Philippines: Guidance on return processing system assessment notices

Guidance on return processing system assessment notices arising from tax return information discrepancies

Guidance on return processing system assessment notices

Article Posted date 04 April 2023

The Bureau of Internal Revenue (BIR) issued Revenue Memorandum Circular (RMC) No. 7-2023 (dated 10 January 2023) providing guidance on return processing system (RPS) assessment notices arising from tax return information discrepancies, late filing of tax returns or non-payment/underpayment of taxes.

The RMC provides that:

  • An RPS assessment arises when the RPS system detects a tax return that was filed late but no penalties were paid, a tax return filed with declared tax due but no corresponding payment was detected, or a tax return filed with tax due but the payment detected was only partial.
  • The RPS assessments are not tax assessments arising from the conduct of an audit/investigation of the taxpayer's books of accounts and other relevant records, but are based on a taxpayer's own disclosures, and when left unpaid within the prescribed due date become delinquent accounts.
  • The issuance of a letter of authority (LOA) is not required for the issuance of an RPS assessment. The RPS assessment is a collection letter and sending thereof is a civil/administrative remedy of the BIR.

Read an April 2023 report prepared by the KPMG member firm in the Philippines

 

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