BIR Ruling No. 255-82

October 12, 1982 BIR RULING NO. 255-82 53-f 203-82 255-82 Builders and Heavy Equipment Services Corporation General Contractors and Builders 1477 Narra St., Manila Attention: Mr . Roberto N . Rivera Accountant Gentlemen : This refers to your letter dated August 31, 1982 requesting a ruling as to whether the service fee which you will receive from Taurus Resources and Manpower International (Taurus) is subject to the expanded withholding tax. It is represented that Taurus entered into a Joint Venture Agreement with you for the hiring and recruitment of construction workers for overseas employment; that under the agreement you undertake the processing and follow-ups of contracts and passports of the workers; and that you are being paid service fee by Taurus. In reply, please be informed that pursuant to Revenue Regulations No. 13-78, as amended by Revenue Regulations No. 6-79, implementing Section 53(f) of the Tax Code, as amended by Presidential Decree No. 1351, only income payments to persons enumerated therein are subject to withholding tax. Accordingly, and since service companies are not among those enumerated in said regulations, the payments made by Taurus for your services are not subject to the expanded withholding tax. aisadc However, you are considered an independent contractor subject to the P100.00 fixed annual tax and to the 3% contractor's tax under Sections 192(1) and 205(16) both of the Tax Code, as amended. Pursuant to Section 24(a) of the same Code, as amended, you are also subject to the corporate income tax on your taxable net income received during each taxable year from all sources. Very truly yours, RUBEN B. ANCHETA Acting Commissioner