RMC No. 14-2002: Prescribes the procedures for the manner of filing of tax returns for income derived by Foreign Currency Deposit Units from foreign currency and other transactions and the manner of reporting their income for income tax purposes

Key points

1. Two returns for the same year. A bank with an FCDU files one return for its Regular Banking Unit (RBU) income. It files another for FCDU transactions income subject to the 10% rate and other income subject to the regular corporate income tax rate.
2. Separate TIN. The Bureau’s Large Taxpayers Assistance Division I automatically issues a new and separate TIN for FCDU income on or before April 15, 2002. The existing TINs stay valid for RBU transactions and payments.
3. Filing and payment. The FCDU return is filed separately from the RBU return within sixty (60) days after the end of each of the first quarters of the calendar or fiscal year. The tax is paid to the Authorized Agent Bank/Collection Agent of the Revenue District/BIR Office where the taxpayer is registered or required to be registered.
4. Withheld interest income. Interest from foreign currency loans to residents, where the 10% tax was already withheld by the payor-borrower as withholding agent, is reported in the FCDU return for information purposes.
5. Separate books. The FCDU keeps records and books of accounts separate from regular banking transactions. They are kept at the principal place of business and made readily available for inspection by authorized BIR personnel.

Who is affected

• Banks with Foreign Currency Deposit Units
• Depositary banks

Deadlines and effectivity

• New FCDU TIN issued on or before April 15, 2002
• FCDU return: within sixty (60) days after the end of each of the first quarters of the calendar or fiscal year