BIR TRAIN Briefing
BIR TRAIN Briefing
BIR TRAIN Briefing
Section 6 The Commissioner has the In exercising this authority, the following shall be
Power of the authority to determine fair observed:
Commissioner to market value of real 1. Mandatory consultation with both private and
make properties. public competent appraisers before division of
assessments and the Philippines into zones.
prescribe 2. Prior notice to affected taxpayers before the
additional determination of fair market values of the real
requirements for properties.
tax administration 3. Publication or posting of adjustments in zonal
and enforcement value in a newspaper of general circulation in
the province, city or municipality concerned.
4. The basis of valuation and records of
consultation shall be public records open to the
inquiry of any taxpayer.
5. Zonal valuations shall be automatically
adjusted once every three years.
INDIVIDUAL
INCOME
TAX
NIRC Provision NIRC TRAIN
Section 24 Taxable income of individuals are subject to the Revised personal income tax
Income tax rates following graduated rates: brackets of 2018-2022:
on individual Tax Schedule Tax Schedule effective January 1,
citizen and 2018 to December 31, 2022
Not over P10,000 5%
individual resident
Not over 0%
alien of the Over P10,000 but not P500 + 10% of the
over P30,000 excess over P10,000
P250,000
Philippines
Over P30,000 but not P2,500 + 15% of the
over P70,000 excess over P30,000
Section 24 Taxable income is subject For mixed income earners (earning both
Income tax of to the same graduated compensation income and income from business
mixed income rates and/or practice of profession), their income taxes
earners shall be:
1. For income from compensation: based on
graduated income tax rates for individuals, AND
2. For income from business and/or practice of
profession:
a. Gross sales/receipts which do not exceed the
VAT threshold of P3Million – 8% income tax on
gross sales/receipts and other non-operating
income OR income tax based on graduated
income tax rates on taxable income, at the
taxpayer’s OPTION
b. Gross sales/receipts and other non-operating
income which exceeds the VAT threshold of
P3Million – income tax based on graduated
tax rates for individuals
NIRC Provision NIRC TRAIN
Section 24 (B) (1) Philippine Charity Sweepstakes Philippine Charity Sweepstakes and
Final tax on and Lotto winnings – exempt Lotto winnings of more than P10,000
winnings from the 20% final tax shall be subject to the 20% final tax
Section 24 (B) (1) Interest income received by an The rate of final tax on interest
Final tax on individual taxpayer (except a income received by resident individual
interest on foreign non-resident individual) from a taxpayer under the expanded foreign
currency deposit depository bank under the currency deposit system increased
expanded foreign currency from 7.5% to 15% final tax
deposit (EFCD) system is subject
to 7.5% final tax
FINAL
INCOME
TAX
NIRC Provision NIRC TRAIN
Section 24 (C) The capital gains tax on net The final tax rate of 15% for net capital
Capital gains tax capital gains realized from sale, gains realized during the taxable year
on sale of shares barter, or exchange or other from the sale, barter, exchange or other
not traded disposition of shares of stock in disposition of shares of stock in a
through the stock a domestic corporation not domestic corporation except shares
exchange traded through the stock sold or disposed of through the stock
exchange is: exchange
Section 25 (C) Alien individuals and qualified Additional provision [Subsection (F)]
(D) (E) Filipino employees employed by The 15% preferential tax rate provided
Preferential tax 1. Regional or area and Regional in Subsection (C), (D) and (E) shall not
rate for Operating headquarters or be applicable to RHQs. ROHQs, OBUs
individuals multinational companies (RHQs or Petroleum service contractor and
employed by and ROHQs) [Subsection (C)] subcontractor registering with the SEC
RHQ, ROHQ, OBU 2. Offshore banking units (OBUs) after January 1, 2018
and Petroleum [Subsection (D)]
But existing RHQs, ROHQs, OBUs or
Contractors 3. Petroleum Service contractor
Petroleum service contractor and
Capital and and subcontractor [Subsection
subcontractor presently availing of the
subcontractors (E)]
preferential tax rates for qualified
are subject to a preferential tax of
employees shall continue to be
15% final withholding tax on gross
entitled to avail of the preferential tax
compensation income. rate for present and future qualified
employees.
NIRC Provision NIRC TRAIN
Section 31 Means the pertinent items of The phrase “and/or personal and
Definition of gross income specified in this additional exemptions” is removed in
Taxable Income Code, less the deductions and/or the definition.
personal and additional
exemptions, if any, authorized for
such types of income by this Code
or other special laws
Section 35 Individual taxpayers are entitled The Basic Personal and Additional
Personal to: Exemptions of individual taxpayers
Exemptions Basic Personal Exemption – are removed.
P50,000
The related provision on furnishing
and
exemption certificate is likewise
Additional Exemption – P25,000 removed.
per qualified dependent child
NIRC Provision NIRC TRAIN
Section 32 (B) The amount of tax-exempt 13th The amount of tax-exempt 13th month pay
Tax exempt 13th month pay and other benefits is and other benefits is increased to
month pay P82,000. P90,000.
Section 33 (A) Fringe benefits given to non- The Fringe Benefits Tax is increased
Tax on fringe rank and file employees are to 35% effective January 1, 2018
benefits given to subject to 32% final tax The grossed up monetary value of
non-rank and file The grossed up monetary value the fringe benefit given to non-rank
employees of the fringe benefit given to and file employees shall be
non-rank and file employees determined by dividing the actual
shall be determined by dividing monetary value by 65%
the actual monetary value by
68%
NIRC Provision NIRC TRAIN
Section 34 (M) The allowable deduction for Allowable deduction for premium
Allowable premium payments on health payments on health and/or
deduction for and/or hospitalization insurance hospitalization insurance of an
premium of an individual taxpayer is P2400 individual taxpayer is removed.
payments on per year or P200 per month,
health and/or subject to a gross family income
hospitalization threshold of P250,000.
insurance
Section 51 An individual whose gross Individual taxpayers whose taxable
Filing of individual income does not exceed his total income is subject to zero percent
income tax return personal and additional under the new graduated tax table
exemptions for dependents are (i.e., does not exceed P250,000) shall
not required to file income tax not be required to file an income tax
return (ITR). return.
NIRC Provision NIRC TRAIN
Additional provision:
The ITR shall consist of a maximum
of four (4) pages in paper OR
electronic form. It shall only contain
the following information:
Personal profile and information
Gross sales receipts or income
from compensation, from business,
or from exercise of profession
(except income subject to final tax)
Allowable deductions
Taxable income
Income tax due and payable
NIRC Provision NIRC TRAIN
Section 90 Estate tax returns shall be filed The filing of estate tax returns shall
Time of filing of within six (6) months from the be within one (1) year from the
estate tax return decedent’s death. decedent’s death.
Estate Tax
NIRC Provision NIRC TRAIN
Section 91 (C) No provision In case the available cash of the
Payment by estate is insufficient to pay the total
installment of estate tax due, payment by
estate tax [new] installment shall be allowed within
two (2) years from the statutory date
of payments, without civil penalty
and interest.
Estate Tax
NIRC Provision NIRC TRAIN
Section 97 If a bank has knowledge of the If a bank has knowledge of the death
Payment of tax death of a person, who maintained of a person, who maintained a bank
antecedent to the a bank deposit account alone, or deposit account alone, or jointly with
transfer of shares, jointly with another, it shall not another, it shall allow any withdrawal
bonds, or rights allow any withdrawal from the said from the said deposit account,
deposit account unless the subject to a final withholding tax of
Commissioner has certified that (6%).
the taxes imposed thereon have
been paid.
DONOR’S
TAX
Donor’s Tax
NIRC NIRC TRAIN
Provision
Section 99 The donor’s tax for each calendar year shall be The donor’s tax for is fixed at 6%
Rates of tax computed on the basis of the total net gifts made based on annual total gifts exceeding
during the calendar year in accordance with the ₱250,000 (exempt gift), regardless of
graduated tax table. whether the done is a stranger or not.
NET GIFT TAX NET GIFT TAX
Not over ₱100,000 Exempt Over ₱1M but ₱44,000 + 8% of the
Over ₱100,000 but 2% of the excess not over ₱3M excess over ₱1M
not over ₱200,000 over ₱100,000 Over ₱3M but ₱204,000 + 10% of
Over ₱200,000 but ₱2,000 + 4% of not over ₱5M the excess over ₱3M
not over ₱500,000 the excess over Over ₱5M but ₱404,000 + 12% of
₱200,000 not over the excess over ₱5M
Over ₱500,000but ₱14,000 + 6% of ₱10M
not over ₱1M the excess over Over ₱10M ₱1,004,000 + 15% of
₱500,000 the excess over
₱10M
Donor’s Tax
NIRC Provision NIRC TRAIN
Section 99 The donor’s tax shall be 30% of the The donor’s at is fixed at 6% based on
Rates of tax net gifts when the done or annual total gifts exceeding
beneficiary is a stranger. ₱250,000 (exempt gift) regardless of
whether the donee is a stranger or
not.
Donor’s Tax
NIRC Provision NIRC TRAIN
Section 100 The amount by which the fair Additional proviso:
Transfer for less market value of the property Even if the sale, exchange or other
than adequate transferred exceeded the value of transfer of property is for an
consideration the consideration received for insufficient consideration, the same
such transfer, shall for purpose of will still be considered made for
donor’s tax, be deemed a gift and adequate and full consideration
included in computing the amount provided that such transfer is made
of gifts made during the year. in the ordinary course of business,
i.e.,:
A bona fide transaction;
At arm’s length; and
Free from donative intent.
Donor’s Tax
NIRC Provision NIRC TRAIN
Section 101 Dowries or gifts made on account The exemption of dowries (gifts
Exemption of of marriage by parents to each of made on account of marriage) is
certain gifts their legitimate, recognized , removed.
natural, or adopted children to the
extent of the first ₱10,000 shall be
exempt from donor’s tax.
VALUE
ADDED
TAX
NIRC Provision NIRC TRAIN
Section 106 (A)(2) The following are entitled to VAT zero- The following sales by VAT
Zero-rated Sale of rating: registered persons shall be subject
Goods or Properties to zero percent 0% rate:
1. The sale and actual shipment of
goods from the Philippines to a 1. The sale and actual shipment of
foreign country, irrespective of any goods from the Philippines to a
shipping arrangement that may be foreign country, irrespective of
agreed upon which may influence any shipping arrangement, paid
or determine the transfer of for in acceptable foreign
ownership of the goods so currency or its equivalent in
exported and paid for in acceptable goods or services, and
foreign currency or its equivalent in accounted for in accordance
goods or services, and accounted with the rules and regulations of
for in accordance with the rules the Bangko Sentral ng Pilipinas
and regulations of the Bangko (BSP).
Sentral ng Pilipinas (BSP).
NIRC Provision NIRC TRAIN
Section 106 (A)(2) 2. Sale and delivery of goods to:
Zero-rated Sale of
Goods or Properties Registered enterprises within a
separate customs territory
Section 108 (B) 2. Services other than those 2. Services other than those
Zero-rated Sale mentioned in the preceding mentioned in the preceding
of Services paragraph, rendered to a person paragraph, rendered to a person
engaged in business conducted engaged in business conducted
outside the Philippines or to a outside the Philippines or to a
nonresident person not engaged nonresident person not engaged in
in business who is outside the business who is outside the
Philippines when the services are Philippines when the services are
performed, [51] the consideration performed, the consideration for
for which is paid for in acceptable which is paid for in acceptable
foreign currency and accounted foreign currency and accounted
for in accordance with the rules for in accordance with the rules
and regulations of the Bangko and regulations of the Bangko
Sentral ng Pilipinas (BSP); Sentral ng Pilipinas (BSP);
NIRC Provision NIRC TRAIN
Section 108 (B) 6. Transport of passengers and 6. Transport of passengers and cargo
Zero-rated Sale cargo by domestic air or sea by domestic air or sea vessels
of Services vessels from the Philippines to a from the Philippines to a foreign
foreign country. country.
Section 109 upon the production of for their own use and not for barter or sale,
VAT-exempt evidence satisfactory to the accompanying such persons, or arriving
transactions Commissioner, that such within a reasonable time: Provided, That
persons are actually coming to the Bureau of Customs may, upon the
settle in the Philippines and production of satisfactory evidence that
that the change of residence is such persons are actually coming to settle
bona fide. in the Philippines and that the goods are
brought from their former place of abode,
exempt such goods from payment of
duties and taxes:
NIRC Provision NIRC TRAIN
Section 109 (W) Sale or lease of goods (Z) Sale of gold to the BSP.
VAT-exempt or properties or the
Transactions performance of services (AA) Sale of drugs and medicines prescribed
other than the transactions for diabetes, high cholesterol, and
specifically mentioned as hypertension beginning January 1, 2019.
VAT-exempt, the gross
annual sales and/or Now (BB) Sale or lease of goods or
receipts do not exceed the properties or the performance of services
amount of P1,919,500.00 other than the transactions mentioned in the
(as amended). preceding paragraphs, the gross annual
sales and/or receipts do not exceed the
amount of P3,000,000.
NIRC Provision NIRC TRAIN
Section 110 (A)(2) The input tax on the Amortization of input VAT shall only
(b) purchase of capital allowed until December 31, 2021.
Amortization of goods with a cost
Input VAT from exceeding P1,000,000.00 After such date, taxpayers with
Purchases of shall be amortized based unutilized input VAT on capital goods
Capital Goods on its useful life or 60 purchased or imported shall be
months, whichever is allowed to apply the same as
shorter. scheduled until fully utilized.
NIRC Provision NIRC TRAIN
Section 112 The Commissioner shall The period of granting by the Commissioner
Refunds or Tax grant a refund or issue a of refunds is decreased to 90 days (from 120
Credit of Input VAT tax credit certificate for days) from the date of submission of
creditable input taxes complete documents in support of the
within 120 days from the application.
date of submission of
complete documents. The granting of tax credit instead of refund is
removed.
Additional provision:
Should the Commissioner find that the grant of
refund is not proper, the Commissioner must
sate in writing the legal and factual basis for
denial.
NIRC Provision NIRC TRAIN
Section 112 Failure on the part of the The deemed denial of failure to act on the
Refunds or Tax Commissioner to act on application is removed.
Credit of Input VAT the application within the
period prescribed shall Additional provision:
be deemed a denial of
the application. Failure on the part of any official, agent, or
employee of the BIR to act on the application
within the ninety (90) – day period shall be
punishable under Section 269 of the Tax Code
(administrative fine and imprisonment).
NIRC Provision NIRC TRAIN
Section 114 (A) VAT taxpayers shall file Beginning January 1, 2023, the filing and
Return and Payment quarterly return within 25 payment shall be done within 25 days
of VAT days following the close following the close of each taxable quarter.
of each taxable quarter,
while payment of the VAT
shall be made on a
monthly basis upon filing
of monthly VAT
declaration.
NIRC Provision NIRC TRAIN
Section 127 Sale, barter or exchange of shares of The rate of the stock transaction
Stock transaction stock listed and traded through the tax is increased to 6/10 of 1%
tax
local stock exchange shall be subject
to a tax of ½ of 1% of the gross
selling price or gross value in money
of the shares of stock sold, bartered,
exchanged or otherwise disposed
-
Pyrolysis gasoline
P 7.00 P 9.00 P 10.00
(g) Unleaded premium gasoline, per liter of P 4.35
volume capacity
(h) Kerosene, per liter of volume capacity P 0.00 P 3.00 P 4.00 P 5.00
(i) Aviation turbo jet fuel, per liter of volume P 3.67
capacity
Aviation gas - P 4.00 P 4.00 P 4.00
(j) Kerosene, when used as aviation fuel, per P 3.67
liter of volume capacity
Petroleum
PRODUCTS RA TRAIN
10351/
RR
January January January
17-2012 1, 2018 1, 2019 1, 2020
On coal and coke, per metric ton P 10.00 P 50.00 P 100.00 P 150.00
Minerals
Types of Sweeteners
Caloric Sweetener - refers to a substance that is
sweet and includes sucrose, fructose, and glucose
Sweetened
that produces a certain sweetness.
Beverages
High Fructose Corn Syrup – refers to a sweet
saccharide mixture containing fructose and glucose
which is derived from corn and added to provide
sweetness to beverages, and which includes other
similar fructose syrup preparations.
124
Types of Sweeteners
Non-Caloric Sweetener - refers to a substance
that is artificially or chemically processed that
Sweetened produces a certain sweetness. These are
substances which can be directly added to
Beverages
beverages, such as aspartame, sucralose,
saccharin, acesulfame potassium, neotame,
cyclamates and other non-nutritive sweeteners
approved by the codex alimentarius and adopted
by the FDA.
125
Subject to Excise Tax
Sweetened juice drinks;
Sweetened tea;
All carbonated beverages;
Sweetened
Flavored water;
Beverages
Energy and sports drinks;
Products
Other powdered drinks not classified as milk,
juice, tea, and coffee;
Cereal and grain beverages; and
Other non-alcoholic beverages that contain
added sugar
126
NOT Subject to Excise Tax
All milk products
One Hundred Percent (100%) natural fruit juices
w/o added sugar/ caloric sweetener
Sweetened
One Hundred Percent (100%) natural vegetable
Beverages juices w/o added sugar/ caloric sweetener
Products Meal replacement and medically indicated
beverages for oral nutritional therapy
Ground, instant soluble and pre-packaged
powdered coffee products.
127
Manufacturer
Persons Owner or Possessor of untaxed
Liable
products
Importer
128
Tax Rate
PRODUCT (per liter)
Using purely caloric sweeteners, and P6.00
Tax Rates and purely non-caloric sweeteners, or a
Bases mix of caloric and non-caloric
sweeteners
Using purely high fructose corn syrup P12.00
or in combination with any caloric or
non-caloric sweetener
Using purely coconut sap sugar and Exempt
purely steviol glycosides
129
VIOLATION PENALTIES
Misdeclaration or summary cancellation
Penalties misrepresentation of or withdrawal of his
sworn statement permit
any of the acts or treble the aggregate
omissions in violation amount of deficiency
of the Act and taxes, surcharges and
implemented by these interest
Regulations
138 VIOLATION PENALTIES
any of the acts or omission criminal liability and
prohibited under the Act penalty under
Section 254 of the
Penalties NIRC
willfully aids or abets in the criminal liability as
commission of any such the principal;
act or omission
If the offender is not a Deported
citizen of the Philippines immediately after
serving the sentence
139
1. Registration (Sec. 154; RMO 38-2003)
Permit to Operate as Manufacturer/ Permit to
Operate as Toll-Manufacture/ Permit to
Admnistrative Operate as Importer
Requirements for
Permit to Register Brands and Variants (Sec.
Excise Taxpayers 143 & Sec. 245)
2. Issuance of Assessment Number (RMO 38-2003)
3. Posting of Bonds (Sec. 160)
4. Issuance of ATRIGs (RMO 35-2002; RMO 14-2014)
5. Issuance of Export Permit (RMO 38-2003; Sec. 159)
140
6. Transfer or Sale or Disposition of Raw
Materials and/or Semi-processed goods
7. Maintenance of Official Register Book
Admnistrative (ORB) (Sec. 153)
Requirements for 8. Assignment of Revenue Officer On Premise
Excise Taxpayers (ROOPs) (Sec. 16; RMO 18-86/LTS Memo 3-2005)
9. Regular Stocktaking of Inventories (Sec. 6C)
10. Use of BIR Form on All Removals of SB (BIR
Form No. 2299 - Excise Taxpayer’s Removal
Declaration)
141
1. Excise Taxpayer engaged in manufacturing
and importing of SBs shall register with
Excise LT Regulatory Division (ELTRD) for
Large Taxpayers or with the Revenue District
Transitory Office (RDO) for Non-Large Taxpayers where
Provisions the taxpayer is required to be registered for
updating of their Certificate of Registration
(BIR Form No. 2303) using BIR Form No.
1905 to add an excise tax type. The
application for registration shall be filed on
or before January 31, 2018.
142
1. Liposuction
Definition of 2. Mammoplasty
Terms 3. Breastlift
4. Buccal Fat Reduction
5. Buttocks
Augmentation
152
Invasive Cosmetics Procedures
6. Chin Augmentation
7. Facelift/Necklift
Definition of
8. Thread Lift
Terms
9. Hair Restoration/
Transplantation
10. Eyelid Surgery
153
Invasive Cosmetics Procedures
11. Vaginal Plastic
Surgery
Definition of 12. Abdominoplasty or
Terms Tummy Tuck
13. Auto Grafting
14. Rhinoplasty/ Alar
Trimming
15. Otoplasty
154
5. Non-Invasive Cosmetic Procedure -
refers to a conservative treatment that
does not require incision into the body or
Definition of the removal of tissue, or when no break in
Terms the skin is created and there is no contact
with mucosa, or skin break, or internal
body cavity beyond a natural or artificial
body orifice. Non- Invasive Cosmetic
Procedures shall include, but not be
limited to the following:
155
Non-invasive Cosmetics Procedures
1. Acupuncture Rejuvenation
Therapy
Definition of 2. Air Dissector
Terms 3. Botulinum Toxin
Injection/Treatment
4. Collagen Induction Therapy
5. Dermal Fillers (Crosslinked and
Non-Crosslinked)
6. Embedded Protein Threads
156
Non-invasive Cosmetics Procedures
7. Non-surgical facelifting &
skin tightening using
radio frequency,
Definition of ultrasound, infrared
Terms 8. Fractional CO 2
9. Lasers and Light
Treatments
10.Body Treatments and
Contouring Procedures
157
Non-invasive Cosmetics Procedures
*The excise tax is to be billed/withheld and remitted by the Melo Medical Group,
Inc. and should be shown as a separate item in the Official Receipt
(as shown in Annex A)
A”
174
Accounting Entries
CASH 52,232.15
Administrative
Requirements FWT-EXCISE TAX 2,232.15 OUTPUT
TAX 5,357.15
SERVICE INCOME 44, 642.85
175 Illustration
B. Where the procedure is performed in a clinic operating
inside a hospital.
Note (1): Medical, dental, hospital and veterinary services are exempt from value added
tax under Section 109(G) of the NIRC, as amended, except those rendered by
professionals.
Note (2): Doctor P is presumed to be self-employed and his annual receipts exceeded the
threshold for VAT of P3 Million.
177
Accounting Entry (Doctor P’s book):
Cash 18,571.43
Accounts Receivable – Hospital 18,571.43
178
Accounting Entry (Hospital’s books):
Cash P 73,392.86
Professional Fees Expense 17,857.14
Administrative Input VAT 2,142.86
Requirements FWT-Excise Payable P 3,392.86 Output
VAT 2,142.86
Payable to Doctor 18,571.43 Expanded
Withholding Tax Payable
- Prof Fees 1,428.57
Service Income - VAT 17,857.14 Service
Income – Non-VAT 50,000.00
179
Accounting Requirements
Not withstanding the provisions of Section
233, all persons subject to excise tax under
Section 150-A of the Tax Code shall, in
Administrative
Requirements addition to the regular accounting records
required, maintain a subsidiary ledger on
which every service rendered/performed on
any given day is recorded. The subsidiary
ledger shall contain the following
information:
180 Accounting Requirements
1. Name of Patient
2. Taxpayers Identification Number
3. Invasive Cosmetic Procedures Performed (indicate if
excisable or not; if not excisable, keep records as proof that
Administrative the procedures are not taxable)
Requirements 4. Non-invasive Cosmetic Procedures Performed
5. Official Receipts Number
6. Gross Receipts Number (net of VAT and 5% excise tax)
7. 5% Excise Tax to be Withheld and Remitted
8. 12% VAT due
9. Total Amount to be Collected from Customer (sum of 6, 7,
8)
10. Remarks (description of cosmetic procedure performed)
Violations of these Regulations shall be subject to the
181
corresponding penalties under Title X of the NIRC, as amended.
1. Any violation of the provision of this Regulation shall be
subject to the corresponding penalties under Sec. 250
and 255 of the NIRC as amended and RMO 7-2015.
2. Any person who willfully attempts in any manner to
Penalties evade or defeat any tax imposed under this regulation or
the payment thereof shall, in addition to other penalties
provided by law, upon conviction thereof, be punished
with a fine of not less than P500,000 but not more than
P10 Million, and imprisonment of not less than 6 years
but not more than 10 years. The conviction or acquittal
obtained under this section shall not be a bar to the
filing of a civil suit for the collection of taxes.
182
2. Any person willfully aids or abets in the
commission of any such act or omission
shall be criminally liable in the same manner
as the principal; and
Penalties
3. If the offender is not a citizen of the
Philippines, he shall be deported immediately
after serving the sentence, without further
proceedings for deportation.
183 Except as the Commissioner otherwise permits, the
return shall be filed with and the final excise tax
withheld remitted to any authorized agent bank
Filing of (AAB) under the jurisdiction of the Revenue District
Returns and Office/BIR Office where the taxpayer (Head Office of
Payment of the business establishment) is registered or required
Excise Tax on to register.
Invasive
Procedures For taxpayers located outside the National Capital
Region (NCR) and in cases where there are no duly
accredited agent banks within the municipality or city,
Excise Tax due shall be filed and payments made to the
Collection Agent or duly authorized Treasurer of the
Municipality/City where such taxpayer (head office of
the business establishment) is required to be registered.
184
Exceptions
COSMETIC
OFFICIAL RECEIPT PROCEDURES AMOUNT COLLECTED
Gross Receipts
(Net of 5% Excise Tax
No. Date PERFORMED VAT /Excise) Withheld 12% VAT Total
187 Application for Permit to Operate
Any person subject to excise tax under
Section 150-A of the Tax Code, as amended,
Administrative shall file an application for a Permit to
Requirements Operate with the Excise LT Regulatory
Division (ELTRD) BIR National Office (whether
Large or Non-Large Taxpayers) not later than
fifteen (15) days from the effectivity of this
Regulations.
188 Application for Permit to Operate
The application shall be accompanied by the following:
1. Request Letter
Attention: Chief, Excise LT Regulatory Division
Administrative
Requirements 2. Certificate of Securities and Exchange
Commission, together with Articles of
Incorporation and By-Laws (for corporation and
partnership) and Certificate of Registration with
the Office of the Domestic Trade and Industry (for
individual)
189 Application for Permit to Operate
3. Mayor’s Permit
4. BIR Certificate of Registration (with latest
registration fee BIR Form 0605)
Administrative
5. Latest Copy of Income Tax Return
Requirements
6. Location Map of Clinics/Hospitals where the
medical professionals/practitioners perform
the services
7. Price list (whether inclusive of VAT or the 5%
excise tax) of Invasive/Non-invasive
Cosmetic Procedures
190 Application for Registration
Every person subject to excise tax under Section
150-A of the Tax Code, as amended, shall register as
Excise Taxpayer engaged in the performance of
Administrative Invasive Cosmetic Procedures with the ELTRD for
Requirements Large Taxpayers or with the Revenue District Office
(RDO) for Non-Large Taxpayers where the taxpayer
is required to be registered for updating of
Certificate of Registration. The application for
registration shall be filed within ten (10) days from
the effectivity date of this Regulations.
191
For the effective implementation of the Act,
the following guidelines shall be followed
during the transitory period:
Transitory
1. Taxpayer may continue to use existing
Provision
Official Receipts for a period of six (6)
months. After the said period, taxpayer
must apply for separate sets of Official
Receipts for invasive cosmetic procedures
and non-evasive cosmetic procedures.
192
2. All individual practitioners and juridical entities
including medical clinics or hospitals performing
invasive cosmetic procedures shall update their
Transitory current Certificate of Registration (COR) to
include the tax type: Final Withholding Tax –
Provision Excise (FWT-Excise) on Cosmetic Procedures
using BIR Form 1905 with the concerned offices:
the ELTRD or Large Taxpayers Assistance
Division (LTAD) for large taxpayers registered
under the LTS and Revenue District Office (RDO)
having jurisdiction over the non-large taxpayer.
193
Section 232 Those whose gross quarterly Those whose gross annual sales,
Keeping of books sales, earnings, receipts or output earnings, receipts or output exceed
of accounts exceed P150,000 shall have their ₱3,000,000 shall have their books of
books of accounts audited and accounts audited and examined
examined yearly by independent yearly by independent CPAs and their
Certified Public Accountants ITRs accompanied with a duly
(CPAs) and their ITRs accomplished AIF.
accompanied Account
Information Form (AIF).
NIRC Provision NIRC TRAIN
General interest 20% interest on any unpaid amount General interest on unpaid amount of
of tax from the date prescribed for tax is changed to 12% (at double the
payment until the amount fully paid rate of legal interest rate for loans or
forbearance of any money in the
absence of an express stipulation as
set by the BSP; prevailing BSP-set
legal interest is 6%)
Additional proviso:
Deficiency and delinquency interest
shall in no case be imposed
simultaneously.
NIRC Provision NIRC TRAIN
Deficiency Deficiency interest is assessed and The period when deficiency interest
interest collected from the date prescribed shall stop to run is until full payment
for its payment until full payment OR upon issuance of a notice and
thereof. demand by the BIR Commissioner;
whichever comes earlier.
NIRC Provision NIRC TRAIN
Section 254 Any person who willfully attempts Administrative fine is increased to not
Attempt to evade in any manner to evade or defeat less than P500,000 but not more
or defeat tax any tax imposed under this Code than P10,000,000
or the payment thereof shall, in
addition to other penalties Imprisonment is increased to not less
provided by law, upon conviction than 6 years but not more than 10
thereof; be punished by a fine of years
not less than P30,000 but not more
than P100,000 and suffer
imprisonment of not less than 2
years but not more than 4 years.
NIRC Provision NIRC TRAIN
Section 264 Fine of not less than P1,000 but Administrative Fine is increased to
Failure or refusal not more than P50,000 and not less than P500,000 but not more
to issue receipts imprisonment of not less than 2 than P10,000,000
or invoices years but not more than 4 years for
any person who: Imprisonment is increased to not less
Print receipts/invoices without than 6 years but not more than 10
authority from the BIR years
Print double or multiple sets of
invoices or receipts Additional punishable offense:
Print unnumbered Printing of other fraudulent receipts
receipts/invoices not bearing the or sales or commercial invoices
name, business style, TIN and
business address of the entity
NIRC Provision NIRC TRAIN