Prescribing the Revised Procedures in the Processing of Batch Control Sheet (BCS) Reports/Returns Received from Accredited Agent Banks/Office of Collection Officers Including Decentralization of Preparation of the List of Stop-Filers/Non-Filers and Reminder Letters

March 4, 1992 REVENUE MEMORANDUM ORDER NO. 16-92 SUBJECT : Prescribing the Revised Procedures in the Processing of Batch Control Sheet (BCS) Reports/Returns Received from Accredited Agent Banks/Office of Collection Officers Including Decentralization of Preparation of the List of Stop-Filers/Non-Filers and Reminder Letters TO : All Revenue District Officers, Revenue/RISSI Officials, Employees and Others Concerned I. OBJECTIVES: This Order is issued to: A. Prescribe procedures to revise certain portions of Revenue Memorandum Order No. 29-91 dated September 11, 1991, specifically the delineation of functions of RDO, RISSI, PO/CR Monitoring, VAT, Withholding Tax, Management Information and Data Control Systems Divisions; B. Achieve a well coordinated and accurate report on stop-filers/non-filers through decentralization; C. Provide more effective control and efficient systems and procedures for the receiving, handling and processing of BCS and other NPCS reports; D. Prescribe a single form of reminder letter for non-filers/stop-filers. II. HIGHLIGHTS OF UPDATED PROCEDURES: A. The Revenue District Officer (RDO) shall stamp "RECEIVED" and initial copies of BCS reports picked up/received from various accredited bank branches/Office of Collection Officers and indicate date of receipt. B. The RDO shall prepare monthly List of Stop-Filers/Non-Filers by Type of Tax (Annex A) which shall establish the RDOs stop-filers/non-filers to serve as basis for the issuance of Reminder Letters. C. The RDOs shall forward their List of Stop-Filers/Non-Filers for VAT filers and withholding tax agents to VAT/Withholding Tax Division, as the case may be, and for other tax filers to Management Information and Data Control Systems Division (MIDCSD), for monitoring purposes. D. RISSI shall also generate the List of Stop-Filers/Non-Filers by Type of Tax. Said list shall be transmitted to VAT/Withholding Tax Division, as the case may be, while the list covering other types of taxes shall be transmitted to MIDCSD. E. For purposes of simplification, a single form of reminder letter is hereby prescribed (Annex B). The RDO shall fill up the blank spaces for the appropriate kind of tax, period covered and other information. F. The RDO shall attach triplicate copies of ATAPs to their corresponding dockets. III. PROCEDURES: The Offices involved in the receipt and processing of tax returns paid thru NPCS are enumerated hereunder with their corresponding functions and responsibilities: A. REVENUE DISTRICT OFFICE 1. Pick up/receive daily the triplicate copies of tax returns/ATAPs with attached duplicate copies of BCS from accredited bank branches/Office of Collection Officers; 2. Stamp "RECEIVED" and initial copies of BCS reports from various accredited banks/Office of Collection Officers and indicate therein the date of receipt; 3. Maintain for each bank branch/Office of Collection Officer, a Register of BCS reports received showing the date of receipt and BCS number; 4. Check the completeness and correctness of the reports/documents received; Note: Complete/correct reports must conform with the following requirements: aisa dc a. Triplicate copies of the returns have complete information on the space provided for TINs or a notation that TIN is still in process and signed by the RDO or his authorized representative; b. The returns are machine validated, if there are payments made; c. BCS-reports bear the required data such as: - name and address of the bank - bank code number - BCS number - date of collection - date of preparation d. All taxpayers listed on the BCS reports have corresponding tax returns/ATAPs; e. Reports submitted are signed 5. Prepare monthly in three (3) copies the corresponding NPCS Exception Report in the prescribed format (Annex C) of this memorandum for discrepancies found in the report; forward the same to the following offices concerned not later than the 25th day of the following month for reports/returns received in the preceding month; Original - PO/CR Monitoring Division Duplicate - BHO (thru PO/CR Monitoring Division) Triplicate - file copy 6. Prepare two copies of monthly List of Stop-Filers/Non-Filers by type of tax based on the TIN Master, by Type of Tax furnished by RISSI, to establish the RDOs' stop-filers/non-filers who shall be issued Reminder Letters; aisa dc 7. Prepare in three (3) copies Reminder Letter/s (Annex B) to taxpayer/s to be distributed as follows: Original - taxpayer Duplicate - RDO file copy Triplicate - taxpayer (as follow-up letter) 8. Deliver personally to stop/non-filer(s) the original copy of the reminder letter(s); mail the triplicate copy fifteen (15) days after the taxpayer failed to respond to the original copy of the letter; retain duplicate copy for file; 9. Conduct inquiry with the bank branch concerned in case taxpayer shows proof/evidence of tax return filed; report to PO/CR Monitoring Division the non-transmittal/reporting of tax return filed in case the tax return presented by the taxpayer is authentic, otherwise, conduct investigation of the taxpayer; 10. Conduct verification of stop/non-filers who did not respond to the reminder letters sent; 11. Prepare report addressed to RISSI on taxpayers who stopped filing due to closure of business as discovered during verification stage; furnish a duplicate copy of the same to VAT/Withholding Tax/MIDCS Division, as the case may be; 12. Prepare report to Tax Fraud Evaluation Committee on tax evaders discovered during the verification of stop/non-filers; furnish a duplicate copy of the same to VAT/Withholding Tax MIDCS Division, as the case may be; 13. Update the List of Stop-Filers/Non-Filers and the TIN Master based on the results of the previous steps made; furnish the VAT/Withholding Tax/MIDCS Division, as the case may be, with a copy of the updated original List of Stop-Filers/Non-Filers; retain duplicate copy for file; 14. Prepare the required collection report (BIR Form No. 12.09) based on the documents received and as prescribed under Revenue Memorandum Order No. 4-90 dated January 15, 1990 and clarified by RMO No. 42-90 dated July 25, 1990; 15. Segregate out-of-district tax returns; 16. Prepare transmittal list for out-of-district tax returns/ATAPs received during the week indicating therein the bank branch code and the BCS number of the batch where the tax returns were taken; attach therein the copies of out-of-district tax returns/ATAP Issuing Office not later than three (3) days upon receipt of the tax returns/ATAPs; cd 17. Transmit out-of-district 1701C returns to the following offices, not later than three (3) days upon receipt of said returns: a) 1701C returns of taxpayers with local addresses - to the respective RDO having jurisdiction over said taxpayers. b) 1701C returns of taxpayers with foreign addresses - to International Tax Affairs Division (ITAD). 18. Segregate ATAPs from the tax returns and attach said ATAPs to their corresponding tax dockets; 19. Classify tax returns and number the Income Tax Returns in accordance with RMO Nos. 9-91 and 10-91; number other tax returns in the following manner: Bank Branch Code - BCS Number 20. Segregate according to type of tax return (BIR Form Nos. 1701, 1701A, 1701C, 1704, 1702, 1702Q, 1702A-1, 2550, 1743-W, 1745, 750A and 2529A-Q) and prepare in four (4) copies "Monthly Summary of Tax Returns Filed" in the amended format, (Annex G) of this memorandum and distribute to the following offices not later than 20 days from the receipt of tax returns: cd Original - Statistic Analysis Division Duplicate - RISSI Triplicate - Office of Regional Director/SOS Quadruplicate - Preparing Office 21. Maintain a complete and systematic file of the duplicate copies of BCS reports by bank branch/Office of Collection Officer and by BCS Number; 22. Distribute all returns for audit/investigation in accordance with the existing procedures. B. RISSI 1. Receive bundles/batches of original copies of tax returns/ATAPs with their corresponding copies of BCS-As and BCS-Bs from the PO/CR Monitoring Division/RDO; 2. Check the completeness and correctness of the reports/returns received; Note: Complete/correct reports/returns must conform with the following requirements: a. Original copies of the returns have stick-on labels (TINs) or a notation that TIN is still in process and signed by the RDO or his authorized representative; b. The returns are machine validated, if there are payments made; c. BCS reports bear all the required data; d. All taxpayers listed on the BCS reports have corresponding tax returns/ATAPs; and e. Reports submitted are signed. 3. Prepare in three (3) copies NPCS Exception Report (Annex C) based on the discrepancies or inconsistencies noted in the documents; 4. Forward exception reports not later than the 25th day of the following month for reports/returns received in the preceding months to the following offices: cdt Original - PO/CR Monitoring Div. Duplicate - BHO (thru PO/CR Monitoring Div.) Triplicate - RISSI, file copy 5. Encode data from the tax returns/ATAPs and BCS reports; 6. Generate computer totals of the different batches of tax returns and match them with their respective BCS-A totals; note any discrepancy discovered; 7. Generate the following and distribute to the offices concerned not later than the 25th day of the following month for returns received in the preceding month: a) Batch Discrepancy Report (Annex D) - Processing Section, Revenue Acctg. Div. b) Bank Collection Control Ledger (Annex E) - PO/CR Monitoring Division c) List of Late Batches (Annex F) - PO/CR Monitoring Division 8. Generate the following and forward to the offices concerned; copy furnish the Collection Service and/or Collection Branch: a) Monthly Alpha List of Tax Filers by Type of Tax (containing the name of drawee bank, check number, and the amount paid by the taxpayer) (1) by revenue regions - Regional Offices concerned (2) by city/municipality - Revenue District Office concerned (3) listing of non-resident citizens foreign countries - RDO concerned b) Statistical data required by the Statistical Analysis Division 9. Generate a copy of the monthly alphabetical List of Stop-Filers/Non-Filers (Annex A) by type of tax covered and by RDO using the previous filer's records; 10. Forward the List of Stop-Filers/Non-Filers covering VAT and Withholding Tax returns to VAT and Withholding Tax Divisions respectively, for monitoring purposes; forward the list covering other types of returns to MIDCSD; 11. Transmit original copies of processed tax returns together with the corresponding BCS copies to Administrative Branch concerned within the 30th day of the month following receipt of said documents, for safekeeping. C. PO/CR MONITORING DIVISION 1. Receive NPCS Exception Report (Annex C) from various RDOs and RISSI; 2. Communicate to the bank any exception report received and bill the bank with corresponding penalties, if necessary. D. VAT/WITHHOLDING TAX/MIDCS DIVISION 1. Receive List of Stop-Filers/Non-Filers from various RDOs and RISSI; 2. Compare the lists received from the above offices; 3. Prepare and forward to RISSI updates on the status of stop-filers/non-filers; casia 4. Prepare and forward to RDOs concerned memorandum requiring them to explain why certain taxpayers are constantly included in the monthly List of Stop-Filers/Non-Filers. IV. REPEALING CLAUSE: This Order supersedes all prior orders and existing issuances or portions thereof inconsistent herewith. V. EFFECTIVITY. This Order shall take effect upon approval. (SGD.) JOSE U. ONG Commissioner of Internal Revenue