[Ask the Tax Whiz] Will BIR audits continue during lockdown?

The imposition of enhanced community quarantine (ECQ) and modified enhanced community quarantine (MECQ) has hampered the operations of both the private sector and government agencies, including the Bureau of Internal Revenue (BIR).

Here we answer some of the top questions now that the country’s tax collection agency has deferred its auditing and other related activities for the meantime.

How is the BIR handling operations during the current ECQ and MECQ?

The BIR released two revenue memorandum circulars, RMC 92-2021 and RMC 93-2021, regarding the extension and suspension of the running of the statute of limitations on assessment and collection of taxes in response to the current quarantine classifications declared by the national government’s Inter-Agency Task Force for the Management of Emerging Infectious Diseases.

How will the suspension of audit and other activities involving the BIR work?

Initially, the BIR set August 6 as the deadline for filing the papers, letters, and documents listed below. But with the imposition of both ECQ and MECQ affecting revenue district offices in several areas like the National Capital Region, nearby provinces, and those with high COVID-19 cases, extensions were made.

The suspension of the running of the statute of limitations shall apply concerning the issuance and service of assessment notices, warrants, and enforcement, as well as collection of deficiency taxes.

Will the audit deferment affect taxpayers as well?

Definitely. The suspension of the running of the statute of limitations is extended for 60 days after the lifting of the ECQ or MECQ. This will give ample time for taxpayers to prepare necessary documents for submission to the BIR and also to prepare funds for the settlement of their cases.

For more inquiries on tax, watch out for the next edition of Ask the Tax Whiz and download the TaxWhizPH app for free on Google Play and the App Store. You can also avail of our free tax assistance service by scanning the QR code below or emailing us at consult@acg.ph. Use the promo code ACG10RAPPLER.

– Rappler.com

Mon Abrea, CPA, MBA, is the co-chair of the Paying Taxes-EODB Task Force. With the TaxWhizPH mobile app as his brainchild, he was recognized as one of the Outstanding Young Persons of the World, an Asia CEO Young Leader, and one of the Ten Outstanding Young Men of the Philippines because of his tax advocacy and expertise. Currently, he is the chairman and CEO of the Asian Consulting Group and trustee of the Center for Strategic Reforms of the Philippines – the advocacy partner of the Bureau of Internal Revenue, Department of Trade and Industry, and Anti-Red Tape Authority on ease of doing business and tax reform. Visit www.acg.ph for more information or email him at mon@acg.ph and download the TaxWhizPH app for free if you have tax questions.