RR No. 7-2019 — Amends pertinent provisions of Section 2 under RR No. 11-2018 specifically on the requirements for top withholding agents (Published in Malaya Business Insight on June 14, 2019)

BUREAU OF INTERNAL REVENUE

3 :T YAL COMMUNICATIOL DF INTERNAL TMENT OF FINANCE 1 OF THE PHILIPPINES nniin JUN 13 2019 I0:21 AM.

BUREAUNOFINTERNAL REVENUE A

I Quezon City RECORDS MGT. DIVISION x7f}

May 7,2019

REVENUE REGULATIONS NO. 1- 2019

SUBJECT: Amending the Pertinent Provisions of Section 2 under Revenue Regulations No. 11-2018 Specifically on the Requirements for Top Withholding Agents

TO All Internal Revenue Officials. Employees and Others Concerned

amend the pertinent provisions of Section 2 under Revenue Regulations (RR) No. 11-2018. re: Internal Revenue Code (NIRC) of 1997, as amended, these Regulations are hereby promulgated to Amending Certain Provisions of Revenue Reguiations No. 2-98, as Amended. to Implement Further Amendments Introduced by Republic Act No. 10963, Otherwise Known as the "Tax Reform for SECTION 1. SCOPE. - Pursuant to the provisions of Sections 244 and 245 of the Nationa!

Acceleration and Inclusion (TRAIN) Law".

11-2018 are hereby amended and shall be read as follows: SEC. 2. AMENDATORY PROVISIONS. -- The pertinent provisions of Section 2, RR No

renumbered and further amended to read as follows: "SECTION 2. Certain items of Section 2.57.2 of RR Mo. 2-98. as amended. is hereby

and Rates Prescribed Thereon. Except as herein otherwise provided, xxx. SECTION 2.57.2. Income Payments Subject to Creditable Withholding Tax

XXX

Income payment made by top withholding agents, either private be subjected to the following withholding tax rates: corporations or individuals, to their locat/resident supplier of goods and local/resident supplier of services other than those covered by other rates of withholding tax. (formerly under letters (M) and (W)]: Income payments made by any of the top withholding agents, including non-resident aliens engaged in trade or business in the Philippines. shall

Supptier of goods Supplier of services -- Two percent (2%) -- One percent (I%)

sales/receipts or_.gross..purchuses_or claimed..deductible itemized Top withholding_agenis shall refer to those _iuxpavers u hose _gross

expenses, as the case may be, amourted to TWELVE MILLION PESOS (P12,000,000.00) during the preceding taxable vear.

The top withholding agents by concerned LTS/R.Rs/RDOs shall be published in a newspaper of general circulation. It may also be posted ir: the BIR website. These shall serve as the "notice" to the top withholding agents. The obligation to withhold un ler this sub-sectior shall commence on the first (I") day of the month followir g the month

failure to satisf the aforesaid criteria and duby published as delisted from the existing list of top withholding agents. The initial and succeeding publications shall include the additional top withholding agents and those that are delisted. of publication. Taxpavers who are classified as top withholding ugents prior to the effectivity of these Regulations shall remain as such umtil

which are defined under item (N) of this Section. The term "goods" pertains to tangible personal property. It does not include intangible personal property, as well as agricultural products

pertains to a supplier from whom any of the top withholding agents. The term "local resident suppliers of goods/suppliers of services" regularly makes its purchases of goods/services. As a general rule. this term does not include a casual purchase of goods/services that is

transacted at least six (6) transactions, regardless of the amount per purchase made from a non-regular supplier and oftentimes involving a thousand pesos (f10,000) or more shall be subject to withholding tax under this subsection. The term "regular suppliers", for purposes of these regulations, refer to suppliers who are engaged in business or exercise of profession/calling with whom the taxpayer-buyer has transaction, either in the previous year or current year.' single purchase. However, a single purchase which involves Ten

these Regulations are hereby amended. modified or repealed accordingly SEC. 3. REPEALING CLAUSE. -- All revenue issuances inconsistent with the provisions of

(15) days immediately following the date of publication thereof in any newspaper of general circulation. SEC. 4. EFFECTIVITY. -- The provisions of these Regulations shall take effect after fifteen

Recommending Approval: 0069 54 CARLOS G. DOMIN Secretary of Finance JUN 10 2013

Commissioner of Internal Revenue As CAESAR R. DULAY 025818 BUREAU OF INTERNAL REVENUE NANN jUN 13 2Q19 TD:2TA"M MA 1

J5 REGORDS MGT. JIVISION wa L