THE Bureau of Internal Revenue has issued Revenue Regulations (RR) No. 6-2018 revoking RR No. 12-2013, relative to the deductibility of certain expenses.
The provisions of Section 2.58.5 stated under RR No.14-2002, as amended by RR No. 17-2003, are thereby reinstated. Any income payment that is otherwise deductible under the Tax Code will now be allowed where no withholding was made, as long as the withholding agent pays the tax (or the difference between the correct amount and the amount of tax withheld, in the case of an erroneous underwithholding), including the interest and surcharges incident to non-withholding (or underwithholding), at the time of audit/investigation or reinvestigation/reconsideration, whether the payee reported the income on the due date.
Items of deduction representing the return of capital will also be allowed as deductions upon the withholding agent’s payment of the basic withholding tax and penalties for failure to withhold.
The regulation takes effect 15 days following publication.
Source: P&A GRANT THORNTON
Certified Public Accountants
Punongbayan & Araullo (P&A) is the Philippine member firm of Grant Thornton International Ltd.
As published in SunStar Cebu dated 30 January 2018.