7 RR No. 14-2008 PDF
7 RR No. 14-2008 PDF
DEPARTMENT OF FINANCE
BUREAU OF INTERNAL REVENUE
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Sec. 2.57.2. Income payment subject to creditable withholding tax and rates
prescribed thereon. Except as herein otherwise provided, there shall be withheld a
creditable income tax at the rates herein specified for each class of payee from the
following items of income payments to persons residing in the Philippines.
x x x xxx xxx
(M) Income payments made by the top twenty thousand (20,000) private
corporations to their local/resident supplier of goods and local/resident supplier of
services other than those covered by other rates of withholding tax. Income payments
made by any of the top twenty thousand (20,000) private corporations, as determined
by the Commissioner, to their local/resident supplier of goods and local/resident supplier
of services, including non-resident alien engaged in trade or business in the Philippines
(a) Classified and duly notified by the Commissioner as a large taxpayer under
Revenue Regulations No. 1-98, as amended, or belonging to the top five
thousand (5,000) private corporations under RR 12-94, or to the top ten
thousand (10,000) private corporations under RR 17-2003, unless
previously de-classified as such or had already ceased business
operations (automatic inclusion);
(b) Any taxpayer with net VAT paid or payable for the preceding year of at least
P100,000;
(c) Any taxpayer with annual income tax paid or payable for the preceding year
of at least P200,000;
(d) Any taxpayer with percentage taxes for the preceding year of at least
P100,000;
(e) Any taxpayer whose gross sales for the preceding year is over P10,000,000;
(f) Any taxpayer whose gross purchases for the preceding year is over
P5,000,000.
The term goods pertains to tangible personal property. It does not include
intangible personal property, as well as real property.
Any corporation which has been duly classified and notified as large taxpayer
by the Commissioner pursuant to RR 1-98, as amended, shall be automatically
considered one of the top twenty thousand (20,000) private corporations, provided,
however, that its authority as a withholding agent shall be effective only upon receipt of
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written notice from the Commissioner that it has been classified as a large taxpayer, as
well as one of the top twenty thousand (20,000) private corporations, for purposes of
these regulations.
The withholding agent shall submit on a semestral basis a list of its regular
suppliers of goods and/or services to the Large Taxpayers Assistance Division/Large
Taxpayers District Office in the case of large taxpayers duly notified as such pursuant to
RR 1-98, as amended, or Revenue District Office (RDO) having jurisdiction over the
withholding agents principal place of business on or before July 31 and January 31 of
each year.
All taxpayers previously included in the list of top 5,000 private corporations
under RR 12-94, as amended, and those who qualified as top ten thousand (10,000)
private corporations under RR 17-2003 shall continue to withhold one percent (1%)
for supplier of goods and 2% for supplier of services upon the effectivity of these
Regulations, unless any of the following situations occur: (a) the Commissioner
communicates in writing that they have ceased to qualify as taxpayers includible in the
list of top twenty thousand (20,000) private corporations, or (b) those officially
identified to have ceased business operations, or undergone any of the business
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combinations wherein by operation of law the juridical personality of said taxpayers
ceased.
SEC. 4. EFFECTIVITY These regulations shall take effect fifteen (15) days
following publication in a newspaper of general circulation.
(Original Signed)
MARGARITO B. TEVES
Secretary of Finance
RECOMMENDING APPROVAL:
(Original Signed)
SIXTO S. ESQUIVIAS IV
Commissioner of Internal Revenue