Publications

Tax Advisory [2018-30]: Procedure on Filing the Withholding Tax Returns

The Bureau of Internal Revenue release finally the tax advisory on the procedure on filing the withholding tax returns, except the monthly withholding tax on compensation, which were previously filed monthly due to the approval of the Secretary of Finance which has express authority given under Section 58 of the National Internal Revenue Code (NIRC) of 1997, as amended. However, with the effectivity of the Republic Act (RA) No. 10963 aka Tax Reform for Acceleration and Inclusion (TRAIN) Law this power of the Secretary to adjust the frequency of filing and paying the withholding tax due was repealed.

The TRAIN Law now provides that the payment of creditable and final withholding taxes be made not later than the last day of the month following the close of the taxable quarter during which the withholding tax was made. But since the taxes withheld by the withholding agents are held in trust for the government, it is a necessity to immediately remit those taxes to the BIR in order to ensure sufficient cashflow to the treasury. Equipped with Section 6 of the NIRC of 1997, as amended, the Commissioner of Internal Revenue (CIR) prescribes additional requirements for tax administration and enforcement on this matter.

The BIR held that taxes withhold for the first two (2) months of every taxable quarter the withholding agent shall remit those taxes using BIR Form No. 0605 on or before the 10th day (for over-the-counter filers) or 15th day (for eFPS filers) of following the month of withholding. Provided that the taxes withheld on the third (3rd) month of every taxable quarter shall be remitted thru BIR Form No. 1601EQ (or the applicable withholding tax return), not later than the last day of the month following the close of the taxable quarter during which the withholding was made.

The remittance of withholding taxes thru BIR Form No. 0605 shall be adopted until the issuance of enhanced withholding tax remittance form. Presented below are the transitory procedures for filling the said form:

Description ATC Code Tax Type
Remittance of expanded withholding tax MC200 WE
Remittance of expanded withholding tax MC200 WF

In terms of the submission of the alphabetical list of payees from whom taxes were withheld, the submission shall be not later than the last day of the month following the close of the taxable quarter during which the withholding tax was made.

Finally, the Bureau advised strict compliance with all concerned withholding tax agents to follow the mentioned procedures above starting taxable year 2018.

Please be guided accordingly.

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