THE BUREAU of Internal Revenue (BIR) will
cooperate with foreign governments, embassies, diplomatic missions, and
international organizations in the country to help their local employees
comply with the provisions of a recently issued circular noting that
they are not exempt from taxes.
"We can make arrangements to help your
employees register with the BIR and file their returns," Internal
Revenue Commissioner Kim S. Jacinto-Henares told a meeting of the
Consular Corps of the Philippines yesterday.
Ms. Jacinto-Henares was the keynote speaker at the event attended by
representatives of various foreign countries’ consulates in the
Philippines.
"In fact, we’re holding a briefing with the ADB (Asian Development Bank)
in July. We’re going to set up kiosks there so their employees can file
in one place. Some embassies have also asked us for our help. We’ll
arrange something for you if you get in touch with us about difficulties
with regard to compliance," she said.
The BIR chief was invited by the corps to speak on the bureau’s tax
policies, particularly the implementation of Revenue Memorandum Circular
(RMC) 31-2013, which the agency issued on April 12. During yesterday’s
forum, members of the corps raised their concerns on compliance with the
issuance.
The RMC clarified the liabilities of Filipino and alien employees
employed by foreign governments, embassies, diplomatic missions, and
other international organizations located in the Philippines and noted
that any exemption from income taxes must be granted under any duly
recognized international agreements or particular provisions of existing
laws.
The circular went on to specify the individuals granted tax exemptions
in various foreign organizations such as the United Nations and its
specialized agencies; aid agencies of other governments, like the US
Agency for International Development and the Japan International
Cooperation Agency; and organizations covered by international
agreements, such as the Asian Development Bank.
Affected individuals who were not granted such exemptions, such as
Filipino or alien employees of these foreign entities liable to
Philippine income tax under the provisions of the Tax Code, must file
their income tax returns (ITRs) and pay the taxes due on or before April
15 following the close of the taxable year, the RMC said.
Besieged with requests from embassies and organizations, the BIR
followed up the issuance with Revenue Regulations (RR) 7-2013, dated
April 29. This new issuance provided for the abatement of surcharges,
interests, and compromise penalties, which will be imposed on the taxes
due from the entities’ employees who have yet to file their 2012 tax
returns and those who ought to amend their tax returns to cover tax
deficiencies.
Under the law, late income tax return (ITR) filings are slapped with
penalties of 20% interest per annum and a 25% surcharge, as well as a
compromise penalty dependent on the amount of tax due.
The RR gave the concerned individuals until May 15 to file or amend
their 2012 ITRs and pay at least 50% of the taxes due. Following the Tax
Code, the remaining 50% of the taxes due must be paid on or before July
15.
Asked if the BIR will give the foreign entities more time to comply with
the regulations, Ms. Jacinto-Henares said, "The deadline stands. A
deadline is a deadline."
"Our stance is, we’re firm on whatever we’ve said. Our advice to all of
you is to tell your employees to file first. If they haven’t registered
and filed, how can we talk about compromises?" the BIR chief said.
Ms. Jacinto-Henares also said that any abatement of applicable penalties
for those who’ve missed the May 15 deadlines would be dealt with on "a
case-to-case basis."
"We can’t talk about reprieves if they don’t file," stressed the official.
source: Businessworld
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