Revenue Regulations (RRs)
RR NO. 10-2018, issued on March 8, 2018 pursuant to RA No. 10021 (“Exchange of Information on Tax Matters Act of 2009”), amends Sec. 10 of RR No. 10-2010, titled “Exchange of Information Regulations”. A taxpayer shall be duly notified in writing by the Commissioner that a foreign tax authority is requesting for exchange of information held by financial institutions pursuant to an international convention or agreement on tax matters within 60 days following his transmittal of all the information requested from, and provided for by, the concerned financial institution to the requesting treaty partner. [Digest]
RR NO. 11-2018, issued on March 15, 2018, amends certain provisions of RR No. 2-1998, as amended, to implement further amendments introduced by RA No. 10963 (TRAIN Law), relative to withholding of Income Tax. The areas of amendments are as follows: (1) Expanded coverage of income payments subject to final & creditable withholding tax& increasing the tax rates; (2) Expanded coverage on the subject taxpayers not required to be deducted & withheldfrom their receipt of income; (3) Amendment on the manner, venue, and time of filing of withholding tax returns& payment of taxes withheld at source including the alphabetical list of payees; (4) Expanded coverage of de minimis benefits, compensation income not subject to withholding tax; (5) Revision of BIR Forms 1902 & 1905 or Application for Registration of Purely & Information Update for Compensation Income Earner as well as procedures for the filing & related consequences for failure to comply; (6) Revision of BIR Form 2316 or the Employees Withholding Tax Statements including the procedures & guidelines for filing; and (7) Transitory provision applicable to taxpayers availing exemption from withholding. [Digest]
RR NO. 12-2018, issued on March 15, 2018, consolidates the rules governing the imposition and payment of the Estate and Donor’s Tax incorporating the provisions of the TRAIN Law, particularly the provisions in Chapters I and II of Title III of the NIRC, thereby repealing RR No. 2-2003, as amended. The net estate of every decedent shall be subject to an estate tax at the rate of 6%, while the donor’s tax shall be 6% computed on the basis of the total gifts in excess of P250,000 exempt gift made during the calendar year. [Digest]
RR NO. 13-2018, issued on March 15, 2018, prescribes the regulations implementing the VAT and Percentage Tax provisions under RA No. 10963 (TRAIN Law), further amending RR No. 16-2005 (Consolidated VAT Regulations of 2005), as amended. Export sales, sales to persons or entities whose exemption under special laws or international agreements to which the Philippines is a signatory, and certain services performed in the Philippines by a VAT-registered person shall be subject to 0% VAT rate. Transactions such as services subject to Percentage Tax under Title V of the Tax Code shall be exempt from VAT. [Digest]
Revenue Memorandum Orders (RMOs)
RMO NO. 14-2018, issued on March 9, 2018, creates the Alphanumeric Tax Code (ATC) for the remittance of Creditable and Final Income Taxes withheld under RA No. 10963 (TRAIN Law). Subcategories under Final Income Taxes Withheld include: (a) Interest Paid on Deposits and Yield on Deposit Substitutes/Trusts/Etc.; and (b) Other Final Income Taxes. [Digest]
RMO NO. 15-2018, issued on March 14, 2018, prescribes the policies, guidelines and procedures on the implementation of the post evaluation of the Cash Register Machines (CRM), Point-of-Sale (POS) machines and other Sales Receipting System Software, including the extraction of data from Electronic Sales (eSales) Journal and Z-Reading. Each machine being used for business operations must be registered with the BIR and must have a Permit to Use (PTU) that must conspicuously attached thereto. [Digest]
Revenue Memorandum Circulars (RMCs)
RMC NO. 13-2018, issued on March 1, 2018, clarifies certain provisions of RAO No. 5-2017 relative to the approval and/or signing of Certificates of Zonal Values of Real Properties. The authority to approve and/or sign Certificates of Zonal Values of Real Properties shall rest with the Assistant Revenue District Officer, and not with the Revenue District Officer. [Digest]
RMC NO. 17-2018, issued on March 8, 2018, amends certain provisions of RMC Nos. 89-2017 and 54-2014 on the processing of claims for issuance of tax refund/tax credit certificate (TCC), in relation to amendments made in the NIRC of 1997, as amended by RA No. 10963 (TRAIN Law). TVN’s shall be manually issued until such time that the Tax Verification Notice Monitoring System is fully operational. The time frame to grant claims for VAT refund is 90 days from the date of submission of the official receipts or invoices and other documents in support of the application. [Digest] [Annex A.1] [Annex A.1.1] [Annex A.1.2-A.1.12] [Annex A.2] [Annex B] [Annex C] [Annex D] [Annex E] [Annex F]
RMC NO. 18-2018, issued on March 9, 2018, circularizes Department Order No. 11-2018 issued by the Department of Finance, which states that the authority to accredit and register customs brokers and importers is reverted solely to the Bureau of Customs (BOC) for purposes of simplification of process. The BOC is, however, mandated to transmit to the BIR on a quarterly basis the list of approved/accredited customs brokers and importers for post-accreditation validation of tax compliance. [Digest]
RMC NO. 19-2018, issued on March 19, 2018, clarifies the basis for the computation of Capital Gains Tax (CGT) and Documentary Stamp Tax (DST) in sales transactions of real property previously mortgaged at a value higher than its zonal or fair market value. Pursuant to Sec. 24(D)(1) and Sec. 196 in relation to Sec 6(E) of the Tax Code, as amended, the only basis for the computation of the CGT and DST are: (1) gross selling price or the consideration contracted to be paid for such realty; and (2) Fair Market Value determined by the Commissioner in accordance with Sec. 6(E) of the Tax Code. Thus, Revenue District Officers cannot veer away from the provisions of the law and consider the mortgage value of a property previously set. [Digest]