Generation of the Annual Top Individual and Corporate Income Taxpayers

January 19, 2000 REVENUE MEMORANDUM ORDER NO. 07-00 SUBJECT : Generation of the Annual Top Individual and Corporate Income Taxpayers TO : All Revenue Officials and Employees Concerned I. Objectives This Order is issued to: A. Generate accurate and reliable lists of the top individual and corporate taxpayers annually. B. Prescribe the criteria for the selection of top individual and corporate taxpayers. C. Define the roles and responsibilities of all offices involved in the preparation and generation of the top taxpayers lists. II. Policies and Guidelines A. Top taxpayers list/s shall be prepared yearly for the following: cdlex 1. Purely Compensation Income (BIR Form 1700) 2. Business Income (BIR Form 170 1 ) 3. Corporate Income (BIR Form 1702) cdll B. The selected groups enumerated below shall be the primary source(s) of taxpayer names for inclusion in the top taxpayers list/s: LexLib 1. All those classified as large taxpayers by the Large Taxpayers Service. 2. All those identified as excise taxpayers by the Excise Taxpayers Service. 3. Top taxpayers of the preceding year. Cdpr 4. Taxpayers identified/considered as potential top taxpayers by the Commissioner of Internal Revenue, Deputy Commissioner(s), Assistant Commissioner(s) and/or the Revenue District Officers. cdll 5. Executives/owners of top corporations in the Philippines. 6. Prominent/high-profile individuals (ex. sports personalities, those in the entertainment industry/mass media). 7. Government officials C. The Commissioner shall set the threshold (based on tax due) for the nationwide top taxpayers list/s - compensation, business and corporate. These shall be released not later than January 30 of each year. D. All RDOs, RDCs, Large Taxpayers Service (LTS) and the Excise Taxpayers Service (ETS) shall maintain their respective top taxpayers lists. E. Document processing shall be done at Revenue Data Centers (RDCs) for Revenue District Offices (RDOs) which are yet to be rolled out for RDO-based processing. Once rolled out, the concerned RDOs shall perform these activities. F. The ISOS shall provide the Office of the Commissioner through the Office of the Deputy Commissioner, Information Systems Group with the final and consolidated top taxpayers lists not later than August 30 of each year. G. All offices shall ensure the confidentiality, accuracy and reliability of their respective top taxpayers lists. llcd III. Procedures A. The Revenue District Office (RDO) shall: If computerized, 1. Establish and maintain a list of their potential top taxpayers. 2. Ensure that the special code field in the Registration System of the Integrated Tax System is properly tagged (e.g., GOVTO for government officials, PBAER for PBA players, POLIT for politicians).This will facilitate identification/extraction of particular types of taxpayers, as provided for in II.B of this RMO. 3. Screen and segregate annual ITRs belonging to taxpayers specified in II.B of this RMO. Make sure that the returns have data on income tax due and gross income, otherwise, contact taxpayer/s. prcd 4. Batch ITRs of potential top taxpayers separately according to form type. 5. Encode the tax returns. Ensure that income tax due and gross income are encoded correctly. 6. Provide ISOS with certified true copies of ITRs when requested. cdll If not yet computerized, 1. Follow the above procedures except III.A.2. 2. Encode the following taxpayer information using a spreadsheet application (e.g. Microsoft Excel): cdll a. RDO Code b. Complete Taxpayer s Name (Last Name, First Name, Middle Name) c. Taxpayer Identification Number d. Gross Income e. Income Tax Due cdlex 3. Prepare and submit to the Assistant Commissioner, ISOS, not later than July 1 of each year, the following: a. List of Top Individual Taxpayers (From Compensation) In <RDO> for the year <9999> with Tax Due Over <999999> b. List of Top Individual Taxpayers (From Business/Mixed Income) In <RDO> for the year <9999> With Tax Due Over <999999> c. List of Top Corporate Taxpayers In <RDO> for the year <9999> With Tax Due Over <999999> d. Soft copy of the above listings. B. The Large Taxpayers Service (LTS)/Excise Taxpayers Service (ETS)shall: 1. Process data from large/excise taxpayers . Ensure that income tax due and gross income are encoded correctly. 2. Provide ISOS with certified true copies of ITRs when requested. C. The Revenue Data Center shall: 1. Process data from individual and corporate ITRs. Segregate and batch separately individual and corporate ITRs of potential top taxpayers mentioned in II.B of this RMO. Note: The preceding procedure shall be undertaken for RDOs yet to be rolled out for RDO-based processing. 2. Ensure that processed data of potential individual and corporate top taxpayers mentioned in II.B of this RMO are uploaded to ITS database. 3. Provide ISOS with certified true copies of ITRs when requested. prcd D. Information Systems Operations Service D1. The Office of the Assistant Commissioner shall: 1. Ensure the timely processing and submission of top taxpayers lists. LibLex 2. Submit the final and consolidated top taxpayers lists to the Commissioner of Internal Revenue through the Deputy Commissioner, Information Systems Group not later than August 30 of each year. D2. The Legacy Systems, ISOS Shall: 1. Receive from Systems Operations Division (SOD), ISOS hard and soft copies of extracted data of potential top taxpayers from ITS database. 2. Validate the current lists against the previous lists of top taxpayers. 3. Receive from non-computerized RDOs the following: a. List of Top Individual Taxpayers (From Compensation) in <RDO/RDC> for the Year <9999> with Tax Due Over <999999> b. List of Top Individual Taxpayers (From Business/Mixed Income) in <RDO/RDC> for the Year <9999> with Tax Due Over <999999> c. List of Top Corporate Taxpayers in <RDO/RDC> for the Year <9999> with Tax Due Over <999999> d. Soft copy of the above listings cdll 4. Consolidate data received from the different offices. 5. Coordinate with concerned offices to resolve discrepancies or doubtful information. Request for certified true copies of the ITRs, if necessary. 6. Prepare and submit to the Assistant Commissioner, ISOS, not later than August 20 of each year, the following (Annexes A to D). a. Alpha List of Top <9999> Individual Taxpayers for the Year <9999> (From Compensation) (Annex A) cdlex b. Alpha List of Top <9999> Individual Taxpayers for the Year <9999> (From Business/Mixed Income) (Annex A) c. Alpha List of Top <9999> Corporate Taxpayers for the Year <9999> (Annex A) prcd d. List of Top <9999> Individual Taxpayers for the Year <9999> By Tax Due (From Compensation) (Annex B) e. List of Top <9999> Individual Taxpayers for the Year <9999> By Tax Due (From Business/Mixed Income) (Annex B) LexLib f. List of Top <9999> Corporate Taxpayers for the Year <9999> By Tax Due (Annex B) g. Comparative Data of Top Individual Taxpayers (From Compensation & Business/Mixed Income) By Alpha <Current Taxable Year> vs. <Previous Taxable Year> (Annex C) h. Comparative Data of Top Corporate Taxpayers prcd By Alpha <Current Taxable Year> vs. <Previous Taxable Year> (Annex C) i. Comparative Data of Top Individual Taxpayers (From Compensation & Business/Mixed Income) By Tax Due <.Current Taxable Year> vs. <Previous Taxable Year> (Annex D) cdll j. Comparative Data of Top Corporate Taxpayers By Tax Due <Current Taxable Year> vs. <Previous Taxable Year> (Annex D) D.3 The Systems Operations Division (SOD), ISOS shall: 1. Run a Script prepared by the Systems Maintenance and Support Division (SMSD), Information Systems Development Service (ISDS) to extract from the ITS database the following data for taxpayers specified in II.B of this RMO: llcd a. RDO Code b. Complete Name of Taxpayer (Last Name, First Name, Middle Name) c. Taxpayer Identification Number d. Gross Income e. Income Tax Due 2. Forward to Legacy Systems, ISOS the extracted data of potential individual and corporate top taxpayers together with the soft copies not later- than July 1 of each year. E. The Systems Standards & Technology Management Division (SSTMD), Information Planning & Quality Service (IPQS) shall: 1. Secure an updated list of government officials (executive, legislative and judiciary) and provide copies to ISOS, RDOs and RDCs not later than January 30 of each year. 2. Issue quarterly updates on the previously issued list of government officials if necessary. prcd F. The Systems Maintenance and Support Division, ISDS shall: 1. Write, and revise as needed, a script to extract annual top taxpayers details from the ITS. IV. Repealing Clause All other issuances and portions thereof inconsistent herewith are hereby repealed or amended accordingly. cdlex V. Effectivity This Order takes effect immediately. (SGD.) DAKILA B. FONACIER Commissioner of Internal Revenue ANNEX A ANNEX B ANNEX C ANNEX D