RMC No. 82-2014: Publishes the full text of Joint Circular No. 002.2014 of the DOF, DBM, BOC and BIR, providing for the establishment of a mechanism for qualified VAT-registered persons to receive the cash equivalent of their outstanding VAT Tax Credit Certificates

Key points

1. Qualified TCCs. VAT TCCs with Notices of Payment Schedule (NPS) issued by the BIR, and VAT Drawback TCCs approved for monetization by the BOC, qualify for monetization. All other VAT TCCs outstanding as of December 31, 2012, and VAT TCCs issued after December 31, 2012, qualify for cash conversion despite existing rules prohibiting or restricting it.
2. Payment of NPS. NPS holders may present the NPS on or before the maturity dates indicated on it. The BIR pays the total face value, net of any delinquent tax liability, within forty-five (45) calendar days from presentation, with the period starting on the first day of the following month for NPS presented on or before the 15th, or the 16th of the following month if presented after the 15th.
3. Where and how to apply. Cash conversion of import VAT TCCs and Drawback VAT TCCs is filed with the BOC, and all other VAT TCCs with the BIR. A complete application has a letter of application, the original TCC, proof of authority of the representative, and for import VAT and Drawback TCCs a BOC Collection Service certification or a Statement of the Outstanding Account.
4. Evaluation criteria. The TCC must have been duly issued by the government, show no tampering, be held by the rightful owner, not yet be expired, and have a remaining creditable or outstanding balance.
5. Rights retained and later issuance. A holder who does not avail of these provisions keeps the right to credit the TCC against tax or duty liabilities and to apply for revalidation under Section 230(B) of the NIRC. Upon effectivity of Executive Order No. 68-A, the BIR and BOC no longer issue VAT TCCs unless applied for under Section 112(A) of the NIRC or Section 106(e) of the TCCP, and those issued may be cash converted.

Who is affected

• Qualified VAT-registered persons holding VAT TCCs
• Holders of Notices of Payment Schedule

Deadlines and effectivity

• NPS presentation: on or before maturity date
• BIR payment: within 45 calendar days from presentation
• Outstanding VAT TCCs as of December 31, 2012, and those issued after that date, qualify for cash conversion