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The legal provisions on refunding input value-added tax (VAT) upon dissolution of the company or upon the change of VAT status was unaffected by the TRAIN law.
It has been months since the Tax Reform for Acceleration and Inclusion (TRAIN) 1 took effect, on Jan. 1.
Recently, the Bureau of Internal Revenue issued Revenue Memorandum Circular (RMC) No. 21-2018.
Now that the tax filing deadline has passed, many taxpayers can breathe a sigh of relief.
The much-awaited promise to the Filipino taxpayers and one of the government’s crown jewels, the Tax Reform for Acceleration and Inclusion (TRAIN), took effect on Jan. 1.
My employed friend recently requested me to compute her annual income tax due for the prior year 2017. Her gross compensation from her lone employer was less than P250,000. I arrived at her annual income tax due after deducting the taxes withheld by her employer. I told her then that, if she receives the same amount of compensation this year, there will be no more withholding tax and annual income tax due. To my surprise, her employer continuously withheld tax on her January and February 2018 salary, even if she has been receiving the same monthly salary since last year. This was despite the passage and effectivity of the TRAIN Law effective Jan. 1, 2018 and notwithstanding the other pertinent issuances by the Bureau of Internal Revenue (BIR) early this year. Her employer explained that their reason for the continuous withholding was that they were still waiting for the BIR’s specific guidelines on implementing the new compensation tax rule in the TRAIN law.
We are about to enter the fourth month of implementation of the TRAIN law and, to this day, taxpayers still have questions about withholding taxes. The Bureau of Internal Revenue (BIR) finally issued Revenue Regulations (RR) No. 11-2018, discussing some amendments to withholding tax regulations (i.e., RR No. 2-98, as amended) effective Jan. 1, 2018.
The Philippine Economic Zone Authority (PEZA) director-general announced that sales of goods and services to PEZA-registered entities shall continue to be subject to 0% VAT.
