BIR Ruling [DA-158-99]

March 16, 1999 BIR RULING [DA-158-99] Laya Mananghaya & Co. 22/F Antel 1000 Center 139 Valero Street, Salcedo Village Makati City Attention: Atty . Mariano C . Ereso Principal/Head-Tax Consulting Gentlemen : This refers to your letter dated March 8, 1999 requesting authority for your client, Apo Cement Corporation, to change its accounting period from fiscal year ending September 30 to calendar year ending December 31, effective January 1, 1999. LLcd In reply, please be informed that your request is hereby granted, provided, you comply with the provisions of sections 46 and 47 of the Tax Code of 1997 which states: "SEC. 46. Change of Accounting Period . If a taxpayer, other than an individual, changes his accounting period from fiscal year to calendar year, from calendar year to fiscal year, or from one fiscal year to another, the net income shall, with the approval of the Commissioner, be computed on the basis of such new account period, subject to the provisions of Section 47. "SEC. 47. Final or Adjustment Returns for a Period of Less than Twelve (12) Months . "(A) Returns for Short Period Resulting from Change of Accounting Period . If a taxpayer other than an individual, with the approval of the Commissioner, changes the basis of computing net income from fiscal year to calendar year, a separate final or adjustment return shall be made for the period between the close of the last fiscal year for which return was made and the following December 31. If the change is from calendar year to fiscal year, a separate final return or adjustment return shall be made for the period between the close of the last calendar year for which return was made and the date designated as the close of the fiscal year. If the change is from one fiscal year to another fiscal year, a separate final or adjustment return shall be made for the period between the close of the former fiscal year and the date designated as the close of the new fiscal year. "(B) Income Computed on Basis of Short Period . Where a separate final or adjustment return is made under Subsection (A) on account of a change in the accounting period, and in all other cases where a separate final or adjustment return is required or permitted by rules and regulations prescribed by the Secretary of Finance, upon recommendation of the Commissioner, to be made for a fractional part of a year, then the income shall be computed on the basis of the period for which separate or final adjustment return is made. Accordingly, Apo Cement Corporation should file on or before April 15, 1999 a separate final or adjustment return for the period corresponding to October 1 and December 31, 1998, which is a period between the close of the fiscal year for which a return was made and the date designated as the close of the calendar year. This will serve as your authority to change your accounting period from fiscal year to calendar year upon your compliance with the requirement of filing a short period return. (BIR Ruling 060-96 dated 22 May 1996). LLphil Very truly yours, Commissioner of Internal Revenue By: (SGD.) SIXTO S. ESQUIVIAS IV Deputy Commissioner (Legal and Enforcement Group)