Question & AnswerQ&A (BIR REVENUE REGULATIONs NO. 3-88)
Only a VAT-registered person may be granted a tax credit or refund of value-added taxes paid corresponding to zero-rated sales of goods or services.
The application should be filed with the Bureau of Internal Revenue within two years from the date of exportation.
The application for refund can be made only after the expiration of two successive quarters following the end of the taxable quarter in which the input tax was paid.
A newly registered person can apply for refund only after the expiration of 180 days from the date of registration or actual commencement of business operation, whichever is later.
Refunds shall only be for the ratable portion corresponding to the taxable operations.
It shall be filed with the Revenue District Office of the city or municipality where the principal place of business of the applicant is located or directly with the Commissioner, Attention: VAT Division.
A photocopy of the purchase invoice or receipt evidencing the VAT paid must be submitted together with the application, as well as other applicable documents like export documents, Central Bank statements, contracts, and import entry documents as stated in the regulations.
Refundable input tax = (Amount of Zero-rated Sale x Total Amount of Input Taxes) / Total Sales.
Input taxes on the VAT-taxable portion can be refunded or credited, but input taxes on the exempt portion can only be credited against output tax due; they cannot be refunded or become basis for issuance of Tax Credit Certificates.
The person may apply within two years from the date of cancellation for the issuance of a tax Credit Certificate for any unused input tax credit as of the date of cancellation.
They shall be filed with any duly accredited bank in the city or municipality where the principal place of business is located, or if none, with the collection agent, municipal treasurer, or Revenue District Officer.
All no cash payment returns shall be filed with the Revenue District Officer, Collection Agent, or authorized Municipal Treasurer where the filer’s principal place of business is located.
The return shall be filed with the Revenue District Officer where the principal place of business is located. The Office will issue a Tax Debit Memo covering the amount paid by TCC, and if partly paid by TCC and cash, a partial Tax Debit Memo will be issued.