Better Late Than Never: Even With a Pending BIR Investigation, Taxpayers May Still Remit Withholding Taxes
Better Late Than Never: Even With a Pending BIR Investigation, Taxpayers May Still Remit Withholding Taxes Early this year, the BIR, thru Revenue Regulations No. (“RR”) 6-2018, reinstated the possibility for taxpayers to belatedly remit the expanded withholding tax (“EWT”) withheld during the period being investigated from income payments made to professionals, contractors, and other recipients whose income is subject to withholding, even when there is already a Letter of Authority or even during reinvestigation. Under the Tax Code, an income payment, which is otherwise deductible, shall be allowed as a deduction from the payor's gross income only if it is shown that the income tax required to be withheld has been paid. Thus, it has always been the practice during audit investigations by the BIR, where there are expenses found not to have bee subjected to withholding taxes, that the taxpayer is allowed to belatedly remit to the BIR the taxes withheld from the said income...
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