BIR holds briefing on year-end adjustments

By Mari Cruz

BAGUIO CITY -- To ensure a continuing taxpayer education, a briefing on year-end adjustments and other tax updates was conducted by the Bureau of Internal Revenue, Revenue District Office No. 8 here.

BIR –Cordillera Administrative Region Director Eduardo Bajador said that this measure is also being done to intensify BIR’s efforts to achieve its collection target for taxable year 2011.

He called on all government withholding agents, in the region to accurately withhold, perform year-end adjustments in accordance with Revenue Memorandum Circulars (RMC) No. 21-2010 and No. 23-2007 and Revenue Regulations (RR) No. 10-2008, to avoid unnecessary penalties including administrative sanctions and even criminal charges.

Meanwhile, Jeanette Maria Mabalot reported that pursuant to a recent Revenue Memorandum Circular (RMC) No. 27-2011, voluntary contributions in excess to what the law allows are no longer excludible from the gross income of the taxpayer, hence, it is not exempted from income and withholding tax.

Consequently, the exemption from withholding tax on compensation referred to in Section 2.78.1 (b)(12) of RR 2-98 shall apply only to mandatory/compulsory contributions of the Government Service Insurance System (GSIS), Social Security System (SSS), Medicare and Pag-Ibig contributions.

She emphasized that GSIS optional and PAG-IBIG II contributions are not mandatory in nature so they are included in the taxable compensation income.

Effectivity of said law is July 1, 2011. She likewise reminded those who will prepare the year-end adjustments to consider RMC No. 27-2011.

For further assistance, you may visit RDO 08 at number 69 Leonard Wood Road, BIR Building, Baguio City, or call (074) 442- 2328, or rrr- 5518 or visit their website at www.bir.gov.ph for easy reference to the full text of the pertinent regulations on this matter.