BIR Revenue Memorandum Circular No. 143-2019

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BIR Revenue Memorandum Circular No. 143-2019

Clarification on Inclusion of Taxpayers as Top Withholding Agents Who are Obliged to Remit the 1% and 2% Creditable Withholding Taxes Pursuant to the Criteria of Revenue Regulations No. 7-2019

REVENUE MEMORANDUM CIRCULAR NO. 143-2019 issued on December 27, 2019 clarifies the inclusion of taxpayers as Top Withholding Agents who are obliged to remit the 1% and 2% Creditable Withholding Taxes (CWTs) pursuant to the criteria of Revenue Regulations (RR) No. 7-2019
In implementing RR No. 7-2019 and consistent to the policy of Ease of Doing Business by ensuring that the list of Top Withholding Agents (TWAs) only reflect taxpayers who are compliant to the prescribed criteria of said RR, Operations Memorandum (OM) Order No. 20-2019 was issued, which excludes the following taxpayers in the identification of TWAs, although they have satisfied the prescribed criteria of the said RR:
a. National government agencies, government-owned or controlled corporations, state universities and colleges. and local government units;
b. Taxpayers who were included because of one-time transactions (i.e. Estate and Donor’s Tax);
c. Individual taxpayers deriving income on commission basis such as but not limited to insurance agent and real estate broker, subject to verification of their duly-filed 2018 Quarterly Income Tax Returns (BIR Form No. 1701Q) in order to determine the regularity of their transactions. Accordingly, if the ?12M criteria has been satisfied only in one (1) taxable quarter, the taxpayer shall not be qualified as TWA; and
d. Taxpayers who are tax exempt from payment of Income Taxes with no proprietary activities (i.e. foundations, non-stock, non-profit and tax exempt educational institutions, religious and charitable institutions, etc.).
On the basis of the above discussions and clarifications, in cases of publication of TWAs in the newspaper of general circulation wherein certain taxpayers are included or not deleted in the existing list of TWAs but do not satisfy the criteria of RR No. 7-2019, or if they may have satisfied the same but qualify as taxpayers enumerated in OM No. 20-2019 who should be excluded from the list of TWAs, these taxpayers cannot be compelled to withhold the 1% and 2% CWTs.

BIR Revenue Memorandum Circular No. 142-2019

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BIR Revenue Memorandum Circular No. 142-2019

Circularizing the eDST System’s Balance Adjustment as an Option for Recovery of Erroneously Deducted DST

REVENUE MEMORANDUM CIRCULAR NO. 142-2019 issued on December 27, 2019 circularizes the Electronic Documentary Stamp Tax (eDST) System’s balance adjustment as an option for recovery of erroneously deducted DST.
Aside from filing a claim for refund, a request for adjustment to the taxpayer’s ledger balance in the eDST System may be filed by the concerned taxpayer, provided that the following conditions are satisfied:
a. The revised BIR Form No. 2000 filed with the BIR is properly accomplished, more particularly on the tax computations for the eDST System (i.e., Part Il. A. and Schedule l); and
b. The erroneously deducted amount from the taxpayer’s ledger account in the eDST System has not been declared in Schedule I of the said return.
The request for adjustment in the taxpayer’s ledger balance shall be filed in writing by the taxpayer-user to the Chief, Miscellaneous Operations Monitoring Division (MOMD), Collection Service located in the National Office of the BIR, together with all the relevant documentary proofs on the incident(s) that gave rise to the erroneous deductions from the taxpayer’s ledger balance in the eDST System, including the taxable document where the eDST was affixed. These documents shall include a sworn declaration that the amount of DST requested for balance adjustment has not been applied to other taxable documents/transactions nor was it claimed as a deductible expense from the taxable income in the taxpayer’s Income Tax Return.
The recommendation, whether for approval or denial of the taxpayer’s request for adjustment, shall be evaluated by MOMD and subsequently endorsed to the Assistant Commissioner, Collection Service for final approval. In case of approval, the Chief, MOMD shall approve the taxpayer’s request and briefly indicate the reasons for adjustment in the box provided for, both under the “Balance Adjustment Details” functionality of the eDST System.
The taxpayer-user shall be notified, in writing or thru email, on the approval or denial of its request for balance adjustment within five (5) working days from receipt of the written recommendation and supporting documents of the concerned Revenue District Office or Large Taxpayer Service Division. The reason(s) for the denial of the taxpayer’s request shall, at all times, be clearly stated in the notice to the taxpayer. Should it be determined that a request for refund should have been filed instead by the taxpayer-user, the same should be categorically stated in the notice of denial. In case the taxpayer’s request does not arise from a system error and there is a need for a further verification at the taxpayer’s side, the same shall be communicated to the taxpayer.