the required attachments to the Annual Income Tax Returns to the Revenue Collection Officer nearest to them, notwithstanding Revenue District Office jurisdiction. 

1. For income tax returns with payments made thru the online payment facility of the AAB, the RCOs/Cos shall: 

a. Stamp "Received" the returns; 

The attachments to the income tax returns shall be stamped only on the page of the Balance Sheet, the Income Statement and Audit Certificate, if applicable. The other pages of the financial statements and its attachments need not be stamped "Received". In case of corporations and other juridical persons at least 2 extra copies of the Audited Financial Statements for filing with the Securities and Exchange Commission (SEC) should be stamped "Received" pursuant to Revenue Memorandum Order (RMO) Nos. 6-2010 and 13-2011. 

b. Batch and forward these returns and their respective attachments to the concerned Document Processing Division of the Revenue Region. 

2. For income tax returns filed electronically, the RCOs/Cos shall accept and stamp "Received" only the copies of the Filing Reference Number generated from the eFpS/E-mail Ctnfirmation from the eBIR Forms System and the Financial statements following the above-mentioned procedures; 

For accepted out-of-district returns and required attachments, theRCOs shall forward the documents to concerned Revenue District Offices.

II. SUBMISSION THROUGH eAFS 

Any taxpayer, may submit the Filed ITR and its required attachments to the ITR on-line thru the eAFS system of the BIR. This may be accessed through the BIR webpage at www.bir.gov.ph by clicking the icon of the eAFS thereat.

The required attachments will be grouped into three (3) document files. Taxpayers must scan the documents and save them into pDF files, named accordingly before uploading them into the eAFS:  

The eAFS will acknowledge successful submission by issuing a system generated Transaction Reference Number and by sending an email to the system user. This Transaction Reference Number shall serve as the proof of submission by the taxpayer, in lieu of the manual "Received" stamping. Provided that the taxpayer shall keep the original copies of the digitally submitted documents in accordance with Section 203 of the NIRC for the period as prescribed under Revenue Regulations ll-2013. Provided further that the same shall be presented, upon request, to the BIR . For a detailed guideline on how to use the system, please refer to Annex 1 of this Circular.

Please refer: https://www.bir.gov.ph/images/bir_files/internal_communications_1/Advisory/posted%20while%20under%20quarantine%20march%202020/RMC%20No.%2049-2020.pdf of the full text RMC No. 49-2020.

Payment of Internal Revenue Taxes through the Mobile Application Facility of the PayMaya Philippines, Inc.

A circular the was issued under Revenue Memorandum Circular (RMC) No. 54-2020 dated February 04, 2020 that refers to the payment of Internal Revenue Taxes through the Mobile Application Facility of the PayMaya Philippines, Inc. 

All payments made through the said mobile application will be settled by PayMaya with the Development Bank of the Philippines (DBP), an Authorized Agent Bank of the BIR, for remittance to the Bureau of the Treasury.

Moreover, Taxpayers are required to file their corresponding tax returns using the electronic filing facilities of eBIRForms System and/or Electronic Filing and Payment System (eFPS).

To pay your taxes via PayMaya App, download the App in the Google Play Store or Apple App Store or Huawei AppGallery then, follow the steps indicated below:

1. Log in to your PayMaya account and click on the "Pay Bills" option.

2. Select "Bureau of Internal Revenue"

3. Enter all pertinent details for your tax payment: Taxpayer Identification Number (TIN), Branch Code, Amount to be paid, Revenue District Office (RDO) Code, Form Series, Form Type, Tax Type, Return Period and email address where you want to receive the receipt of your tax payment.

4. Review the details of the transaction before clicking "Pay" button.

5. Received payment confirmation via SMS and email.

For more information on how to avail of this tax payment facility and to access the frequently asked questions, visit the PayMaya website at www.PayMaya.com For other inquiries/concerns you may email support@paymaya.com or you may call PayMaya +632 8845-77-88.

Please refer: https://www.bir.gov.ph/images/bir_files/internal_communications_1/Advisory/posted%20while%20under%20quarantine%20march%202020/Revenue%20Memorandum%20Circular%20No.%2054-2020.pdf

Statement of Management's Responsibility for Annual Income Tax Return

The CIR has issued Revenue Regulations (RR) No. 3-2010 to provide the rationale and guidelines for the submission of the Statement of Management Responsibility that shall accompany the financial statements that shall be submitted with the annual income tax return.

The contents and format of Statement of Management's responsibility are as follows:

(A) Since that Annual Income Tax Return is primarily the responsibility of the management of the taxpayer, this shall be accompanied by a statement of management's responsibility.

(B) All taxpayers required to file annual income tax return under the National Internal Revenue Code, as amended, shall be required to submit a statement of management's responsibility, as follows:

"STATEMENT OF MANAGEMENT'S RESPONSIBILITY

FOR ANNUAL INCOME TAX RETURN

The Management of (name of taxpayers) is responsible for all information and representations contained in the Annual Income Tax Return for the year ended (date). Management is likewise responsible for all information and representations contained in the financial statements accompanying the (Annual Income Tax Return or Annual Information Return) covering the same reporting period. Furthermore, the Management is responsible for all information and representations contained in all other tax returns filed for the reporting period, including, but not limited to the value added tax and/or percentage tax returns, withholding tax returns, documentary stamp tax returns, and any and all other tax returns.

In this regards, the Management affirms that the attached audited financial statements for the year ended (date) and the accompanying Annual Income Tax Return are in accordance with the books and records of (name of taxpayer), complete and correct in all material respects. Management likewise affirms that:

(a) the Annual Income Tax Return has been prepared in accordance with the provisions of the National Internal Revenue Code, as amended, and pertinent tax regulations and other issuances of the Department of Finance and the Bureau of Internal Revenue;

(b) any disparity of figures in the submitted reports arising from the preparation of financial statements pursuant to financial accounting standards and the preparation of the income tax return pursuant to tax accounting rules has been reported as reconciling items and maintained in the company's books and records in accordance with the requirements of Revenue Regulations No. 8-2007 and other relevant issuances;

(c) the (name of taxpayer) has filed all applicable tax returns, reports and statements required to be filed under Philippine tax laws for the reporting period, and all taxes and other impositions shown thereon to be due and payable have been paid for the reporting, except those contested in good faith.

Signature: ____________________________

(Name of the Individual Taxpayer/President/Managing Partner

Signature: ____________________________

(Name of the Chief Executive Officer or its equivalent)

Signature: ____________________________

(Name of the Chief Financial Officer or its equivalent)"

(C) Aside from Individual Taxpayers, President and Managing Partner, the Chief Executive Officer and the Chief Financial Officer or any officer performing similar functions regardless of their designation are also required to affix their signatories in the afore-mentioned Statement.

(D) In the case of a foreign corporation with branch office in the Philippines, the above Statement shall be signed by its local manager who is in charge of its operations.

Please refer https://www.bir.gov.ph/images/bir_files/old_files/pdf/49436RR%203-2010.pdf of the full text of RR No. 3-2010.

Guidelines in the Filing of the 2019 Income Tax Returns and Submission of Required Attachments

On March 17, 2020, the CIR has approved the Revenue Memorandum Circular (RMC) No. 25-2020 related to the guidelines in the filing and receiving of the 2019 Income Tax Returns.

Taxpayers who are enrolled in EFPS shall continue to settle the tax liabilities with the Authorized Agent Bank (AAB) where the taxpayer is enrolled, while for those who shall file their AITR through EBIRForm Facility, the following are the payment options:

1. Over-theCounter (OTC) payment through Authorized Agent Banks (AABs);

2. Revenue Collection Officers (RCOs) in areas where there is no AABs;

3. Electronic/Online payment:

a) Landbank of the Philippine's (LBP) Link.Ziz Portal (for taxpayers who have ATM account with LBP and/or for holders of Bancnet ATM/Debit/Prepaid Card and taxpayer utilizing PesoNet facility (depositor of RCBC & Robinsons Bank), refer to Annex "A"

b) Development of the Philippines' (DBP) Pay Tax Online (for holders of Visa/Mastercard Credit Card and/or Bancnet ATM/Debit Card), refer to Annex "B"

c) Union Bank Online Web and Mobile Payment Facility (for taxpayer who has an account with Union Bank of the Philippines), refer to Annex "C"

d) Mobile Payment (GCash/Paymaya), refer to Annex "D"

The filing of tax returns manually can still be done by those who are not mandated to file and pay electronically, if the AITRto be filed has tax due and payable. If there is no tax to be paid, the same are required to be filed through eBIRForm facilities.

Considering the limitations in the preparation of the AITR to be filed by concerned taxpayers due to the aforesaid lock-down, errors in the determination of their income taxes are possible. Hence, taxpayers, at any time, can amend their AITR filed, provided the concerned taxable period has not been the subject yet of an audit. An amendment that will result to additional income tax to be paid, can still be paid without the imposition of corresponding penalties if the same shall be done not later than June 15, 2020. Moreover, required attachments to the electronically filed AITR can be submitted to the Revenue District Office where the taxpayers is registered until June 15, 2020.

Please refer: https://www.bir.gov.ph/images/bir_files/internal_communications_2/RMCs/2020%20RMCs/RMC%20No.%2025-2020_copy.pdf of the full text of RMC No. 25-2020.

Manner of Accepting Payment of Internal Revenue Taxes until June 14, 2020

The CIR has approved Revenue Memorandum Circular (RMC) No. 48-2020 dated May 22, 2020 related to the Manner of Accepting Payment of Internal Revenue Taxes until June 14, 2020.

It is stated in the Circular that will extend until June 14, 2020 the leniency in filing of returns and payment of taxes due as provided under RMC No. 43-2020 and to include payment of payment of Amnesty Tax. Hence, until June 14, 2020, concerned taxpayers may:

1. File the tax return and pay the internal revenue taxes at the nearest Authorized Agent Banks (AABs), notwithstanding RDO jurisdiction;

2. File the tax return and pay the corresponding tax due thereon to the concerned Revenue Collection Officers (RDOs) of the nearest Revenue District Office (RD), even in areas where there are AABs.

The Circular also mentioned, provided that payment of internal revenue taxes in cash should not exceed Twenty Thousand Pesos (P20,000.00), while those for check payment will have no limitation if the same is made with RDO in the district office until June 14, 2020. Provided further that all checks shall be made payable to Bureau of Internal Revenue (with or without "IFO Name and TIN of the taxpayer" written on the check as previously required) and that the name and branch of the receiving AAB may no longer be indicated therein.

Please refer: https://www.bir.gov.ph/images/bir_files/internal_communications_1/Advisory/posted%20while%20under%20quarantine%20march%202020/RMC%20No.%2048-2020.pdf RMC No. 48-2020 of the full text of RMC No. 48-2020.

Meaning of "Business Style" Being Required in the Official Receipts and Invoices

On May 21, 2019, the bureau published Revenue Memorandum Circular (RMC) No. 55-2019 that clarifies the meaning of "Business Style" Being Required in the Official Receipts and Invoices which is required to be indicated on the official receipts and invoices pursuant to Section 113(B) of the National International Revenue Code (NIRC), as amended; Section II(J) of Revenue Memorandum (RMO) No. 12-2013; Section 5 of Revenue Regulations (RR) No. 10-2015, as amended by RR No. 16-2018; and RMC No. 64-2015.

In the RMC, it is stated that the phrase "Business Style" refers to the business name registered with the concerned regulatory body used by the taxpayer other than its registered name or company name. For examples:

1) A corporation is registered under the corporate name of XYZ Entertainment Corporation. Based on its Certificate of Registration issued by Securities and Exchange Commission (SEC), the Corporation is operating under the business name of "Bozo the Clown." In this case, the business style is the business name which is "Bozo the Clown."

2) A single proprietor named Juanita M. Ricafrente registered a business name with the Department of Trade and Industry (DTI). Reflected in her DTI Certificate of Registration is the business name of "JMR Trading." Hence, the business style is 'JMR Trading."

Please refer: https://www.bir.gov.ph/images/bir_files/internal_communications_2/RMC%20No%2055-2019.pdf RMC No. 55-2019.