Overpayment of Income Tax Refundable

May 3, 1993 BIR RULING NO. 169-93 OVERPAYMENT OF INCOME TAX REFUNDABLE 29 (L) 000-00 169-93 Confederation of Filipino Workers Suite 303, Third Floor, Aric Building 1845 Taft Avenue Malate, Manila Attention: Mr . Gerardo F . Rosana Union President This refers to your letter dated 29 October, 1992, requesting in effect, a ruling as to whether you are entitled to an immediate refund from your employer for the overpayment of income tax for the taxable year 1991 pursuant to Revenue Memorandum Order No. 32-92 dated August 7, 1992. aisadc It appears that your employer, Aris Philippines, Inc., is an export-oriented corporation operating under the laws of the Republic of the Philippines; that instead of refunding the overpayment of individual income tax for the taxable year 1991, pursuant to Revenue Memorandum Order No. 32-92, your employer opted to credit the said refundable amounts to next year's income tax returns. In reply, please be informed that pursuant to Revenue Memorandum Order No. 32-92 III (A) (4), viz: "(A) Allow credit for adjusted refundable amount (excess of taxes withheld over the adjusted tax due and tax paid in 1991) against the tax required to be withheld from the compensation of the employee beginning September 1992 and the succeeding months; "(B) If employee has no tax due to be withheld for 1992 (employee becomes exempt under the new exemptions) refund adjusted refundable amount (excess of taxes withheld over adjusted tax due and tax paid in 1991) to employee immediately but not later than January 10, 1993. In turn, the total amount, actually refunded by the employer to the employee, shall be repaid from the remittable amount of taxes withheld for the current month in which refund was made and in succeeding months until the overwithheld tax is fully paid." Such being the case, the overpayment of income tax for the year 1991 should be immediately refunded by Aris Philippines to its employees provided that, after computing the year-end adjustment, said employees have no tax due to be withheld for 1992, because they became exempt under the new exemptions. cd VICTOR A. DEOFERIO, JR. Deputy Commissioner of Internal Revenue