Amendment to Section 243 of Revenue Regulations No. 2 (Income Tax Regulations)

November 26, 1976 REVENUE REGULATIONS NO. 08-76 SUBJECT : Amendment to Section 243 of Revenue Regula tions No. 2 (Income Ta x Regulations), concerning information returns as to payments of P1,800 or more TO : All Internal Revenue Officers and others concerned SECTION 1. Pursuant to the provisions of Section 338 of the National Internal Revenue Code, Section 243 of Revenue Regulations No. 2, otherwise known as the Income Tax Regulations, implementing Section 77 of the same Code, is hereby amended to read as follows. aisa dc "Section 243. [Return of information as to] INFORMATION RETURN ON AGGREGATE payments of P1,800 OR MORE . All persons, INCLUDING corporations, partnerships, and associations, making payment to another person of fixed or determinable income IN AN AGGREGATE AMOUNT of P1,800 or more in a calendar year must render a return thereof to the Commissioner of Internal Revenue [within the time fixed for the filing of annual returns of said person, corporations, partnerships and associations] ON OR BEFORE THE THIRTY FIRST DAY OF JANUARY OF THE SUCCEEDING YEAR. [The name and address of the recipient of the income should be stated, if possible. Although to make necessary a return of information the income must be fixed or determinable, it need not be annual or periodical.] "THE RETURN SHALL BE MADE ON BIR FORM 1701B. SUCH RETURNS SHALL BE ACCOMPANIED BY AN ALPHABETICAL LIST IN DUPLICATE SHOWING THE NAME, TAXPAYER ACCOUNT NUMBER, AND CURRENT TAX ADDRESS OF PERSONS TO WHOM TOTAL ANNUAL PAYMENTS OF P1,800 OR MORE WERE MADE, THE NATURE OF PAYMENT, AND THE GROSS AMOUNT THEREOF (SAMPLE FORM ATTACHED). "THE TRIPLICATE COPY OF BIR FORM 1701B, TOGETHER WITH THE ORIGINAL COPY OF THE ALPHABETICAL LIST SHALL BE FILED WITH THE REVENUE REGIONAL DIRECTOR, REVENUE DISTRICT OFFICER, OR COLLECTION AGENT WHERE THE PRINCIPAL OFFICE OF THE PAYOR IS LOCATED. THE ORIGINAL AND DUPLICATE COPIES OF BIR FORM 1701B SHALL BE FURNISHED THE RECIPIENT (PAYEE) OF THE INCOME ALSO ON OR BEFORE THE THIRTY FIRST DAY OF JANUARY OF THE SUCCEEDING YEAR. THE PAYEE SHALL ATTACH THE ORIGINAL COPY OF BIR FORM 1701B TO HIS INCOME TAX RETURN FOR THE SAME TAXABLE YEAR. PROPER ADJUSTMENT MAY BE MADE BY PAYEES FILING INCOME TAX RETURNS ON A FISCAL YEAR BASIS. AN ACKNOWLEDGED COPY OF THE ALPHABETICAL LIST SHALL BE ATTACHED BY THE PAYOR TO THE ORIGINAL COPY OF HIS INCOME TAX RETURN FOR THE YEAR PAYMENTS WERE MADE. "WHERE THE PAYOR FILES ITS INCOME TAX RETURN ON A FISCAL YEAR BASIS, IT SHALL ATTACH THE ACKNOWLEDGED COPY OF THE ALPHABETICAL LIST FOR PAYMENTS MADE DURING THE PRECEDING CALENDAR YEAR. "The names of all [employees] PERSONS to whom ANNUAL payments of P1,800 or [above] MORE [are] WERE made, whether such total sum is made up of RENTS, ROYALTIES, ANNUITIES, INTERESTS, PENSIONS, SHARES OF PROFITS, AND DIVIDENDS, salaries, wages, FEES, commissions or compensation in any other form WHICH WERE NOT SUBJECTED TO WITHHOLDING, and other fixed determinable income, must be reported. Payments in kind, such as living quarters, meals, and lodging, STOCKS, OTHER PERSONAL PROPERTY, ETC., are taxable income to the recipient and, as such, ITS MONEY VALUE should be [reported] INCLUDED. [if the sum total of the same and other compensation received in cash shall amount to P1,800 or more during the year] "THE INFORMATION RETURNS PRESCRIBED HEREIN SHALL ALSO BE FILED, REGARDLESS OF THE AMOUNT OF INTEREST PAID UPON BONDS AND MORTGAGES OR DEEDS OF TRUST OR OTHER SIMILAR OBLIGATIONS OF CORPORATIONS. "In the case of payments of annual or periodical income to nonresident alien individuals or to foreign corporations or firms not engaged in trade or business within the Philippines [and not having any office or place of business therein] AND INTERCORPORATE DIVIDENDS WHICH WERE SUBJECTED TO WITHHOLDING, the return by the withholding agents shall constitute and be treated as return of information UNDER SECTION 77 OF THE NATIONAL INTERNAL REVENUE CODE." SECTION 2. These Regulations shall take effect on January 1, 1977 beginning with information returns as to payments made in the year 1976. dctai CESAR VIRATA Secretary of Finance Recommended by: EFREN I. PLANA Acting Commissioner of Internal Revenue TAN-1456-040-3 INSTRUCTIONS A. Payors shall prepare a set of this form for every person to whom they have paid any of the following fixed or determinable income for the preceding calendar year; 1. In an aggregate amount of P1,800.00 or more, of a. rents b. royalties c. annuities d. interest e. pensions f. shares of profit g. dividends not subject to withholding and h. wages, salaries, fees, commissions or other compensation not subject to withholding, or 2. Regardless of amount, of a. interest from bonds and mortgages or deeds of trust or other similar obligations of corporations. B. Fill in all applicable blanks accurately. Current Tax Address is the address used by the recipient of the income (payee) in his income tax return. The box for "Total Amount" shall be filled in with the total amount received by the payee from the payor. C. File with the Revenue Regional Director, or Revenue District Officer or Collection Agent, where your principal office is located, the BIR copies of this form with the original and duplicate copies of the Alphabetical List on or before January 31 of the succeeding year for payments made during the preceding calendar year. D. Attach to your income tax return to be filed for the year payments were made, an acknowledged copy of the Alphabetical List which was previously filed with the BIR office on or before January 31. If you are filing your income tax return on the basis of a fiscal year, attach to the return, the acknowledged copy of the Alphabetical List of payments made during the preceding calendar year. E. Furnish every payee on or before January 31st his copies of this form (the copy to be attached to his income tax return and his file copy). NOTE Instructions are to be printed at the back of BIR Form 17.01-B ALPHABETICAL LIST OF BIR FORM 1701-B SUBMITTED For the Calendar Year ______ NAME OF PAYEE TAN CURRENT TAX ADDRESS NATURE OF PAYMENT AMOUNT SUBMITTED BY: ______________________________ Name of Payor Tan _______________________ Address of Payor ___________________________________ Signature of Payor/Authorized Representative ___________________ Title