BIR Ruling

January 23, 1973 Makati Stock Exchange, Inc. Makati Stock Exchange Bldg. Ayala Avenue, Makati, Rizal Gentlemen : With reference to your letter dated November 22, 1972, I have the honor to inform you as follows: cdta The "investment in capital stocks of preferred productive enterprise" requirement of Presidential Decree No. 16, as amended by Presidential Decree No. 16-A, includes only direct equity investment in shares of capital stock, whether in original or additional issues. Hence, outstanding shares listed and marketed in stock markets are not included in Section 4 of Revenue Regulations No. 7A-72. The holding period of 3 years prescribed for the investment applies for the entire duration thereof in only one investment category. The carry over of any unexpired portion thereof to another investment category is not allowed. Individuals and duly registered general copartnerships are not yet required to file quarterly returns. For purposes of the quarterly return, a special and distinct form had been devised for the use in connection therewith denominated BIR Form No. 1702-Q. A quarterly return is not required to be audited. A return is not required for the fourth quarter. The excess of the aggregate of the quarterly taxes paid over the tax due for the taxable year shown on the adjustment return shall be credited or refunded to the corporation. There is no occasion for the off-setting of losses for the later quarters against profits for the previous quarters. The corporation's actual income shall be computed just the same on the basis of the entire taxable year's gross income less all deductions allowable and, as stated in the next preceding paragraph, the excess of the aggregate of the quarterly taxes paid over the tax due for the taxable year shall be refunded or credited. On the other hand, the excess of the tax computed on the basis of the adjustment return over the aggregate of the quarterly taxes paid will have to be paid on the date for filing of the adjustment return (BIR Form 1702). For the year 1972, the taxpayer is allow to file only one return for three quarters, pursuant to Section 5(b) of Revenue Regulations No. 12-72, dated December 1, 1972, although payments may be made on the dates scheduled in the aforesaid regulation, a copy of which is attached. There is no instance where the filing of the quarterly returns may be extended. Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue