SUBJECT : Guidelines in the Implementation of Revenue Regulations (RR) Nos. 13-2001 and 15 -2006 for Taxpayers Under The Jurisdiction of the Large Taxpayers Service _____________________________________________________________________
This Circular is issued to clarify the procedures to be adopted in processing, evaluating and approving applications for abatement and cancellation of penalties/surcharges and interest on delinquent accounts and assessments (preliminary or final, disputed or not) of taxpayers under the jurisdiction of Large Taxpayers Service (LTS).
In as much as the LTS has a separate division for its collection and enforcement activities, i.e. the Large Taxpayers-Collection and Enforcement Division (LTCED), and in order to shorten the review process of applications for abatement of taxpayers which are under the jurisdiction of LTS, and thereby expedite the processing thereof, it is hereby mandated that:
(1) all applications for abatement under RR No. 13-2001 of taxpayers under the jurisdiction of LTS shall henceforth be processed and evaluated by the LTS sub-Technical Working Committee (LTS sub - TWC) created under Revenue Special Order (RSO) No. 374-2006 dated July 27, 2006, without the need of indorsing them further to the Technical Working Committee (TWC) on Abatement for evaluation. The LTS sub-TWC shall be the one in-charge of coming up with final recommendations for approval/disapproval of applications for abatement of said taxpayers of LTS, for submission to the Commissioner of Internal Revenue; and (2) all applications for abatement filed pursuant to RR No. 15-2006 (“One-Time Administrative Abatement Program”) by taxpayers under the jurisdiction of LTS shall, unless they are otherwise pending with other divisions of the Bureau of Internal Revenue such as the Litigation, Prosecution or Appellate Divisions or other concerned offices in which case said divisions are in-charge of processing the applications, be initially processed by the concerned division/s of the LTS and elevated to the LTS sub-TWC for final evaluation and recommendation, before dockets are transmitted directly to the Office of the Commissioner (OCIR) for approval/disapproval of the Commissioner of Internal Revenue.
REPUBLIC OF THE PHILIPPINES
DEPARTMENT OF FINANCE
BUREAU OF INTERNAL REVENUE
Quezon City
All pending applications for abatement pursuant to RR Nos. 13-2001 and 15-2006 of taxpayers under the jurisdiction of the LTS upon the issuance of this Circular shall be processed in accordance herewith. The LTS sub-TWC is, however, required to submit every 5th day of the following month, list/s of applications for abatement processed by the LTS with pertinent details of evaluation/action taken to the Collection Service for monitoring of the results and effectiveness of the Abatement Program. Any provision of existing issuance/s which may be inconsistent with the foregoing is hereby deemed superseded/amended accordingly. All concerned are hereby enjoined to comply with the foregoing, and give this Circular as wide a publicity as possible.
(Original Signed)
JOSE MARIO C. BUÑAG
Commissioner
REVENUE MEMORANDUM CIRCULAR NO. 3-2007
SUBJECT: Publishing the Full text of Memorandum Order No. 233 dated December 11, 2006 issued by the President Gloria Macapagal-Arroyo Directing the Land Registration Authority, through the concerned Register of Deeds, to Annotate in the Transfer Certificate of Title the Serial Number of the Certificate Authorizing Registration issued by the Bureau of Internal Revenue, and Other Pertinent Details
TO : All Internal Revenue Officials, Employees and Others Concerned
For the information and guidance of all internal revenue officers, employees and others concerned, quoted hereunder is the full text of Memorandum Order No. 233 issued by the President of the Philippines, directing the Land Registration Authority, through the concerned Register of Deeds, to annotate in the Transfer Certificate of Title the Serial Number of the Certificate Authorizing Registration issued by the Bureau of Internal Revenue, and other pertinent details as follows:
“MEMORANDUM ORDER NO. 233
DIRECTING THE LAND REGISTRATION AUTHORITY, THROUGH THE CONCERNED REGISTER OF DEEDS, TO ANNOTATE IN THE TRANSFER CERTIFICATE OF TITLE THE SERIAL NUMBER OF THE CERTIFICATE AUTHORIZING REGISTRATION ISSUED BY THE BUREAU OF INTERNAL REVENUE
WHEREAS, tax collection is always among the top priority measures of the State;
WHEREAS, tax collection in the transfer of real property, due to brisk turnover, is an important source of funding for the government;
WHEREAS, prior to registering any deed and acquiring a Transfer Certificate of Title, the Tax Reform Act of 1997 requires the payment of transfer taxes with the Bureau of Internal Revenue and tax clearance is manifested by a Certificate Authorizing Registration with a unique serial number;
WHEREAS, Presidential Decree No. 1529, or the “Property Registration Decree”, provides that registered land shall be subject to such burdens and incidents as may arise by operation of law, such as payment of transfer taxes under the Tax Reform Act of 1997;
WHEREAS, Presidential Decree No. 1529 recognizes that such other burdens and incidents may be annotated in the Transfer Certificate of Title;
WHEREAS, requiring such annotation allows a system of verifying tax payme nts and, thus, ensure transfer tax payments by the taxpayer;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do order:
Section 1. Additional Annotation Requirement. The Land Registration Authority, through the concerned Register of Deeds, is hereby directed to annotate in the Transfer Certificates of the Title the serial number of the Certificate Authorizing Registration (CAR) issued by the BIR, the date of its issuance, the Revenue District Office Number of the district office that issued the CAR, the name of the Revenue District Officer who signed the CAR and the taxes paid. This shall be an indispensable requirement prior to the issuance of a Transfer Certificate of Title by the Register of Deeds.
Section 2. Objectives. This additional annotation requirement shall allow the verification and back-checking of tax payments and shall ensure that transfer tax payments are paid as a precondition to issuance of title.
Section 3 Scope. The additional annotation requirement shall cover transfers of Original, Condominium, and Transfer Certificates of Title of real properties sought to be registered with the Register of Deeds.
Section 4. Repealing Clause. All executive issuance, rules and regulations or parts thereof, which are inconsistent with this Memorandum Order, are hereby repealed or modified accordingly.
Section 5. Effectivity. This Memorandum Order shall take effect fifteen (15) days after its publication in a national newspaper of general circulation.
Done in the City of Manila, this 11th day of December in the year of Our Lord, two thousand and six.
(Signature of President Gloria Macapagal-
Arroyo affixed in the Original)
By the President:
(Original Signed)
EDUARDO R. ERMITA
Executive Secretary”
All revenue officials and employees are enjoined to give this Circular as wide publicity as possible.
(Original Signed)
JOSE MARIO C. BUÑAG
Commissioner of Internal Revenue
TO : All Internal Revenue Officials, Employees and Others Concerned
For the information and guidance of all internal revenue officers, employees and others concerned, quoted hereunder is the full text of Memorandum Order No. 233 issued by the President of the Philippines, directing the Land Registration Authority, through the concerned Register of Deeds, to annotate in the Transfer Certificate of Title the Serial Number of the Certificate Authorizing Registration issued by the Bureau of Internal Revenue, and other pertinent details as follows:
“MEMORANDUM ORDER NO. 233
DIRECTING THE LAND REGISTRATION AUTHORITY, THROUGH THE CONCERNED REGISTER OF DEEDS, TO ANNOTATE IN THE TRANSFER CERTIFICATE OF TITLE THE SERIAL NUMBER OF THE CERTIFICATE AUTHORIZING REGISTRATION ISSUED BY THE BUREAU OF INTERNAL REVENUE
WHEREAS, tax collection is always among the top priority measures of the State;
WHEREAS, tax collection in the transfer of real property, due to brisk turnover, is an important source of funding for the government;
WHEREAS, prior to registering any deed and acquiring a Transfer Certificate of Title, the Tax Reform Act of 1997 requires the payment of transfer taxes with the Bureau of Internal Revenue and tax clearance is manifested by a Certificate Authorizing Registration with a unique serial number;
WHEREAS, Presidential Decree No. 1529, or the “Property Registration Decree”, provides that registered land shall be subject to such burdens and incidents as may arise by operation of law, such as payment of transfer taxes under the Tax Reform Act of 1997;
WHEREAS, Presidential Decree No. 1529 recognizes that such other burdens and incidents may be annotated in the Transfer Certificate of Title;
WHEREAS, requiring such annotation allows a system of verifying tax payme nts and, thus, ensure transfer tax payments by the taxpayer;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do order:
Section 1. Additional Annotation Requirement. The Land Registration Authority, through the concerned Register of Deeds, is hereby directed to annotate in the Transfer Certificates of the Title the serial number of the Certificate Authorizing Registration (CAR) issued by the BIR, the date of its issuance, the Revenue District Office Number of the district office that issued the CAR, the name of the Revenue District Officer who signed the CAR and the taxes paid. This shall be an indispensable requirement prior to the issuance of a Transfer Certificate of Title by the Register of Deeds.
Section 2. Objectives. This additional annotation requirement shall allow the verification and back-checking of tax payments and shall ensure that transfer tax payments are paid as a precondition to issuance of title.
Section 3 Scope. The additional annotation requirement shall cover transfers of Original, Condominium, and Transfer Certificates of Title of real properties sought to be registered with the Register of Deeds.
Section 4. Repealing Clause. All executive issuance, rules and regulations or parts thereof, which are inconsistent with this Memorandum Order, are hereby repealed or modified accordingly.
Section 5. Effectivity. This Memorandum Order shall take effect fifteen (15) days after its publication in a national newspaper of general circulation.
Done in the City of Manila, this 11th day of December in the year of Our Lord, two thousand and six.
(Signature of President Gloria Macapagal-
Arroyo affixed in the Original)
By the President:
(Original Signed)
EDUARDO R. ERMITA
Executive Secretary”
All revenue officials and employees are enjoined to give this Circular as wide publicity as possible.
(Original Signed)
JOSE MARIO C. BUÑAG
Commissioner of Internal Revenue
REVENUE REGULATIONS NO. 1 - 2007
SUBJECT: Amending Revenue Regulations No. 4-2006 Implementing the Tax
Privileges Provisions of R.A. No. 9257, Otherwise Known as the “Expanded Senior Citizens Act of 2003”
TO: All Internal Revenue Officers and Others Concerned
SECTION 1. Scope. – Pursuant to Section 244 of the Tax Code of 1997, as amended, in relation to Section 2 of R.A. No. 9257, otherwise known as the “Expanded Senior Citizens Act of 2003,” and its Implementing Rules and Regulations promulgated by the Department of Social Welfare & Development, these Regulations are hereby promulgated to amend Section 8(5) of RR 4-2006 deleting the TIN requirement under the said Section, and to add a provision clarifying the basis of computation of the VAT on the sale of goods and services to senior citizens who have been granted sales discounts.
SEC. 2. Deleting the TIN Requirement Under Section 8(5) of RR 4-2006. – Section 8(5) of RR 4-2006 is hereby amended deleting the TIN requirement as one of the conditions in order that establishments may claim the sales discounts as deductions from gross income, and further giving the senior citizens a hassle-free privilege to enjoy the purchase discount, which Section shall read as follows:
“Sec. 8. Availment by Establishments of Sales Discounts as Deduction from Gross Income. –
x x x x x x x x x x x x
“(5) The business establishment giving sales discounts to qualified senior citizens is required to keep separate and accurate record of sales, which shall include the name of the senior citizen, OSCA ID, gross sales/receipts, sales discount granted, date of transaction and invoice number for every sale transaction to senior citizen.
x x x x x x x x x
SEC. 3. A new Section is hereby added to RR 4-2006 as Section 10 thereof clarifying the basis of computation of the value-added tax on the sale to senior citizens with sales discounts by the subject establishments to read as follows:
+
“Sec. 10. Basis of Computation of Value-Added Tax on Sale to Senior Citizens. – VAT on sales of goods or services with sales discounts granted by establishments enumerated under Section 8 hereof shall be computed in accordance with the following illustration:
Amount of sale (without the VAT) P100.00
Less: 20% sales discount 20.00
Vatable sale P 80.00
Plus: 12% VAT (based on P80) 9.60
Total amount to be paid by the senior citizen P89.60
SEC. 4. Renumbered Sections. – Original Sections 10 and 11 of RR 4-2006 shall be renumbered as Sections 11 and 12 thereof, respectively.
SEC. 5. Amendatory Clause. – Provisions of existing issuances which are or may be inconsistent with the foregoing, if any, are hereby deemed amended and/or superseded accordingly.
SEC. 6. Effectivity Clause. – These Regulations shall take effect fifteen (15) days after publication in the Official Gazette or newspaper of general circulation, whichever comes first. These Regulations shall in no case be given retroactive effect such that no refund can be claimed for any previous transactions using different basis of computation from that reflected in Section 10 above.
(Original Signed)
MARGARITO B. TEVES
Secretary of Finance
Recommended by:
(Original Signed)
JOSE MARIO C. BUÑAG
Commissioner of Internal Revenue
Privileges Provisions of R.A. No. 9257, Otherwise Known as the “Expanded Senior Citizens Act of 2003”
TO: All Internal Revenue Officers and Others Concerned
SECTION 1. Scope. – Pursuant to Section 244 of the Tax Code of 1997, as amended, in relation to Section 2 of R.A. No. 9257, otherwise known as the “Expanded Senior Citizens Act of 2003,” and its Implementing Rules and Regulations promulgated by the Department of Social Welfare & Development, these Regulations are hereby promulgated to amend Section 8(5) of RR 4-2006 deleting the TIN requirement under the said Section, and to add a provision clarifying the basis of computation of the VAT on the sale of goods and services to senior citizens who have been granted sales discounts.
SEC. 2. Deleting the TIN Requirement Under Section 8(5) of RR 4-2006. – Section 8(5) of RR 4-2006 is hereby amended deleting the TIN requirement as one of the conditions in order that establishments may claim the sales discounts as deductions from gross income, and further giving the senior citizens a hassle-free privilege to enjoy the purchase discount, which Section shall read as follows:
“Sec. 8. Availment by Establishments of Sales Discounts as Deduction from Gross Income. –
x x x x x x x x x x x x
“(5) The business establishment giving sales discounts to qualified senior citizens is required to keep separate and accurate record of sales, which shall include the name of the senior citizen, OSCA ID, gross sales/receipts, sales discount granted, date of transaction and invoice number for every sale transaction to senior citizen.
x x x x x x x x x
SEC. 3. A new Section is hereby added to RR 4-2006 as Section 10 thereof clarifying the basis of computation of the value-added tax on the sale to senior citizens with sales discounts by the subject establishments to read as follows:
+
“Sec. 10. Basis of Computation of Value-Added Tax on Sale to Senior Citizens. – VAT on sales of goods or services with sales discounts granted by establishments enumerated under Section 8 hereof shall be computed in accordance with the following illustration:
Amount of sale (without the VAT) P100.00
Less: 20% sales discount 20.00
Vatable sale P 80.00
Plus: 12% VAT (based on P80) 9.60
Total amount to be paid by the senior citizen P89.60
SEC. 4. Renumbered Sections. – Original Sections 10 and 11 of RR 4-2006 shall be renumbered as Sections 11 and 12 thereof, respectively.
SEC. 5. Amendatory Clause. – Provisions of existing issuances which are or may be inconsistent with the foregoing, if any, are hereby deemed amended and/or superseded accordingly.
SEC. 6. Effectivity Clause. – These Regulations shall take effect fifteen (15) days after publication in the Official Gazette or newspaper of general circulation, whichever comes first. These Regulations shall in no case be given retroactive effect such that no refund can be claimed for any previous transactions using different basis of computation from that reflected in Section 10 above.
(Original Signed)
MARGARITO B. TEVES
Secretary of Finance
Recommended by:
(Original Signed)
JOSE MARIO C. BUÑAG
Commissioner of Internal Revenue
REVENUE REGULATIONS NO. 2-2007
SUBJECT : Amending Certain Provisions of Revenue Regulations No. 16-2005, Otherwise Known as the Consolidated Value-Added Tax Regulations of 2005.
TO : All Internal Revenue Officers and Others Concerned.
Section 1. SCOPE. - Pursuant to the provisions of Sec. 244 and 245 of the National Internal Revenue Code of 1997, as amended, in relation to Title IV of the same Tax Code, as last amended by Republic Act (RA) No. 9361, these Regulations are hereby promulgated to amend certain provisions of Revenue Regulations (RR) No. 16-2005, otherwise known as the Consolidated Value-Added Tax Regulations of 2005.
Section 2. VAT PAYABLE. - Sec. 4.110-7 of RR No. 16-2005 is hereby amended to read as follows:
“SEC. 4.110-7. VAT Payable (Excess Output) or Excess Input Tax.
Xxx xxx xxx.
(b) If the input tax inclusive of input tax carried over from the previous quarter exceeds the output tax, the excess input tax shall be carried over to the succeeding quarter or quarters; Provided, however, that any input tax attributable to zero-rated sales by a VAT-registered person may at his option be refunded or applied for a tax credit certificate which may be used in the payment of internal revenue taxes, subject to the limitations as may be provided for by law, as well as, other implementing rules.”
Section 3. EFFECTIVITY. - These Regulations shall take effect immediately and shall apply to the quarterly VAT returns to be filed after the effectivity of RA No. 9361 except VAT returns covering taxable quarters ending earlier than December, 2006.
(Original Signed)
MARGARITO B. TEVES
Secretary
Department of Finance
Recommending Approval:
(Original Signed)
JOSE MARIO C. BUÑAG
Commissioner of Internal Revenue
TO : All Internal Revenue Officers and Others Concerned.
Section 1. SCOPE. - Pursuant to the provisions of Sec. 244 and 245 of the National Internal Revenue Code of 1997, as amended, in relation to Title IV of the same Tax Code, as last amended by Republic Act (RA) No. 9361, these Regulations are hereby promulgated to amend certain provisions of Revenue Regulations (RR) No. 16-2005, otherwise known as the Consolidated Value-Added Tax Regulations of 2005.
Section 2. VAT PAYABLE. - Sec. 4.110-7 of RR No. 16-2005 is hereby amended to read as follows:
“SEC. 4.110-7. VAT Payable (Excess Output) or Excess Input Tax.
Xxx xxx xxx.
(b) If the input tax inclusive of input tax carried over from the previous quarter exceeds the output tax, the excess input tax shall be carried over to the succeeding quarter or quarters; Provided, however, that any input tax attributable to zero-rated sales by a VAT-registered person may at his option be refunded or applied for a tax credit certificate which may be used in the payment of internal revenue taxes, subject to the limitations as may be provided for by law, as well as, other implementing rules.”
Section 3. EFFECTIVITY. - These Regulations shall take effect immediately and shall apply to the quarterly VAT returns to be filed after the effectivity of RA No. 9361 except VAT returns covering taxable quarters ending earlier than December, 2006.
(Original Signed)
MARGARITO B. TEVES
Secretary
Department of Finance
Recommending Approval:
(Original Signed)
JOSE MARIO C. BUÑAG
Commissioner of Internal Revenue
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