RMO No. 21-2001: Prescribes the guidelines and procedures in the availment of the Voluntary Assessment Program

Summary

RMO No. 21-2001 sets the guidelines and procedures for availing of the Voluntary Assessment Program (VAP), which gives taxpayers last priority in audit and investigation for taxable year ending December 31, 2000 and all prior years.

Key points

1. Taxes covered. The privilege covers Income Tax, Improperly Accumulated Earnings Tax, Value-Added Tax, Percentage Tax, Excise Tax, Documentary Stamp Tax and Withholding Taxes. It also covers one-time transaction taxes such as Estate Tax, Donor’s Tax, Capital Gains Tax, Expanded Withholding Tax and Documentary Stamp Tax on real property and/or shares of stock not traded through the local stock exchange, and taxes under special laws.
2. Not covered. Excluded are those under a Preliminary Assessment Notice, Final Assessment Notice or Collection Letter issued on or before July 31, 2001, and persons under investigation on or before July 31, 2001. Also excluded are tax fraud cases pending in Court, and those with unpaid or previously recognized tax liabilities unless they pay them before or at availment.
3. Refund claims and income types. VAP availment on refundable returns or excess/erroneous payments with a pending refund or credit request does not automatically approve it. Taxpayers with compensation and business income may avail for both or one only.
4. Spouses and closed businesses. Husband and wife may file separate VAP application and payment forms, and one may avail even if the other does not. Taxpayers retiring from business or with closed or dissolved entities may avail if the last day of operation is not later than December 31, 2000.
5. Payment limits. VAP payment cannot be a tax credit in the year of payment or later years, nor a deduction, except as provided in Section 6.8 of the Order. Excess tax credits in returns of the covered years and unutilized Tax Credit Certificate balances cannot be used as VAP payment.

Who is affected

• Taxpayers liable for internal revenue taxes for taxable year ending December 31, 2000 and prior years
• Husband and wife
• Taxpayers retiring from business or with closed or dissolved entities

Deadlines and effectivity

• Covers taxable year ending December 31, 2000 and all prior years
• Closed or retiring businesses: last day of operation not later than December 31, 2000

Summary by Tax Resources PH. It is not a substitute for the full text of the issuance or professional advice.