BIR issues new tax rules

INDIVIDUALS employed by foreign governments, embassies, diplomatic missions, or international organizations in the country are not exempted from income taxes, the Bureau of Internal Revenue (BIR) said.

Revenue Regulations (RR) 7-2013, dated April 29 and published yesterday, provides guidelines for the abatement of applicable surcharges, interest, and compromise penalties for the filing of tax returns.

Earlier in April, the BIR issued Revenue Memorandum Circular (RMC) 31-2013, which clarified the liabilities of Filipino and alien employees employed by foreign governments, embassies, diplomatic missions and international organizations in the Philippines. The April 12 circular specified the types of individuals to be granted tax perks.

Those not granted such exemptions must file their income tax returns (ITRs) and pay the tax due thereon on or before the 15th day of April following the close of the taxable year.

"Upon the issuance of RMC 31-2013, the BIR has received numerous requests from embassies and international organizations for the abatement of surcharges, interests, and compromise penalties which will be imposed on the taxes due from their employees who have yet to file their 2012 tax returns and those who ought to amend their tax returns to cover tax deficiencies," RR 7-2013 notes.

"In the exercise of the power of the Commissioner of Internal Revenue to abate the payment of tax liabilities ... these regulations are being issued...," it adds.

The regulations state that the employers of the concerned individuals must submit to the BIR, before May 10, a summary list of their employees as of December 31, 2012. Only those individuals that appear in the lists may avail of the abatement of late charges.

Employees who failed to file their ITRs for the 2012 taxable year, or did not declare the correct amount of income, may file their ITRs or amend these and pay the taxes due thereon on or before May 15.

"No surcharges and interests ... shall be imposed. Further, no compromise penalty ... shall be assessed upon filing thereof," the RR states.

To qualify for the abatement, however, the individuals must be registered with the BIR, must have not been issued any tax discrepancy notices in 2012, and were not the subject of any criminal case for any offenses under the Tax Code last year.

source:  Businessworld