BIR Ruling [UN-120-94]

April 4, 1994 BIR RULING [UN-120-94] Product Development and Design Center of the Philippines Department of Trade and Industry Cultural Center Complex Roxas Boulevard, Manila Attention: Mr . Jose O . Panelo Chief Accountant Gentlemen : This refers to your protest involving the various pre-assessment notices dated July 22, 1992 regarding penalties for late remittance of withholding taxes for the year 1990. Records of the case disclosed that you were not able to remit the taxes you withheld from your employees for 1990 due to the closing of your books of account and the transfer and resignation of your Accounting personnel; that when you were able to hire new replacements, the said employees, however, were so unfamiliar with the work that they failed to remit the taxes you withheld on time; that lately, you have improved your remittance scheme, such that the tax deduction for the month involved are now remitted on time. You are therefore requesting that the penalties for late remittance of the said taxes you withheld in 1990 be condoned since you are currently trying every means to remit in advance, viz: Date of Pre-Assessment Pre-Assessment Notice Notice Number Amount July 22, 1992 B# 2W-3-001 P80,993.16 July 22, 1992 B# 2W-3-002 218,469.16 July 22, 1992 B# 2W-3-003 564,690.91 July 22, 1992 B# 2W-3-004 241,485.53 July 22, 1992 B# 2W-3-005 513,375.90 July 22, 1992 B# 2W-3-006 58,928.51 In reply thereto, please be informed that pursuant to Section 74 of the Tax Code, as amended, all taxes deducted and withheld by the employer shall be filed and the payment made within 25 days from the close of each calendar quarter. The taxes deducted and withheld by employers shall be held as a special fund in trust for the Government until the same are paid to the said collecting officers. In view of the foregoing provision and since you only intended to remit the payment of the taxes you withheld from your employees in the taxable year 1990 not until after you received several pre-assessment notices from the Bureau on July 22, 1992, we believe that there had been no sincere attempt on your part to remit the said withholding taxes to this Office. Hence, your protest has to be, as it is hereby DENIED FOR LACK OF LEGAL BASIS. You are, therefore, requested to remit and settle the aforementioned pre-assessment notices covering your deficiency withholding taxes, including the increments, for the year 1990. cdtech This constitutes the final decision of this Office on the matter. Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue