BIR REVENUE MEMORANDUM CIRCULAR NO. 40-92

: The purpose is to prescribe the rules for converting foreign currency denominated income payments into Philippine Peso for the collection of withholding taxes due thereon.
: It should be converted at the time the income subject to withholding is payable or paid.
: The applicable rates are either the interbank reference rate at the time the income is payable or paid if no foreign exchange transaction occurs, or the bank conversion rate (buying or selling rate, whichever is applicable) at the time of the foreign exchange transaction through an authorized agent bank in the Philippines.
: It refers to the exchange rate prevailing between banks at the time the income is payable or paid, used when no actual foreign exchange transaction occurs and the conversion is merely an accounting accrual.
: The bank conversion rate is used when the foreign currency payment has been converted through an authorized agent bank in the Philippines at the time of the transaction.
: The foreign exchange conversion rate used must be the same as the rate used in recording the income payment or expense in the withholding agent’s books of account.
: They are to be settled in Philippine currency.
: Yes, all previous revenue issuances inconsistent with this memorandum are amended or modified accordingly.
: That is the date the memorandum circular was adopted and became effective.