DoF waives audit for 2018 tax deficiencies
THE government is allowing taxpayers to voluntarily settle their tax deficiencies sans audit for the taxable year 2018. In a statement on Monday, the Department of Finance (DoF) said it issued Revenue Regulations 21-2020 on the implementation of a Voluntary Assessment and Payment Program (VAPP) for taxable year 2018.
VAPP will allow taxpayers to voluntarily pay their unpaid internal revenue tax liabilities with or without an ongoing audit of or investigation into their finances.
Those who do so will no longer be audited or investigated for 2018 for the tax types availed.
The program, which will run until December 31 this year, aims not only to increase the tax collections of the Bureau of Internal Revenue but also provide taxpayers a convenient way of
settling their tax liabilities.
“This program covers all internal revenue taxes due for the taxable year ending Dec. 31, 2018, and for fiscal year 2018 ending on the last day of July 2018 to June 2019,” the DoF said.
It also covers one-time transactions (ONETT) such as the payment of estate taxes, donor’s taxes and capital gains taxes, as well as ONETT-related creditable withholding taxes or expanded withholding taxes and documentary stamp taxes.
“Taxpayers who wish to avail of the VAPP must generally pay the higher of a certain percentage of 2018 gross sales or 2018 taxable net income, based on the increase or decrease in total taxes paid from
taxable years 2017 to 2018, subject to minimum amounts based on subscribed capital,” said the DoF.
For non-ONETT withholding taxes, taxpayers must pay 5 percent of the total basic withholding tax remittance for the taxable year 2018.
For ONETT taxes, the amount to be paid shall be the basic tax due on the unfiled tax return or unpaid tax due plus 5 percent.
The DoF said that for taxpayers who have already settled any non- ONETT tax deficiency covering the taxable year 2018, the basic tax deficiency shall be considered as payment for 2018 in the computation of the amount of voluntary payment required under the VAPP.
“This will significantly reduce the required VAPP payments for these taxpayers who have already settled their previous tax audits or investigations,” it said.