Question & AnswerQ&A (BIR REVENUE MEMORANDUM ORDER NO. 38-92)
Its purpose is to supplement and amend the guidelines and procedures in the processing of tax credit/refund of excess withholding tax/overpayment of individual income tax for 1991, specifically covering BIR Form Nos. 1701 and 1701A.
The employee must present a copy of the Authority to Accept Payment (ATAP) to establish payment of the second installment, which must be attached to their income tax return.
The Office of the Collection Officer will receive the return, but an ATAP shall be issued for payment of penalties for late filing, and the validated ATAP must be attached to the ITR submitted to the employer.
Such employers shall be assessed for under-remittance of said tax payments for the month when the credit/refund was made.
Employers must note or stamp on the upper right-hand corner of the returns with "RECOMPUTED UNDER RA 7167 FOR (HUSBAND/WIFE)."
They must stamp them "Verified from the Original Duplicate Copy" and sign them.
The employee must secure a "certified true copy" of the ITR from the Revenue District Office where they filed the return.
Their employers must require each spouse to present both copies of their ITRs to ensure only one spouse claims the additional exemption, and both ITR copies must be attached to the Amended Alpha List of Employees.
Only one spouse may claim the exemption, and adjustments are reflected in the recomputation. The employer of the spouse not claiming the exemption shall note on the ITR that the exemption has already been claimed by the other spouse.
They must file a written claim for refund with their ITR copy and a certification from the employer that the employee was not included in the amended alpha list submitted to the RDO for processing.
The RDO must check completeness of attached supporting documents and ITRs/ATAPs, verify correctness of exemptions and computations, assess withholding agents for unpaid amounts, report assessments to the Withholding Tax Division by a set deadline, and process subsequent refundable ITRs and claims.
Employees with new employers must submit their 1991 ITRs for recomputation to their present employers. Those no longer employed must file a written claim for refund with certified ITR copies and withholding tax statements to the RDO.
Employers may allow credit against taxes withheld from compensation starting September 1992 or refund the amounts immediately, then recover the refunded amount from future tax remittances until fully repaid.