Supplement to Revenue Memorandum Order No. 59-97 on the Voluntary Assessment Program

October 30, 1997 REVENUE MEMORANDUM ORDER NO. 60-97 SUBJECT : Supplement to Revenue Memorandum Order No. 59-97 on the Voluntary Assessment Program TO : All Internal Revenue Officers, Officials and Employees of Authorized Agent Banks and Others Concerned I. BACKGROUND This Order supplements RMO No. 59-97 on the Voluntary Assessment Program (VAT) specifically relative to additional policies and procedures to be followed in the processing of all returns filed under the VAP. II. POLICIES 1. The Voluntary Assessment Program coverage is expanded as follows: Item No. 3 of RMO No. 59-97 is hereby amended to read as: "3. Persons/Cases not covered The following shall be excluded from the coverage of the VAP under this Order: 3.1. Dealers of petroleum products and purchasers of goods and services from petroleum companies who have availed of the VAP under RMO No. 39-96, for the years 1993 to 1995 . However , said dealers may avail of the VAP for the year 1996 . Those who did not avail of the VAP under RMO No . 39-96 , may avail of the VAP under RMO No . 59-97 for the years 1993 to 1996 . 3.2 Withholding Agents (WAs) with respect to taxes already withheld but not remitted. However , WAs who failed to withhold and remit the appropriate taxes may be covered by VAP . 3.3 Persons to whom validly issued Letters of Authority have been served. However , Letters of Authority served after November 1 , 1997 shall not preclude the concerned taxpayers from availing of the VAP . Moreover , availment of the VAP concerning Documentary Stamp Tax on original issues of shares of stock shall likewise not be barred by the issuance of a Letter of Authority , regardless of the date of service thereof . 3.4 Persons under investigation by the Tax Fraud Division and/or the Regional Special Investigation Divisions as a result of verified information filed by an informer under Section 281 of the NIRC, as amended, and duly recorded in the Official Registry Book of the Bureau before the date of availment under VAP; 3.5 Persons against whom tax cases have been filed in Court." 2. Taxpayers availing of VAP shall use the appropriate tax returns together with the Voluntary Assessment Form. In the case of the Documentary Stamp Taxes, BIR Form No. 2000 shall be used. 3. For taxes pertaining to one-time transactions, (i.e. estate/donor's tax, capital gains tax) the existing procedures in processing the returns, for clearance purposes, shall be followed. III. PROCEDURES The procedures on the receipt, transmittal and processing of tax returns filed thru the AABs as well as the processing and submission of Batch Control Sheets (BCS) shall be prescribed under RMO No. 29-91, RMO No. 16-92 and RMO No. 61-94. In case Computerized Revenue Districts, the procedures provided in the Operations Manual relative to the Registration System (REG), the Collection and Bank Reconciliation System (CBRS) and the Returns Processing System (RPS) shall govern. In addition, the following procedures shall be observed: 1. The Revenue District Officers shall make available sufficient tax returns and VAP Forms to the AABs and requesting taxpayers. 2. AABs shall ensure that the returns are properly marked "Filed under VAP per RMO No. 59-97". 3. For Non-computerized Districts: 3.1 The Revenue District Office shall segregate the returns filed under VAP per RMO No. 59-97 from the regular returns, upon retrieval of the returns from AABs. Where a taxpayer files an amended return to replace a refundable return, the receiving RDO must request ISOS to locate the refundable return and to stop processing of the corresponding claim for a refund if it has not been refunded yet. If the refund has already been released to the taxpayers, notice should be given to the RDO concerned, to ensure that the refunded amount shall be assessed and paid by the taxpayers availing of the VAP. 3.2 Number the returns filed under VAP consecutively as follows: Ex.: RDO No. 20, Balanga Bataan VAP-020-000001 VAP-020-000002 VAP-020-000003 3.3 Prepare report on collection using the prescribed format (Annexes "A" and "B"), making sure that the taxes collected are included in the Form 12.09 report of the RDO; 3.4 Transmit the returns and the VAP collection report to the Voluntary Assessment Committee (VAC) in the Revenue Region covering the Revenue District not later than December 10, 1997. llcd 4. For Computerized Revenue Districts: 4.1 The Revenue Data Center shall received from the AAB-HO two (2) copies of the returns together with the attachments for the CBR System and the Returns Processing System (RPS). 4.2 Collection and Bank Reconciliation System (CBRS) copy: 4.2.1 The Document Processing Division of the RDC shall segregate the VAP returns from the regular returns during the pre-processing stage; verify data encoded by AABs; and forward the returns to the Administrative Division of the RDC. 4.2.2 The Administrative Division of the RDC shall transmit the VAP returns to the RDO concerned for the preparation of VAP Collection Reports. The RDOs in the Computerized District Offices shall then transmit the VAP returns to the VAC at their respective Regional Offices. 4.3 Returns Processing System (RPS) copy: 4.3.1 The Document Processing Division shall segregate the VAP returns from the regular returns, encode them, and forward the same to Quality Assurance Division (QAD) 4.3.1 The QAD shall then prepare the account adjustment form for penalty remission. 5. For the Revenue Regional Offices: The Voluntary Assessment Committee (VAC) shall be created at each Regional Office to be composed of the Regional Director as Chairman, Asst. Regional Director as Vice-Chairman with the following Members, the Chiefs of the Assessment Division, Legal Division and the Revenue District Officer concerned with the following functions: 5.1 Gather the returns filed under VAP and evaluate these returns; 5.2 Coordinate with the National Assessment Support Task Force (NASTF) under the Third Party Information Program in identifying erring taxpayers who did not avail of the VAP; cdll 5.3 Prepare and submit Consolidated VAP Collection Report, using the prescribed format (Annex "C"), to the Assistant Commissioner for Assessment Service; 5.4 Submit list of taxpayers recommended for investigation and possible prosecution to the Commissioner thru the Deputy Commissioner for Operations. 6. For the Assessment Service: 6.1 The NASTF, under the Assistant Commissioner (Assessment Service), shall monitor the implementation of the VAP in the Regional Offices; and 6.2 Consolidate the recommendations of the VAC at the Regional Offices and refer them to the concerned Office for appropriate action. 7. For one-time transactions, i.e. capital gains tax, estate/donor's tax, the receiving RDO shall retain the triplicate copy of the VAP return. A photocopy of the same, and the corresponding VAP Form, shall then be transmitted to the VAC at the Regional Office. The Revenue District Officer and the Assessment Division shall process the returns for issuance of the tax clearance (i . e . the Certificate Authorizing Registration (CAR) , or the TCL) , after the payment of VAP , following the existing procedures prescribed under the Audit System for Computerized Districts and RMO No. 12-96 for Non-Computerized Districts . 8. Collections under the VAP should be included in the Monthly Form 12.09 Collection Reports of the Revenue District Offices. IV. REPEALING CLAUSE All other issuances and/or portions thereof inconsistent herewith are hereby repealed and amended accordingly. prLL V. EFFECTIVITY This Order shall take effect immediately. (SGD.) LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue ANNEX A ANNEX B ANNEX C