BIR Ruling [UN-357-95]

October 3, 1995 BIR RULING [UN-357-95] Westmont Bank 411 Quintin Paredes St. Binondo, Manila Attention: Mr . Florido P . Casuela Executive Vice-President Gentlemen : This refers to your letter dated August 18, 1995 requesting in effect, for a ruling exempting you from the payment of the creditable expanded withholding tax imposed under Revenue Regulations No. 12-94 on the ground that you have incurred operational losses during the immediately preceding two (2) years (1993-1994). liblex Documents submitted show that in the Income Tax Return you filed for the years 1993 and 1994, it is indicated therein that you have incurred net losses in the amounts of P305,569,413.00 and P192,308,460.00 for the years 1993 and 1994, respectively. In reply, please be informed that under Section 4 (d) of Revenue Regulations No. 6-85 as amended by Revenue Regulations No. 12-94 implementing Section 50 (b) of the Tax Code, as amended, the withholding tax prescribed in these regulations shall not apply to income payments of a payee who suffered net operating losses during the immediately preceding two (2) years. Such being the case, and since you have incurred net operating losses for two (2) consecutive years from 1993 to 1994, this Office is of the opinion as it hereby holds, that you are exempt from the payment of the creditable expanded withholding tax prescribed under Revenue Regulations No. 12-94 for the year 1995. (BIR Ruling No. 126-94 dated August 19, 1994) This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. Very truly yours, ALICIA P. CLEMENO Assistant Commissioner (Legal Service) By: ALICIA L. TOMACRUZ Head Rev. Executive Assistant (Legal Service)