Tuesday, December 23, 2008 Tax notes: Top 10,000 corporations expanded to 20,000
THE Bureau of Internal Revenue (BIR) issued Revenue Regulations (RR) 14-2008 increasing the coverage of withholding tax agents required to withhold one percent and two percent tax from regular suppliers of goods and services, respectively, from the top 10,000 private corporations to top 20,000 private corporations.
Top 20,000 private corporations include corporate taxpayers that are determined and notified by the BIR as having satisfied any of the following criteria:
1. Classified and duly notified by the BIR Commissioner as a large taxpayer under RR 1-98, as amended, or belonging to the top 5,000 private corporations under RR 12-94, as amended, or to the top 10,000 private corporations under RR 17-2003, unless previously de-classified as such or had already ceased business operations;
2. Any taxpayer with net value-added tax (VAT) paid or payable for the preceding year of at least P100,000;
3. Any taxpayer with annual income tax paid or payable for the preceding year of at least P200,000;
4. Any taxpayer with percentage taxes for the preceding year of at least P100,000;
5. Any taxpayer whose gross sales for the preceding year is over P10 million; and
6. Any taxpayer whose gross purchases for the preceding year is over P5 million.
All taxpayers previously included in the list of top 5,000 private corporations under RR 12-94, as amended, and those that qualified as top 10,000 private corporations under RR 17-2003 shall continue to withhold one percent for purchase of goods and two percent for purchase of services, unless any of the following situations occur:
1. The BIR Commissioner communicates in writing that they have ceased to qualify as taxpayers under the list of top 20,000 private corporations; or
2. Those officially identified to have ceased business operations or undergone any of the business combinations, wherein by operation of law, the juridical personality of said taxpayers had ceased. (Source: Punongbayan & Araullo)
