WEEKLY TAX UPDATES [JULY 30-AUGUST 3, 2018]

A.     BIR ISSUANCE ON TRAIN LAW-ESTATE TAX IMPLEMENTATION FOR THIS WEEK

 

TAX HIGHLIGHTS FOR THE REQUIREMENTS ON THE WITHDRAWAL FROM THE BANK DEPOSIT ACCOUNT(S) OF A DECEASED DEPOSITORS/JOINT DEPOSITOR WITHOUT THE REQUIRED e-CAR

 

The BIR has issued Revenue Memorandum Circular (RMC) No. 62-2018 dated June 28, 2018 [with released date on July 10, 2018] clarifying the requirements on the withdrawal from the bank deposit account/s of a deceased depositors without the required Electronic Certificate Authorizing Registration (e-CAR)

 

In this regard, we are summarizing the following tax highlights for your reference:

 

  1. The executor, administrator or any of the legal heirs/s of a decedent who, prior to his death, maintained bank deposit(s) may be allowed withdrawal from the said bank account(s):

 

Ø  Within one (1) year from the death of the depositor; and

Ø  To be subjected to 6% Final Withholding Tax (FWT)

 

  1. For joint accounts, the FWT shall be based on:

 

Ø  SHARE of the decedent in the joint bank deposits

  1. Prior to withdrawal, the executor, administrator or any of the legal heirs/s of the decedent are required to present before the bank the following:

Ø  Copy of the Tax Identification Number (TIN) of the estate of the decedent

Ø  BIR Form No. 1904 of the estate duly stamped received by the concerned RDO

                                                                

  1. The Bank shall:

Ø  Issue the corresponding BIR Form No. 2306 certifying the withholding of  6% FWT

Ø  File the Quarterly FWT

Ø  Remit the same on or before the last day of the month following the close of the quarter during which the withholding was made

 

  1. All withdrawal slips for this purpose shall contain the following terms and conditions:

Ø  A sworn statement by any one of the surviving joint depositor/s to effect that all the other joint depositor/s is/are still living at the time of withdrawal; and

Ø  A statement that the withdrawal is subject to 6% FWT

 

  1. Bank deposits already declared for estate tax purposes and are indicated in the eCAR issued shall no longer be subjected to 6% FWT

7.      This Circular shall not be construed as preventing the bank, before allowing any withdrawal from the bank deposit(s), from requiring pertinent documents for the purpose of ascertaining the:

 

Ø  Identity of the heirs or authorized representative

Ø  Right to claim of the heirs or authorized representative

 

B.      BIR MEDIA RELEASES FOR THIS WEEK

 

  1. Batangas Beach Resort owners charged with unlawful pursuit of business for failure to register with the BIR.

 

  1. BIR Cebu City padlocked 5 warehouses and 3 restaurants and confiscated POS/CRMs with expired Permit To Use (PTU).

 

  1. Pampanga hollow blocks and gravel and sand business owners charged with unlawful pursuit of business for failure to register with the BIR, absence of business permit and wilful failure to pay tax.

 

  1. BIR Makati padlocked a customer service company for failure to issue registered VAT receipts to clients, usage of expired receipts and failure to file and pay VAT returns.

 

  1. 3 eFPS Cavite companies engaged in waste disposal, sale of electronics and manufacturing of textile products charged with tax evasion.

 

  1. Batangas businessmen charged with wilful failure to pay taxes for consistently filing their tax returns through eFPS without paying the corresponding taxes.

 

  1. Supreme Court upholds the taxability of government employees’ allowances and fringe benefits and strikes down the responsibility of governor, city mayor, municipal mayor, barangay captain, and heads of office in government to withhold and remit taxes.