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Of extensions and lockdowns

It has been a week since the government imposed the enhanced community quarantine (ECQ) and stringent social distancing measures over the entire region of Luzon. This has resulted in the suspension of classes, public transportation, and travel by land, air, and sea. Strict home quarantine is being imposed and public gatherings are prohibited. Most business establishments, except for those that provide basic necessities, such as public markets, supermarkets, hospitals, pharmacies, banks and public utility (e.g., power, water and telecommunications facilities) companies, remain open. To ensure the continuity of government services, work from home and skeleton workforce arrangements are being implemented in the executive branch, except for the PNP, AFP, PCG, and health and emergency frontline services, border control and other critical services.

In compliance with the government’s directive, our firm has, likewise, adopted a work from home policy.

As a tax practitioner, I am concerned about the incoming deadline for filing not only of the returns (income, value-added tax, and withholding), but also the replies, protest letters, and additional documents related to assessment cases. Fortunately, the Bureau of Internal Revenue (BIR) has issued Revenue Memorandum Circular (RMC) Nos. 27-2020, 28-2020, and 29-2020, all of which extend the deadlines for submitting tax returns and other filings.

RMC No. 27-2020 extends to 30 April 2020 the deadline for filing of value-added tax (VAT) refund applications covering the quarter ending 31 March 2018. RMC No. 27-2020 also suspends the counting of the 90-day period for processing: (1) those claims that are currently being evaluated; and (2) those that may be received from 16 March to 14 April 2020. The counting of the number of processing days shall resume after the lifting of the community quarantine.

On another hand, RMC No. 28-2020, which amends RMC No. 25-2020, provides that the deadline for filing and submission of the 2019 annual income tax return (AITR) has been extended from 15 April 2020 to 15 May 2020 without the imposition of penalties to taxpayers. RMC No. 28-2020 also allows taxpayers to file and pay taxes due to any Authorized Agent Banks (ABB) nearest to the location of the taxpayer or to any Revenue Collection Officer under the Revenue District Office. It should be noted however, that RMC No. 28-2020 is silent on whether the required attachments (e.g., Audited Financial Statements, Statement of Management Responsibility) may also be filed until 15 June 2020 without penalties.

Lastly, RMC No. 29-2020 extends the deadlines for the filing and payment of certain returns (e.g., BIR Form No. 1702Q for the fiscal quarter ending January, BIR Form No. 2000 and 200-OT for March 2020, and BIR Form No. 1601C for March 2020) by 30 days from the due date. Visit our website for details on the deadlines. In addition, all ONETT (One-Time Transaction) transactions (BIR Form Nos. 1706, 1707, 1800, 1801, and 1606) for which the due date of payment falls within the enhanced quarantine period shall be extended by 30 calendar days from the said due date.

However, there seems to be an oversight on the deadlines provided under RMC No. 29-2020 for BIR Form Nos. 1601C (withholding tax on compensation), 0619E (expanded withholding tax), and 0619F (final withholding tax) for February 2020, since the dates for filing pertains to the deadline for the monthly VAT returns.

While the recently issued RMCs resolved the issues on the filing and payment of tax returns, what about the filing of protest letters and the submission of documents the due date of which would fall within the enhanced community quarantine? Will there also be an extension for the filing of protest letters and submission of documents?

Filing protests, reconciliations, and/or supporting documents is very crucial, as this may result in significant tax liabilities. As much as taxpayers would like to comply, there are various challenges that hinder them in doing so, especially since the quarantine was unplanned. Moreover, taxpayers may not have their documents available with the sudden announcement of the ECQ. The ECQ, which was announced late in the evening of 16 March 2020, took effect at 12 midnight of 17 March 2020.

While taxpayers are willing to comply, challenges may hinder them in meeting the deadline, significantly affecting its ongoing assessment cases. If taxpayers wait for the suspension of the ECQ to file or submit documents, their filings may be considered late or, in a worst case scenario, may not be considered at all. This will burden taxpayers, as late filing will incur additional interest and penalties. Fortunately, the BIR issued RMC No. 31-2020 provides an extension of 30 days from the date of lifting of the ECQ for the submission and filing of letter answer, protest letters and related documents and other similar correspondences related to assessment cases (e.g. Notice of Informal Conference, Preliminary Assessment Notice, Final Assessment Notice)

These extensions are something taxpayers would greatly appreciate, and this will also ensure the health and safety of both taxpayers and BIR personnel. More importantly, I hope and pray that everyone will take the ECQ seriously to finally put an end to this pandemic.


(Note that the BIR issued on 23 March 2020 RMC No. 31-2020 which extends the period of submission/filing of documents and correspondences related to assessment cases and RMC No. 30-2020 which clarifies the extension of filing deadlines)


Anthony Joseph A. Cometa is a manager of Tax Advisory & Compliance division of P&A Grant Thornton, the Philippine member firm of Grant Thornton International Ltd.


As published in BusinessWorld, dated 24 March 2020