Change of Tax Status from Withholding Agent to Non-withholding Agent

December 19, 2001 BIR RULING NO. 058-01 58, 81 000-00 TFS Pawnshop, Inc. 878 F. Aurora Boulevard Cubao, Quezon City Attention: Mr . Antonio Ramon R . Ongsiako President Gentlemen : This refers to your letter dated October 26, 1999 requesting that you be allowed to update all your branches' BIR registration relative to change of tax status from withholding agents to non-withholding agents. It is represented that the head office of TFS Pawnshop, Inc . (TFS) is located at 878 F. Aurora Boulevard, Cubao, Quezon City; that all its branches nationwide have a centralized withholding and remittance of withholding taxes both on compensation and expanded withholding taxes to RDO No. 40 through its accredited bank, Westmont Bank-McArthur Branch; that TFS' head office is the only withholding agent and its branches are not; and that TFS is updating all its branches' BIR registration regarding their tax status. In reply, please be informed that Section 58 and 81 both the Tax Code of 1997 provide: "SEC. 58. Returns and Payment of Taxes Withheld at Source . "(A) Quarterly Returns and Payments of Taxes Withheld . Taxes deducted and withheld under Section 57 by withholding agents shall be covered by a return and paid to, except in cases where the Commissioner otherwise permits, an authorized agent bank, Revenue District Office, Collection Agent, or duly authorized Treasurer of the city or municipality where the withholding agent has his legal residence or principal business, or where the withholding agent is a corporation, where the principal office is located. . . . "SEC. 81. Filing of Return and Payment of Taxes Withheld . Except as the Commissioner otherwise permits, taxes deducted and withheld by the employer on wages of employees shall be covered by a return and paid to an authorized agent bank, Collection Agent, or duly authorized Treasurer of the city of municipality where the employer has his legal residence or principal business, or in case the employer is a corporation, where the principal office is located. . . ." In view of the foregoing, this Office grants your requests to update all your branches' BIR Registration relative to change of tax status from withholding agents to non-withholding agents, the same being in accordance with the aforequoted provisions. Such being the case, compensation income and expanded withholding taxes by TFS as well as its different branches shall be remitted/paid to Revenue District Office No. 40, Cubao where its principal office is located. cITaCS This rule is being issued on the basis of the foregoing fact as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. Very truly yours, (SGD.) RENE G. BAEZ Commissioner of Internal Revenue