BIR Ruling No. 060-62

March 12, 1962 BIR RULING NO. 060-62 The Commissioner Tariff Commission M a n i l a S i r : This is in reply to your request for a ruling on the following query: "Republic Act No. 2343 has increased the individual income tax exemption for dependents from P600 to P1000 each dependent. Information is requested as to whether a corresponding reduction can be made in the withholding tax of employees of this Office who are affected and, if so, whether over-payments made in the past months of the year can be applied to the adjusted withholding tax due during the remaining months of the year." Because of the passage of Republic Act No. 2343 which increased, among other things the individual's additional exemptions for certain dependents from P600 to P1,000, proper adjustments on the withholding of taxes should be made by the employer. cdtech Accordingly, if more than the correct amount of tax is deducted from any wage payment in any quarter, before remittance is made to the Government, the over collection may be repaid to the employee. Reimbursement is a matter for settlement between the employer and employee. The employer shall, however, obtain and keep as part of his records a written receipt of the employees showing the date and amount of the repayment. Every over collection not repaid and receipted for by the employee must be reported and paid to the Commissioner of Internal Revenue with the return for the quarter in which the over collection was made. Moreover, any excess of the withheld at source over the tax ascertained to be due on the income tax return upon office audit in the Bureau of Internal Revenue, shall be refunded or credited, at his option, to the recipient of the income. Credits and refunds of amounts of taxes withheld by the employer and paid over to the government are matters to be settled between the Bureau of Internal Revenue and the employee claiming a tax refund or tax credit, as the case may be. cd Very truly yours, MELECIO R. DOMINGO Commissioner of Internal Revenue