RMC No. 13-2003: Clarifies the termination of audit and investigation of tax returns in the light of the pronouncement of President Arroyo

Key points

1. No new audit orders. No new LAs, Audit Notices (ANs), Tax Verification Notices (TVNs), Mission Orders or other written orders to audit or investigate internal revenue taxes are issued, except in the listed cases. These are refund or tax credit claims, returns with excess Withholding Tax carry-over or excess input tax, Estate, Donor’s, Capital Gains, Expanded Withholding and Documentary Stamp Tax returns (unless no LA/AN/TVN is needed), tax clearance requests for retirement, cessation or corporate reorganization, and other cases the Commissioner directs and approves.
2. Who issues them. LAs and ANs for the exceptions are issued by the Regional Director unless the Commissioner directs otherwise.
3. TVNs signed by Revenue District Officers. RDOs continue to sign TVNs for VAT and Income Tax refund or credit claims of P 100,000 and below, Excise Tax claims regardless of amount, and claims on erroneous or double payment regardless of amount. They also sign for taxpayers retiring from business with gross assets of P 10 Million and below, and for protested or reinvestigation cases.
4. Termination of old audits. All audit and investigation of internal revenue taxes for taxable year 2001 and prior years is terminated and reported on or before May 31, 2003. Cases with preliminary or final assessment notices already issued are still acted upon under existing policies and procedures.
5. Exclusions. The Circular does not include cases under the Large Taxpayers Service, Tax Fraud Division and Special Task Forces.

Who is affected

• Taxpayers under audit or investigation for taxable year 2001 and prior years
• Taxpayers with refund claims or requesting tax clearance

Deadlines and effectivity

• Audits for taxable year 2001 and prior years terminated and reported on or before May 31, 2003