QuestionsQuestions (BIR REVENUE REGULATIONS NO. 16-2010)
To provide guidelines for filing confidential information for NIRC violations, facilitate investigation of cases arising therefrom, delineate responsibilities of BIR offices involved, and set rules for the grant and payment of rewards.
Any qualified person who voluntarily provides definite and sworn information not yet in the possession of the BIR nor of public knowledge, leading to discovery of NIRC fraud/violations and resulting in recovery/collection, conviction, imposition of fines/penalties, and/or other actionable outcomes.
It must meet ALL requisites: (1) informer not disqualified (including no relationship within the 6th civil degree); (2) voluntary sworn statement with definite, concise, credible facts that specify the taxpayer, taxable period, violated law, witnesses addresses (if any), and other pertinent facts; (3) information not yet in the possession of the BIR; (4) not referring to a case already pending/previously investigated/examined by the Commissioner/Secretary/ deputies; (5) not exactly similar to a previous information covering the same taxpayer and scheme for the same taxable year/period; and it must be supported by substantial evidence (with requirements on certified true copies and acceptable alternatives).
Disqualified are: (a) a BIR official/employee or any other incumbent public official/employee; (b) a relative within the 6th civil degree of consanguinity of a BIR official/employee or other public official/employee; and (c) retired/separated BIR officials or other public officials who acquired the information in the course of their duties during incumbency.
It must be under oath and personally executed and filed by the informer before the Chief, Prosecution Division, BIR National Office, for certain violations, or before the Chief, Legal Division, Revenue Region, if the estimated basic tax liability is less than P1,000,000.00.
Attempt to Evade or Defeat Tax; Failure to File Return/Supply Correct Information/Pay/Withhold and Remit/Refund Excess Taxes Withheld on Compensation; Failure or Refusal to Issue Receipts/Sales or Commercial Invoices/printing violations; Unlawful Pursuit of Business; Use of multiple TINs; Making False Entries/Records/Reports or using falsified/false accountable forms; and other violations of the NIRC.
When the estimated basic tax liability arising from the alleged violation is less than P1,000,000.00.
It must be definite, concise and credible and must specify: (1) name and address of the taxpayer; (2) taxable period; (3) internal revenue law allegedly violated; (4) address of witnesses (if any); and (5) other pertinent facts.
Examples include: BIR Certificate of Registration; Income Tax Returns; Deed of Absolute Sale; SEC license to operate business in the Philippines; SEC GIS; audited financial statements; and other relevant documents.
The informer must state who has possession/control of the documents/records/books and/or the location where they are kept.
Because a valid confidential tip must not already be reasonably available in BIR records. It will be invalid if the information is already available from BIR systems like TPI or is public knowledge (e.g., already reported in media), unless it cannot be established that the information is already available from BIR records.
From start until completion of the investigation, the docket must bear no information on identity of the informer; the name/any information that may lead to identity in the second copy intended for NID/SID is deleted by Records Management. Exception: in extremely meritorious cases where communication is needed, the Chief NID or SID may be given access to identity/contact details.
To number and record the Confidential Information in the Confidential Entry Book, ensure identification/marking/sequential numbering of documents, retain the first copy for filing/reference, forward designated copies to relevant units for investigation and reward processing, and observe strict confidentiality of contents.
Sixty (60) working days from assignment.
Thirty (30) days from assignment to evaluate.
The informer is notified within ten (10) working days that the denunciation will be referred for regular audit to the appropriate Revenue Region/District Office, or the information is archived if the allegations aren’t substantiated, addresses/contacts aren’t provided, or the informer cannot be reached despite diligent efforts.
They may not divulge to third parties, including the informer, any information, data, or documents gathered during investigation; they may only provide updates on status, not specific actions or evidentiary details.
Entitlement requires that the confidential information is instrumental in discovering the tax fraud/violation and results in actual recovery/collection, conviction, imposition of fine/penalty, or actual collection of a compromise amount (if amicable settlement). The reward is 10% of taxes and penalties (or compromise amount) actually collected as a result of the confidential information, or P1,000,000 per case, whichever is lower.
If two or more informers: the one who gave the information in full satisfaction of conditions is entitled. If each meets conditions, the one who first furnished the information is entitled. If two or more qualified persons jointly filed the confidential information, they divide the reward equally.
Taxes assessed as a result of valid confidential information, if involving criminal fraud established beyond reasonable doubt, shall not be compromised under Section 204 of the NIRC.