Withholding Tax on RATA Prior to January 1, 1991 Shall Not be Refunded

January 9, 1992 BIR RULING NO. 013-92 21 (a) 165-91 013-92 Tariff Commission 5th Floor, PHC Building East Avenue, Quezon City Attention: Ms . Chulia J . Azarcon Gentlemen : This refers to your letter dated August 28, 1991 requesting that BIR Ruling No. 21(a) 000-00 062-91 dated April 15, 1991 holding that RATA is not subject to withholding tax be made retroactive to July 31, 1986. In reply, please be informed that the aforementioned ruling was issued after the Secretary of Budget and Management confirmed in a letter dated March 8, 1991 that RATA is in fact a reimbursement for the expenses incurred in the performance of one's duties rather than as an additional compensation and therefore is not subject to withholding tax. Such being the case, it cannot be given a retroactive application, but shall instead be applicable only to payments/receipts beginning taxable year 1991. However, any amount of tax withheld from RATA received by qualified officials and employees from January 1991 shall not be refunded, but shall be credited against their income tax due when the annualized withholding tax is determined as of the year end 1991. In view of the foregoing, you cannot therefore avail of any tax credit or refund of withholding tax on RATA prior to January 1, 1991. cdta Very truly yours, (SGD.) JOSE U. ONG Commissioner of Internal Revenue