BIR Ruling No. 091-65

August 12, 1965 BIR RULING NO. 091-65 Muller & Phipps (Manila) Ltd. Corner Pioneer and Reliance Sts. Mandaluyong, Rizal Attention : Mr . C . B . Enriquez Secretary Gentlemen : Reference is made to your letter dated December 10, 1964 stating the following: cdt "1) Transportation allowances, fixed in amounts, are granted to some key employees in lieu of providing them with Company cars. These allowances are paid to the employees either by separate payments or by specifically indicating the separate amounts when both wages and the transportation allowances are combined in a single payment. The employees receiving the fixed transportation do not render statements to account for the allowances. However, the nature of their positions and work is such that expenses for which the allowances are given are unavoidably incurred. "2) Per diems are granted to our salesmen, sales supervisors, and field auditors. These allowances, although fixed in amounts, are intended to pay for the board and lodging of the employees while traveling. The employees are not required to render statements showing how much they spent for board and lodging. The amounts of per diem allowed to them are set on the basis of prevailing rates of hotel accommodations and meals at restaurants. These per diems are intended to reimburse the employees for their traveling expenses and not as an additional compensation. You now request a ruling on whether or not said transportation allowances and per diems constitute wages subject to withholding tax. In reply thereto, I have the honor to inform you that the above-mentioned per diems and fixed transportation allowances are considered part of the total wages of the employees concerned and should, therefore, be considered wages for purposes of the withholding tax. Very truly yours, (SGD.) BENJAMIN N. TABIOS Acting Commissioner of Internal Revenue