Gross Payments Consisting of Commissions Made to Individual Collection Agents are Not Subject to 1% Expanded Withholding Tax

August 3, 1987 BIR RULING NO. 225-87 51 (f) 000-00 225-87 S i r : This refers to your letter dated February 19, 1987 requesting exemption from the payment of the 1% expanded withholding tax. It is represented that you are called a "collection agent" in the sense that you collect the accounts of Singer Sewing Machine Company; that you are connected with any collection agency; and that you operate as an individual collector, non-salaried and merely earning commissions on the basis of what is collected. In reply, I have the honor to inform you that under Revenue Regulations No. 6-85 otherwise known as the Revised and Consolidated Expanded Withholding Tax Regulations implementing Section 51(f) of the Tax Code, only income payments to persons enumerated therein are subject to the expanded withholding tax. Accordingly, since individual collection agents like you are not among those enumerated in said regulations, gross payments consisting of commissions made to you by the Singer Machine Company are not subject to the said 1% expanded withholding tax. aisadc Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner