BIR Ruling No. 314-82

November 29, 1982 BIR RULING NO. 314-82 53-f 000-00 314-82 Filway Marketing, Inc. Box 2308, MICCPO Makati, Metro Manila Attention: Mr . Hector O . Tagaysay President Gentlemen : This refers to your letter dated November 24, 1982 requesting a ruling as to whether or not remunerations you pay to your encyclopedia salesmen are subject to the Expanded Withholding Tax. cd It is represented that your encyclopedia salesmen are not paid fixed salaries; that their compensation/remuneration is purely commission determined on the basis of individual sales; that they are not required to follow certain fixed hours of work and that they are not even required to report to your office on a regular basis; that they report to your office only when they have some specific business to transact or attend to; and that they sell your encyclopedias at the time they find it convenient based on their personal schedules; and that said salesmen are commercial brokers and not employees of your company. In reply, I have the honor to inform you that under Revenue Regulations No. 13-78, as amended by Revenue Regulations No. 6-79 otherwise known as Expanded Withholding Tax Regulations, implementing Presidential Decree No. 1351, now Section 53(f) of the Tax Code, only payments to persons enumerated therein are subject to withholding tax. Consequently, income payments due to said salesmen who are commercial brokers not being among those specified in said regulations, are not subject to the expanded withholding tax. However, the commissions received by such salesmen are subject to income tax under Section 21 (b) of the Tax Code, as amended. Moreover, since the aforesaid income payments are not subject to withholding, you shall render an information return on such payments, pursuant to Section 77 of the Tax Code as amended by Batas Pambansa Blg. 135 and as implemented by Section 21 of Revenue Regulations No. 1-82 dated March 18, 1982. Very truly yours, RUBEN B. ANCHETA Acting Commissioner