RR No. 8-2016: Amends certain provisions of RR No. 1-2016 re: processing of applications for Tax Clearance for participation in government procurement

Key points

1. Returns and validation. Only tax returns filed through the Electronic Filing and Payment System (eFPS) are accepted under Section 1 of EO No. 398. The procuring government entity validates the returns and attachments, such as Audited Financial Statements, with the Large Taxpayers Service office or the Revenue District Office where the bidder is registered.
2. Tax Clearance validity. A Tax Clearance is valid for one (1) year from issuance, unless sooner revoked for valid reasons.
3. Criteria. The applicant has no unpaid annual registration fee, no open valid stop-filer case, and is not tagged “Cannot Be Located”. There is no pending criminal information in court from tax or tax related cases, and no delinquent account. The applicant must also be a regular eFPS user for at least two (2) consecutive months before applying. That two-month rule applies only to new applicants. Previous holders must be regular users from enrollment to the application.
4. Pending compromise or abatement. A clearance is still issued despite a delinquent account if the liability is the subject of a pending application under Section 204 of the Tax Code, as amended, and the applicant fully paid the amount offered. If the application is denied during the one (1) year validity, the taxpayer has thirty (30) days to pay in full or the clearance is revoked.
5. New delinquency and verification. If a delinquency arises during the validity period, the taxpayer is notified and has thirty (30) days to pay in full, or the clearance ceases to be valid. Clearances for bidding are verified against the list published on the BIR Website (www.bir.gov.ph) under “Announcement”. Revoked clearances are also posted.

Who is affected

• Bidders in government procurement applying for Tax Clearance
• Procuring government entities

Deadlines and effectivity

• Tax Clearance validity: one (1) year from date of issuance
• 30 days to settle unpaid liabilities after denial or a new delinquency
• eFPS use for at least two (2) consecutive months before applying (new applicants)