Deduction by National Investment and Devt. Corp. of Withholding Tax on Backwages Earned Abroad by Certain Crewmen

January 31, 1984 BIR RULING NO. 025-84 90-002-83-025-84 Gentlemen : This refers to your letter dated December 20, 1983 requesting a ruling as to whether the National Investment and Development Corporation (NIDC) should deduct withholding tax on backwages earned abroad by the crewmen of vessels formerly owned by Philippine International Shipping Corporation. In reply, please be informed that every employer or person who pays or who has the control, receipt, custody, disposal or payment of compensation paid to and received by citizens of the Philippines for services performed outside of the country irrespective of the number of days of such service during the calendar year shall deduct and withhold income tax due thereon in accordance with Section 7(II)(b)(1) of Revenue Regulations No. 6-82 dated October 1, 1982 implementing Section 21(f) of the Tax Code as amended by B.P. Blg. 135. In view thereof, NIDC is required to withhold the corresponding tax on such backwages in accordance with Section 21(f) of the Tax Code as implemented by Revenue Regulations No. 6-82 supra . adc Very truly yours, (SGD.) RUBEN B. ANCHETA Acting Commissioner