Special InTAX: May 2024 Issue 1 | Volume 1

InTAX is an official publication of R.G. Manabat & Co.'s Tax Group

13 May 2024

1 min read

Bureau of Internal Revenue

The Bureau of Internal Revenue (BIR) issued Revenue Memorandum Circular (RMC) No. 60-2024, 09 May 2024, providing clarifications and guidance on Section 6 of Revenue Regulations (RR) No. 4-2024 on the repeal of Section 34 (K) of the National Internal Revenue Code of 1997, as amended (Tax Code) introduced by Republic Act No. 11976 of the "Ease of Paying Taxes Act" (EoPT Law).

The BIR provided the following policies and clarifications on whether the effect of the repeal of the said Tax Code provision may be applied to all assessed cases and ongoing audits covering taxable periods prior to 22 January 2024 (the effectivity date of the EoPT Law):

TAXABLE PERIOD

Policies and Clarifications

PRIOR TO 1 January 2024

On all ongoing audits:

1. Expenses subject to withholding tax shall be allowed as deductions from gross income by the Revenue Officers (RO) only if the corresponding tax required to be withheld have been paid, whether prior to audit or submission of the audit report to the Reviewing Office.

2. Otherwise, the ROs have to recommend for the issuance of assessment notice both on income tax and the applicable withholding tax pursuant to RR No. 6-2019.

On audit cases which are already submitted to the Reviewing Office:

Paid case – Same as item 1 above.
Assessed Case – Apply the requirement of deductibility under the then Section 34(K) of the Tax Code, thus, an assessment on both income tax and withholding tax shall be issued.

1 January 2024 ONWARDS

Expenses/income payments subject to withholding tax shall be allowed as deductions from gross income for purposes of computing taxable income even if no tax withheld, provided the other requirements for deductibility have been met.

However, the taxpayer shall still be liable for the payment of the corresponding withholding tax due on said income payments.

Here is the link to the full texts of the issuance: RMC No. 60-2024.

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