RR No. 3-2007: Provides the policies, guidelines and procedures in the implementation of the Expanded One-Time Administrative Abatement of all penalties/ surcharges and interest on delinquent accounts and assessments

Key points

1. Cases covered. Covered cases include delinquent accounts, Income Tax 2nd Installment cases, dishonored checks, cases under administrative protest, and assessed cases as of November 30, 2006. Also covered are collection and civil tax cases disputed before the Department of Justice and the courts, pending compromise settlement or abatement requests, failure to withhold taxes found on audit, letter notice cases, and certain criminal violations and installment payers. Cases where the PCGG has an interest or coordination with the PCGG is needed are generally excluded.
2. Exclusions within covered categories. Compromise requests already approved at more than 100% of the basic tax are not covered. Abatement requests under RR No. 13-2001 that were already approved are not covered. Criminal cases already filed in court, or involving criminal tax fraud, the BIR Run After Tax Evaders Program or confidential information tax fraud, are excluded unless the Commissioner or his representative allows availment on meritorious grounds.
3. How to settle. Any natural or juridical person may settle a delinquent account or disputed assessment, with the Assessment Notice released as of November 30, 2006, by paying 100% or more of the Basic Tax assessed. Payment goes to the Accredited Agent Bank (AAB) of the RDO/LTS/LTDO with jurisdiction, or to the Revenue Collection Officer/Deputized Treasurer if there is no AAB. The penalty, surcharge and interest assessment is then cancelled, and the docket goes to the Office of the Commissioner through the Deputy Commissioner for Operations Group for a Termination Letter.
4. Taxpayers who already paid part of the increments. The Program includes taxpayers who already paid part of the increments, if they waive any refund claim for amounts paid in excess of 100% of the basic tax paid. Taxpayers on an approved installment plan qualify if they paid 100% or more of the basic tax as originally assessed and waive any refund claim. Government withholding agents or delinquent taxpayers that remitted 100% of the basic withholding tax but were assessed late payment penalties are also included, and the interest assessed counts as the basic tax to be paid.
5. Where to file. Applications go to the RDO for regional accounts, the Assessment Division for RO cases with administrative protest, and the Legal Division for RO judicial or legal-issue cases. For National Office cases they go to the Collection Service, Large Taxpayers Service, Legal Service or Enforcement Service, depending on the case. The office holding the case docket receives and processes the application.
6. Staggered payment and non-payment. Staggered payment may be considered case by case on approval of the Regional Director for regional cases, or the concerned Assistant Commissioner for NO cases. Cases pending in courts are not withdrawn unless the taxpayer fully pays 100% of the basic tax. If the abated amount is not paid as required, the staggered payment is nullified and the account reverts to the original assessed amount plus statutory increments.

Who is affected

• Natural or juridical taxpayers with delinquent accounts or disputed assessments
• Government withholding agents with late payment penalties

Deadlines and effectivity

• Assessment Notice released as of November 30, 2006
• In force until March 31, 2007, subject to extension by the Commissioner on meritorious grounds
• Issued February 14, 2007