RR No. 03-2001: Grants moratorium on the withholding of Income Tax on the compensation income of public elementary and secondary school teachers employed by the national government

Summary

RR No. 3-2001 grants a moratorium on withholding income tax on the compensation of public elementary and secondary school teachers employed by the national government.

Key points

1. Suspension of withholding. Collection of withholding tax on the teachers’ compensation is suspended from May 1, 2001 to June 15, 2001. This gives time to process their refund claims for taxable years 1997 to 1999.
2. Offset against refunds. The tax that should have been withheld during the suspension is paid beginning August 2001 by offsetting it against approved refund claims. Any excess of the approved refund over the deferred tax is processed under existing BIR procedures.
3. Installment payment. If the refund is not enough or there is none, the teachers may pay the tax or the balance in five (5) equal monthly payments through salary deductions. These are in addition to the regular withholding tax due beginning August 2001.

Who is affected

• Public elementary and secondary school teachers employed by the national government

Deadlines and effectivity

• Moratorium: May 1, 2001 to June 15, 2001
• Payment of deferred tax begins August 2001
• Refund claims cover taxable years 1997 to 1999

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