SEC Updates December 5-11 2022

SEC 2023 SCHEDULE FOR FILING OF THE AUDITED FINANCIAL STATEMENTS AND GENERAL INFORMATION SHEET

• The SEC has set the deadlines for the filing and submission of the 2022 audited financial statements (AFS) and general information sheet (GIS) of corporations through the Electronic Filing and Submission Tool (eFAST).
•    Annual Financial Statements (AFS)
  •  All corporations, including branch offices, representative offices, regional headquarters and regional operating headquarters of foreign corporations whose fiscal year ends on December 31, 2022 shall file their AFS based on the last digit of the SEC registration or license number in accordance with the following schedule:
    • 1 and 2 : May 2,3,4,5
    • 3 and 4 : May 8,9,10,11,12
    • 5 and 6 : May 15,16,17,18,19
    • 7 and 8 : May 22,23,24,25,26
    • 9  and 0 : May 29,30,31 and June 1,2
  •       The SEC extension offices will likewise implement the same coding schedule. Corporations may submit their reports on or before their respective filing dates.
  •       Corporations whose securities are listed on the Philippine Stock Exchange and are covered under Section 17.2 of Republic Act No. 8799, or the Securities Regulation Code (SRC), shall file their AFS within 105 calendar days after the end of their fiscal year, as an attachment to their annual reports.
  •       SEC will accept late filings starting June 5, 2023. Corporations which submitted their reports late will be subject to the prescribed penalties computed from the last date of the aforementioned filing schedule.
  •       Corporations whose fiscal year ends on a date other than December 31, 2022 should file its AFS within 120 calendar days from the end of its fiscal year.
• General Information Sheet (GIS)
  •  All corporations shall file their GIS through eFAST within 30 calendar days from:
    • Stock Corporations – date of actual annual stockholders’ meeting
    • Non-Stock Corporations – date of actual annual members meeting
    • Foreign Corporations – anniversary date of the issuance of the SEC License.
• All Reports
  • All corporations are required to submit their annual reportorial requirements online through eFAST at https://cifss-ost.sec.gov.ph.
  •  Any problem encountered in the enrollment and submission of AFS and GIS in the eFAST shall be accommodated through the email addresses and telephone numbers provided in the SEC Contact Center posted at https://www.sec.gov.ph/contact-us/
  •   Other reports that are not yet accepted through eFAST may be submitted by sending through email at ictdsubmission@sec.gov.ph. Submission of reports over the counter and/or through mail or courier under the SEC Express Nationwide Submission facility shall no longer be accepted.

THE BIR SUSPENDS ALL AUDIT AND OTHER FIELD OPERATIONS EFFECTIVE DECEMBER 16, 2022 UNTIL JANUARY 8, 2023 RMO No. 55-2022, December 22, 2022

• All field audits and other field operations of the BIR relative to examinations and verifications of taxpayers’ books of accounts, records, and other transactions are suspended for the period December 16, 2022 to January 8, 2023. Likewise, no written orders to audit and/or investigate taxpayers’ internal revenue tax liabilities shall be served, except in the following cases:
  • Investigation of cases prescribing on or before April 15, 2023;
  • Tax evasion cases;
  • Processing and verification of estate returns, donor’s tax returns, capital gains tax returns and withholding tax returns on the sale of real properties or shares of stocks together with the documentary stamp tax returns thereto;
  • Examination and/or verification of internal revenue tax liabilities of taxpayers retiring from business;
  • Monitoring of privilege stores (tiangge); and
  • Other matters/ concerns where deadlines have been imposed.
•    Examiners and Investigators shall make use of this period to do office work on their cases and to complete the report on those with already completed work.

THE BIR PRESCRIBES THE RULES AND REGULATIONS IMPLEMENTING THE PROVISIONS OF REPUBLIC ACT NO. 11900, RELATIVE TO THE IMPORTATION, MANUFACTURE, SALE, PACKAGING, DISTRIBUTION, USE, AND COMMUNICATION OF VAPORIZED NICOTINE AND NON-NICOTINE PRODUCTS, AND NOVEL TOBACCO PRODUCTS RR 14-2022

• Manufacturer or importer of vaporized nicotine and non-nicotine products and novel tobacco products must register its business before it starts its operation.
• Place of registration: Excise LT Regulatory Division (ELTRD) BIR National Office.
• It shall apply for a Permit to Engage in Business as Manufacturer or Importer.
• Among the additional requirements are bond (starting at P100,000) and Sworn statements on the goods/products reflecting the price/market value with cost. Sworn statements should be updated and submitted on or before the end of the months of June and December thereafter.
• Importers shall apply for eATRIG via online and processed in the ELTR.
• If goods are already released: no ATRIG shall be issued
• Subsequent application for ATRIG: Importer to submit proof of payment of excise tax on imported products covered previously by ATRIG.
• If a particular brand shall no longer be manufactured on a permanent or temporary basis, notice of stoppage of production must be filed with the BIR.
• Official Register Books must be maintained; transcript sheets of ORB to be submitted on or before the 8^th day of the month following the month of operation.

BIR RULINGS

• Importation of the enumerated Hydrocarbon fluids except Exxsol Hexane shall not be subject to excise tax, However, they are still subject to 12% VAT on importation of goods.
  • Also, the said hydrocarbon fluids except Exxsol Hexane are already determined by the BIR to be used as solvents and raw materials for general purpose adhesive construction, automotive, shoes, and for architectural coatings like household paints (solvent based). BIR Ruling No: OT-275-2022

• The Joint Venture may use the tax credits evidenced by the CWTs Certificate issued in the name of JV partner, applying substance over form. However, the tax credits to be applied by the Joint Venture shall be limited to the total amount withheld as duly supported by certificates of creditable withholding tax.
  • The Joint Venture may benefit from the deduction of input VAT expense or the charging against the cost of the input VAT. However, the input tax shall be restricted to the total amount as duly supported by appropriate sales invoices/ official receipts. BIR Ruling No: OT-276-2022)

• The Heirs is requesting for a reasonable extension to pay the estate tax due through a cash installment. Section 91 (B) of the 1997 Tax Code provides that when the Commissioner finds that the payment on the due date of the estate tax or any part thereof would impose an undue hardship upon the estate or any of the heirs, he may extend the time for payment not to exceed five (5) years in case the estate is settled through the courts, or two (2) years in case the estate is settled extrajudicially.
  • However, the amount for which the extension is granted shall be paid on or before the date of the expiration of the period of the extension, and the running of the Statute of Limitations for assessment, shall be suspended for the period of any such extension. Further, Section 91 (C) of the same Code provides that in case the available cash of the estate is insufficient to pay the total estate tax due, payment by installment shall be allowed within two (2) years from the statutory date for its payment without civil penalty and interest. Hence, the extension to pay the estate tax is granted. Consequently, the executor/administrator or heirs shall pay the estate tax in four (4) installments, without civil penalty and interest. BIR Ruling No. OT-277-2022

• Properties classified as ordinary assets for being used in business by a taxpayer engaged in business other than real estate business are automatically converted into capital assets upon showing proof that the same have not been used for more than two (2) years prior to the consummation of the taxable transactions involving said properties.
  • Two important conditions for the automatic conversation of ordinary assets into capital assets are:
    • The assets were previously used in business by a taxpayer not engaged in real estate business;
    • There must be a showing that the same have not been used in business for more than two (2) years (i.e. the company ceased its business operation for more than 2 years).
  •  Thus, the conveyance of which through sale is subject only to CGT and Documentary stamp tax (DST) and shall not be subject to creditable withholding (CWT) and value-added tax (VAT). (BIR Ruling No: OT-284-2022)

•  The purchases of goods/articles under the construction/development of NHA’s Socialized Housing Program is exempt from project-related income tax, creditable withholding tax and value-added tax on its income received directly in connection with the mentioned project. However, the purchases of goods/articles of the said company shall be subject to VAT, even if the said purchases are to be used for social housing projects and must issue VAT exempt official receipts on its gross receipts from the said socialized housing project. (BIR Ruling: Certificate of Tax Exemption No: NSH-285-2022, NSH-290-2022)

• Sale of house and lot under economic and low-cost housing project of a company duly registered with the Board of Investments under Executive Order (EO) No. 226 is exempt from income tax and creditable withholding tax on its income received directly in connection with the mentioned project. In addition to that, sale of house and lot and other residential dwellings with selling price of not more than Php 3,199,200 is VAT exempted. (BIR Ruling Nos: Certificate of Tax Exemption No: BOI-LEH-286-2022, BOI-LEH-287-2022, BOI-LEH-288-2022, BOI-LEH-289-2022)