New Taxpayer Account Number

May 22, 1977 REVENUE MEMORANDUM ORDER NO. 23-77 SUBJECT : New Taxpayer Account Number TO : All Internal Revenue Officers and Others Concerned Inasmuch is the present Taxpayer Account Number (TAN) System had not been able to achieve the purpose for which it was promulgated which is the creation of a master file system and appropriate identification of taxpayers, a new TAN system has been implemented starting this year. I . Purpose An identity number system is the key to the linkage of a taxpayer's records. It is a way to minimize or to simplify processing work, to considerably reduce data-errors, and to facilitate the service of information needs of the various units of organization in the bureau. To completely consolidate all tax transactions of a taxpayer, all his/its documents with the bureau must carry the same TAN, hence the new system specifies that: cdta A. Only one TAN is issued to each person for his permanent use in all his transactions with the bureau. B. Every TAN is unique such that no two (2) taxpayers will use the same number. C. There is a built-in-system of checking whether the number indicated by the taxpayer is correct and complete. The new system answers the above requirements and generates a taxpayer's identity number using as basis the individual's name and date of birth or date of incorporation or registration in the case of juridical persons. It uses the soundex system of identity code generation. II . The Soundex System A. The Soundex System is basically a method of generating a set of numbers by computer, based on the sound of the key letters of a word, specifically, that of a name. Letters with similar sounds are grouped together and assigned a standard set of numeric codes. Based on this and following a set of rules, a digit code for a particular name is generated. However, the soundex code alone is expected to come out with some duplicated codes for the reason that persons may have the same names or have different names but algorithmically contain the same type of letters. To narrow down this possible duplication, an additional feature is incorporated into the system to separately identify the duplicate soundex codes. One such feature is the incorporation of the person's date of birth which is also a five-digit code (month, day and year). B. Still there may be duplications of code for soundex names and birthdays or dates of incorporation or registration. To entirely eliminate these possibility, another code, a serial number is added using all the letters of the alphabet (with the exception of the letter I) plus the nine digits in the unit position of cardinal numbers to make it thirty-five serial numbers available as anti-duplication codes. C. A method of checking the accuracy of the identity code is built-in to the system by appending a check digit at the end of the string. The check digit spots possible transpositions or errors in the number. D. Actually, the new TAN is composed of twelve digits: five digits for soundex number, five digits for date of birth, one digit for serial code and one digit as check digit. For example: Name of taxpayer Julian L. Palatino Date of birth January 25, 1951 TAN P4354-A2151-B-0 Where: P4354 name in soundex code A 2151 date of birth B serial code 0 check digit III . Policies A. The generation of the new Taxpayer Account Numbers shall be centralized in the Data Processing Center. B. All taxpayers who have lost or forgotten the assigned new Taxpayer Account Number may be serviced in the TAN Unit of the Central Office, Regional Directors' Offices, Revenue District Offices, or Collection Agents' Offices. Unless the new list of Taxpayer Account Numbers issued are already available at these stations, application forms, described below, duly accomplished by the requesting taxpayers, shall be forwarded by the servicing unit to the DPC for verification of the new TAN. C. TAN ID cards will be issued to individuals and TAN ID certificates to corporations and partnerships. The postal system will be used to deliver the TAN ID cards and certificates to the taxpayers. D. The taxpayer shall still use his old TAN pending receipt of the new TAN. E. Non-filers who need TAN's to transact business with the government shall still be issued the old TAN under the old systems until after the 3rd implementation phase. IV. Implementation Phases The implementation of the numbering system for all tax filers will be done in three (3) phases. A. First year phase: 1,300,000 taxpayers, representing those who paid taxes upon filing their income tax returns in 1976 and those from whose salaries, wages or remunerations in 1975 were withheld income taxes by their employers and remitted to the BIR, will be given new TANs. To be included in the initial phase are corporations and partnerships. B. In the second year of implementation (1978) another 1.5 million tax filers will be issued new taxpayer account numbers. C. In the third year, all other taxpayers and those who will need TAN for purposes of transactions with the government will be issued the new TANs. V. Procedures A. Based on the 1975 income tax returns, the DPC will create a TAN file based on the soundex system. The implementing phases above shall be followed by the DPC in the generation of the soundex TAN . To those without birth dates on their 1975 income tax returns, the DPC will send queries to them to enable the Center to generate the new TAN and issue to them their TAN ID cards by mail. At the initials stage this year, the DPC will list alphabetically and issue to all regional offices and district offices a list of TAN numbers issued for their reference. B. Requests for new TAN. 1. Queries or requests for new TAN number by taxpayers who have lost their TAN ID cards shall be serviced through any of the stations mentioned above. The bureau official or employee concerned shall refer to the alphabetical new TAN list in his possession, if any, and if the taxpayer's name appears therein, he shall be given a certification of his new TAN, using the attached TAN certification form and shall pay the usual P0.30 documentary and P0.30 science stamps. (The Revenue Regional Director shall be responsible for mimeographing the certificate and distribute it to all the offices concerned.) 2. The bureau officer concerned shall prepare the certification in duplicate with the duplicate to be sent to the DPC for reference and statistical control. A notation shall also be made on the new TAN list under the name of the taxpayer to the effect that a certification was issued to him/her on a given date. 3. The taxpayer shall also be issued by the servicing BIR officer a duplicate TAN ID card, the entries of which shall be typewritten by the servicing officer (blank TAN ID cards in a different color from the original will be issued to all query stations by the DPC). 4. No other charge except the documentary and science stamps is authorized to be collected from the taxpayer. C. However, if a taxpayer's name does not appear in the list but he is supposed to be included in the first implementation phase, it means that no TAN ID card has as yet been issued. The taxpayer shall therefore be requested for information necessary to accomplish a pre-numbered TAN Application Form, sample attached. D. The TAN Application Form is a semi-accountable form in duplicate and is issued to all query stations in booklet form. The BIR employee at the query station shall fill up the form based on the information given by the taxpayer; then it shall be signed by the taxpayer in the appropriate boxes. The tear-off stub of the original shall be given to the taxpayer with instructions to him to use the application number as his temporary TAN number in all transactions with the BIR. The taxpayer should be made aware that his temporary number includes the revenue region and revenue district codes making a total of 12 characters for his temporary TAN. The query station shall then send to the Data Processing Center the original of the application form for processing and shall keep the duplicate in the booklet for his file and reference. E. As soon as possible the DPC will send back to the taxpayer concerned the TAN ID card with accompanying stubs for acknowledgment and corrections, samples attached. The stubs are either mailed back to the DPC by the taxpayer or he may submit it to the BIR Office in his area which office in turn shall forward these documents immediately to the DPC. F. Receipt by the taxpayer of his TAN ID card will automatically cancel his temporary TAN. G. When payments are made by a taxpayer, the collection officer should invariably request the taxpayer to present his TAN ID if he has one, for checking against the corresponding TAN entry in his ITR or other pertinent documents and so that proper TAN entry can be made on the official receipts VI. Effectivity This Order takes effect immediately. EFREN I. PLANA Acting Commissioner of Internal Revenue TAN P4519 F2828-A-8 ANNEX ___________________ (Date) CERTIFICATION (New TAN) TO WHOM IT MAY CONCERN: This is to certify that Mr./Mrs/Miss ___________________________ was issued the new TAN ___________________ as his/her permanent Identification number. This certification is issued upon request of the taxpayer. _____________________________ Branch Chief/Rev. Dist.. Off/Coll. gent __________________ (Date) ___________________ (Date) CERTIFICATION (New TAN) TO WHOM IT MAY CONCERN: This is to certify that Mr./Mrs./Miss ________________________ was issued the new TAN ______________________ as his/her permanent identification number. This certification is issued upon request of the taxpayer. ______________________________ Branch Chief/Rev. Dist. Off./Coll. Agent __________________ (Date) TAN ID CARD TAN ID CERTIFICATE FORMS