BIR Ruling [UN-056-A-95]

February 8, 1995 BIR RULING [UN-056-A-95] National Center For Mental Health Mandaluyong, Metro Manila Attention: Ms . Cora C . Solis Chief, Acctg . Division Gentlemen : This refers to the internal revenue tax case of the National Center For Mental Health, Mandaluyong, Metro Manila, involving the total amount of P47,541.43 under Assessment Notice Nos. 7.50A 0024 89-92, 7.50A 0025 89-92, 7.50A 0035 89-92 all dated June 17, 1992 and Assessment Notice No. 7.50A 0054 89-92 dated July 3, 1992 for underwithholding and late remittance of withholding tax on compensation income and expanded withholding taxes for the year 1989. In a letter dated July 13, 1992, you alleged that you are always encountering problems regarding the replenishment of your disbursements, which in turn affect your remittances; and that the discrepancies might have been committed because of your alleged lack of information and/or prescribed instructions. cdtech In connection therewith, you are requesting for a condonation of your aforesaid tax liabilities. In reply thereto, please be informed that your request cannot be granted for lack of legal basis. Pursuant to Section 2 of Revenue Regulations No. 5-85, taxes deducted and withheld on compensation income shall be remitted within ten (10) days after the end of each calendar month with the filing of the appropriate returns. Moreover, taxes deducted and withheld by the withholding agent shall be held as a special fund in trust for the Government until paid to the collecting officers. (Sec. 51, Tax Code, as amended). The imposition of surcharge and interest is but a just compensation to the state for the delay in paying the tax and for the concomitant use by the taxpayer of funds that rightfully should be in the hands of the government. (Central Azucarera Don Pedro V. Court of Tax Appeals, 20 SCRA 345; Castro vs. Collector of Internal Revenue, 6 SCRA 886). In view of the foregoing, you are requested to pay the total amount of P47,541.43 for underwithholding and late remittance of withholding tax on compensation and expanded withholding tax within ten (10) days from receipt hereof otherwise this Office will enforce collection thereof through the summary remedies prescribed by law. cd This constitutes the final decision of this Office on the matter. Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue