COURSE OUTLINE:

UPDATES IN TAXATION: BIR REGULATIONS,

MEMORANDUM CIRCULARS and ORDERS ;
As of CY 2014

DATE:

27 January 2015
9:00 AM TO 5:00 P.M.

VENUE:

EDSA Shangri-la Hotel, Mandaluyong City, M.M.

I.

8:00 AM to 10:00 A.M.

COMPLIANCE/DOCUMENTATION/GUIDELINES
1. Clarifying the provisions of RR 1-2013 on the use of E-TRA; (RMC 57-2014);
2. Requirements for Issuance of Certification for Outstanding Tax Liabilities for
purposes of tax refund, Cash Conversion of TCCs and Vat Monetization; (RMC
70-2014) (RMC 77-2014);
3. Prescribing the Uniform Format and Procedures for the Issuance of
Certifications on the Existence of Outstanding Tax Liabilities of Taxpayers
(RMO 29-2014)
4. Prescribing the Mandatory Use of Electronic Bureau of Internal Revenue Forms
(eBIRForms) in Filing of All Tax Returns by Non-Electronic Filing and Payment
System (Non-eFPS) Filers Particularly Accredited Tax Agents/Practitioners,
Accredited Printers of Principal and Supplementary Receipts/Invoices, and
One-Time Transaction (ONETT) Taxpayers; (RR 6-2014)
5. Prescribing the Uniform Guidelines and Procedures in the Remittance of All
Taxes Withheld by National Government Agencies (NGAs) to the Bureau of
Internal Revenue (BIR) Through the Use of Electronic Tax Remittance Advice
(eTRA) System; (RMO 30-2014);
6. Use of eORB as replacement for manual preparation and submission of Official
registry Books of taxpayers subject to excise taxes such as, manufacturers of
cigars, cigarettes, cigarette paper, etc.; (RR 3-2013)
7. Prescribing the Machine Identification Number (MIN) Sticker For the Use of
Cash Register Machines (CRM), Point-of-Sale (POS) System Machines and/or
Business/Sale Machines Generating Receipts/Invoices; All CRM, POS and Other
Similar Business Machine Suppliers/ Distributors/ Retailers, All Business
Establishments and All Internal Revenue Officers and Others Concerned; (RR
4-2013)
8. Amending Certain Provisions of Revenue Memorandum Order No. 10-05,
Prescribing the Policies and Procedures in the Accreditation of Cash Register
Machine (CRM), Point of Sale (POS), Other Sales Machines (RMO 27-2014);
9. Amending RR 17-2013: Preservation of Books of Accounts and Other
Accounting Records for a period of ten years; Hard copies for the first five
years and soft copies for the last five years; (RR 5-2014);
10. Returns/Forms 1701 and 1702 for self-employed individuals, with income from
compensation and business; (MC 26-2013)
11. Guidelines in the Filing, Receiving and Processing of Taxable Year 2012 Income
Tax Returns (ITRs) 1701 and 1702, and Prescribing the Additional Attachment
of the Regular Allowable Itemized Deductions to BIR Form; (MC 27-2013)

12. TENTATIVE RETURNS: Tentative Tax Return shall be considered as a final

return, unless a final amended return is filed by the concerned taxpayer.
However, once an electronic Letter of Authority or any other notice of audit is
received, taxpayers are barred from making amendments to the tentative tax
returns filed. This emphasizes that income tax returns marked as Tentative
may also be the subject of examination pursuant to Section 6(A) of the Tax
Code, as amended. (MC 50-2013)
13. Clarifying the Validity of Unused/Unissued Principal and Supplementary
Receipts/Invoices Printed Prior to January 18, 2013 and other matters; (MC
52-2013)
14. List of accredited printers of receipts; (MC 61-2013)
15. Documentary requirements for application for registration of self-employed
individuals, estates, and trusts; for local employees; and corporations,
associations, cooperatives; purely TIN Issuance; transfer of RDO registration;
and cancellation of TIN registration; (MC 70-2013)
16. Requirements for Alpha List of suppliers for creditable and withholding tax
purposes;(RR 1-2014)
17. Filing of New ITR Forms; Mandatory Itemized deductions; (RR 2-2014)
18. Guidelines in the Filing and Receiving of new BIR forms 1701 to 1702; (MC
20-2014)
19. Guidelines, procedures and requirements for requests for BIR rulings; (RMO
9-2014);
20. Prescribing the Affixture of Internal Revenue Stamps on Imported and Locally
Manufactured Cigarettes and the Use of the Internal Revenue Stamp
Integrated System (IRSIS) for the Ordering, Distribution and Monitoring
Thereof. (RR 7-2014)
21. Amending the Provisions of Revenue Regulations No. 7-2014 AND penalties;
No later than November 1, 2014, all locally manufactured packs of cigarettes
shall be affixed with the internal revenue stamps prescribed by these
Regulations; Effective March 1, 2015, all locally manufactured cigarettes found
in
the market shall be affixed with the said stamps.
No imported cigarettes
shall be found in the market without the new stamps effective April 1, 2015;
provided, however, that even prior to such date, imported cigarettes should
bear either the old stamps or the new stamps; (RR 8-2014);
22. Further amending RR 8-2014, extending the period from March 1, 2014 to
December 1, 2014 (RR 9-2014);
23. Amending Policies, Guidelines and Procedures in the Issuance of Importers
Clearance Certificate and Customs Brokers Clearance Certificate Relative to
Accreditation as Importer/Customs Broker( RMO 33-2014);
II.

10:00 A.M. to 10: 15 A.M.

BREAK

III.

10:15 A.M. TO 12:00 Noon

TAXABILITY OF TRANSACTIONS/PERSONS

1. Tax treatment of Special Allowance for the Judiciary (SAJ); (RMC 58-2014)
2. Applicability of RMC 8-2013 to general professional partnerships (GPPs);
(RMC 60-2014);
3. Tax treatment of Stock Option Plan; ( RMC 79-2014);
4. Tax Treatment of Sale of Jewelry, Gold and Other Metallic Minerals to a
Nonresident Alien Individual Not Engaged in Trade or Business within the
Philippines or to a Nonresident Foreign Corporation; Prescribing advance
payment of business and income taxes and actual payment of excise tax by
those who sell jewelry, gold and other metallic minerals to nonresident
individuals not engaged in business within the Philippines and/or the
nonresident foreign corporations; (RR 5-2013)
5. Requiring contractors with government contracts for infrastructure to submit
application for contractors final release certificate; (RMC 63-2014);
6. Inclusion of Real Estate Service Practitioners (i. e. Real Estate consultant,
Appraiser and Broker) Who Passed the Licensure Examination given by the
Real Estate Service under the Professional Regulations Commission as Among
Those Professionals Falling Under Section 2.57.2(A)(1) of RR 2-98, as
Amended, and RR 14-2002 as Regards Income Payments to Certain Brokers
and Agents; (RR 10-2013)
7. Tiangges, etc.: New rules on the collection of business and income taxes
including withholding tax on income payments by/to privilege stores
popularly known as tiangge/s and the obligations of organizers or exhibitors
of space for the operation of privilege stores as well as the obligations of the
privilege store operators; (RR 16-2013)
8. Association dues in homeowners association: requirements for
taxability and/or exemption from income tax and VAT of association dues of
homeowners association; Exemption under RA 9904; (MC 9-2013)
9. Employees of Embassies, diplomatic missions, international
organizations: Taxation of Compensation Income of Philippine Nationals and
Alien Individuals Employed by Foreign Governments/Embassies/ Diplomatic
Missions and International Organizations Situated in the Philippines; (MC 312013)
10. Donations to Homeowners Association: Clarifying the Taxability of
Donations given to Homeowners Association of Subdivisions and Villages; (MC
NO. 53-2013):
11. Online Business Transactions:
a. Business to Consumer (B2C): which involves online stores selling
goods and services to final consumers;
b. Consumer to Consumer (C2C); and
c. Business to Business (B2B): which encompasses job recruitment,
online
advertising, credit, sales, market research, technical support,
procurement and different types of training. (MC NO. 55-2013)

12. Service fees of Professionals; (RR 4-2014)

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Policies and Guidelines
13. Marginal Income Earner (MIE) - individual whose business do not realize
gross sales or receipts exceeding P100,000 in any 12 month period. (MC 72014)
14. CGT on sale of shares of stocks held as capital asset: Rules on the
Taxation of Sale, Barter, Exchange or Other Disposition of Shares of Stock Held
as Capital Assets, using FMV of shares of stocks as determined by the BIR, as
fixed by the Assessor, or as determined by an Independent Appraiser; (RR 62013)
IV.

12:00 noon to 1:00 P.M.

LUNCH

V.

1:00 P.M. to 3:00 P.M.

A. DEDUCTIONS FROM GROSS INCOME:
1. Concept of deductions; (NIRC provisions)
2. Allowable deductions; (NIRC provisions)
3. Requirement for deductions from gross income to be deductible, it must be
shown that the corresponding withholding taxes have been withheld and paid
to the BIR. Deductions shall not be allowed notwithstanding payment during
investigation/reinvestigation/reconsideration where no withholding tax was
paid; (RR 12-2013)
4. Rules on deductibility of depreciation purchase of motor vehicles and related
expenses, and allowed input taxes therefor; (MC 2-2013)
B. WITHOLDING TAXES
1. Withholding taxes defined; (NIRC)
2. Procedures for WT; (NIRC);

3. Professional Fees of medical practitioners; rates, procedures, for doctors and

hospitals; (RR 14-2013)
(a) Professional fees paid to medical practitioners.
(b). It shall be the duty and responsibility of the hospitals, clinics,
HMOs and similar establishments to withhold and remit taxes due on the
professional fees of their respective accredited medical practitioners, paid
by patients who were admitted and confined to such hospitals and clinics.
. Exception
C. TAX EXEMPTION/INCENTIVES
1. Concept; (NIRC; Supreme Court Rulings)
2. Guidelines for exemption under Section 30, NIRC; ( NIRC, Supreme Court
Rulings)
3. Guidelines, policies and procedures, documentation, requiring all hospitals and
non-stock non-profit organizations operating hospitals to secure the
revalidated tax exemption certificate, corresponding procedures; all rulings

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issued prior to Nov 1, 2012 providing for tax exemption of hospitals are no
longer valid; (MC 4-2013)
4. New PEZA guidelines on tax incentives granted to tourism economic zones and
locators; (MC 23-2014)
5. Philippine Canine Club, Inc.; tax exemption is revoked; Section 30, NIRC,
paragraph (c); requirements for tax exemption; in the course of trade or
business defined to qualify for the exemption; (MC 64-2013)
6. Documentary Requirements for Applications for Tax Exemption and
Revalidation; additional Documentary requirements for educational
institutions; guidelines in the evaluation of grant of tax exemption under
Section 30, NIRC;Corporations and associations enumerated under Section
30 of the NIRC, as amended, including those which have been issued tax
exemption rulings/certificates prior to June 30, 2012, shall file their respective
Applications for Tax Exemption/Revalidation with the Revenue District Office
(RDO) where they are registered. Only corporations or associations that are
duly qualified under Section 30 of the NIRC, as amended, shall be issued Tax
Exemption Rulings; (RMO 20-2013);
7. Clarifying Certain Provisions of Revenue Memorandum Order (RMO) No. 202013, as amended by RMO No. 28-2013, on the issuance of Tax Exemption
Rulings for Qualified Non-Stock, Non- Profit Corporations and Associations
under Section 30 of the National Internal Revenue Code of 1997, as amended.
(RMO 34-2014);
8. Requirement for presentation of tax exemption certificate for withholding
taxes, compensation income by income exempt entities; (MC 8-2014)
9. Foster Parents:
(A). Additional Exemption for Dependents
B. Incentives to Agencies.
a. Exemption from Income Tax
b. Qualification as a Donee Institution
C. Incentives to Donors
D. Exemption from Donors Tax
VI.

BREAK - 3:00 P.M. to 3:15 P.M.

VII.

3:15 P.M. to 3:30 P.M.

A. RECIPROCITY RULE:
1. Principle of Reciprocity as Basis for the Grant of Income Tax Exemptions to
International Carriers and Rationalizing other Taxes
B. VALUE ADDED TAX (VAT)
Recovery of Unutilized Creditable Input Taxes Attributable to VAT Zero-Rated Sales
C. ESTATE TAX
Clarification on the Proper Accomplishment and Filing of Estate Tax Returns;
Responsibilities of the Heir/Executor/Administrator; Responsibilities of the RDO
and Document Processing Division (DPD)

VIII. 3:30 P.M. to 5:00 P.M.

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A. ASSESSMENTS/PROCEDURES:
1. Pertinent NIRC provisions; (NIRC)
2. Concept of PAN, FAN; (NIRC)
3. Procedure in the issuance of a deficiency tax assessment;
4. Audit, assessment, and protesting deficiency assessments; legal petition Notices
(LPN) questioning Letters of Authority to Investigate;
a. Procedures on ISSUANCE OF PRELIMINARY ASSESSMENT NOTICE
(PAN), FORMAL LETTER OF DEMAND (FLD) AND FINAL ASSESSMENT
NOTICE (FAN)
b. RESPONSIBILITY OF TAXPAYERS ON THEIR LPN
5. Prescribing guidelines for receipt of protest letters form taxpayers
B. ABATEMENT/COMPROMISE OF TAX
1. Concept of Abatement/Compromise (NIRC provisions);
2. Requirements and Scope of Abatement of Surcharges, Interests and
Compromise Penalties for employees of embassies, international organizations,
diplomatic missions
3. Payment of the amount offered as compromise settlement even prior to
approval of compromise, requirements, procedures
C. AUDIT GUIDELINES
1. Procedure for Guidelines; ( NIRC)
2. Audit of Tax Returns by Revenue District Offices;
3. Policies and guidelines in the continuing audit of tax returns by the Revenue
District Offices;
4. All taxpayers are considered as possible candidates for audit;
5. Priority shall be given to the following taxpayers:
1. Professionals and sole proprietorships
2. Those engaged in but not limited to the industries (to be discussed).
3. Those who fall below the established benchmarks of tax compliance;
4. Those who maintained an ending inventory with value of 100% or more
of its gross sales; (RMO 4-2013)
D. SUBPOENA DUCES TECUM (SDT)
1. Materiality of Subpoena Duces Tecum; (NIRC)
2. Revised Guidelines and Procedures in the Issuance and Enforcement of
Subpoenas Duces Tecum and the Prosecution of Cases for Non-Compliance;
3. Amendments to RMO 10-2013 on issuance of subpoena duces tecum; new
guidelines and procedures
E. OTHER MATTERS: APPLICATION OF BIR Rulings:
1. Nature of BIR Rulings; (NIRC, Supreme Court Cases)
2. Rules on Application of BIR Rulings; (NIRC, Supreme Court Cases)
3. Non-Retroactivity of Rulings