Claim for Refund for Alleged Overpayment of Income Tax Due to RATA Has No Legal Basis

December 28, 1993 BIR RULING NO. 537-93 CLAIM FOR REFUND FOR ALLEGED OVERPAYMENT OF INCOME TAX DUE TO RATA HAS NO LEGAL BASIS 21 146-92 537-93 Mr. Glicerio E. Esla Municipal Telephone Projects Office 16th Floor Philcomsen Building Ortigas Avenue, Pasig, Metro Manila This refers to your letter dated June 17, 1992 requesting for refund of the excess income tax paid for taxable years 1985 to 1989 representing overpayment of income tax resulting from the inclusion of RATA in the computation of income tax. In reply, please be informed that this Office has issued Revenue Memorandum Circular No. 60-91 dated July 9, 1991 clarifying that BIR Ruling No. 21(a) 000-00-062-91 dated November 6, 1991 holding that RATA is in fact a reimbursement for the expenses incurred in the performance of one's duties rather than as an additional compensation and therefore is not compensation subject to withholding tax, shall be applicable beginning taxable year 1991. Any amount of tax withheld from RATA received by qualified officials and employees from January, 1991 shall not be refunded, but shall be credited against their income tax due when the annualized withholding tax is determined as of the year end of 1991. Based on the foregoing, your request for refund of an alleged overpayment of income tax from 1985 to 1989 has to be denied, as it is hereby denied for lack of legal basis. LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue