QuestionsQuestions (BIR Revenue Memorandum Order No. 7-2015)
To adopt and implement a uniform application of compromise penalties for violations of the National Internal Revenue Code (NIRC), update the existing schedule under RMO No. 19-2007, and delete certain acts previously covered that are considered fraudulent under the definition.
RMO No. 19-2007. RMO No. 7-2015 states that the policies and guidelines in RMO No. 19-2007 remain for strict compliance.
The Revised Schedule of Compromise Penalties embodied in Annex “A” (marked as Annex “A”) which is made an integral part of the Order.
It directs that compromise penalties in such cases must be imposed strictly according to the amounts in the Revised Schedule of Compromise Penalties.
They must be referred to the concerned division having jurisdiction over the case for the institution of the corresponding criminal action.
No. The Order emphasizes that compromise penalties are only suggested amounts for settlement of criminal liability; they may not be imposed or exacted if the taxpayer refuses to pay.
Only when duly approved by the Commissioner or concerned Deputy Commissioner, or in proper cases by the Regional Director.
They must be itemized, but should not form part of the assessment notice that reflects deficiency basic tax, surcharge, and interest; instead, they should appear in a separate assessment notice/demand letter as the suggested amount to pay in lieu of criminal prosecution.
The compromise penalties shall be collected and accounted for under the usual procedures as internal revenue collection.
The violation shall be referred to the appropriate office for criminal action.
No. The Order expressly states that it shall not prevent the Commissioner or his duly authorized representative from accepting a compromise amount higher than what is provided in the schedule.
Yes, but it requires approval by the Commissioner of Internal Revenue or the concerned Deputy Commissioner/Assistant Commissioner/Regional Director.
Because those acts commonly resorted to by taxpayers as means of tax evasion have met the requirements of the definition of fraudulent acts.
It takes effect immediately.
It revokes or repeals all other orders inconsistent with RMO No. 7-2015.
They must apply the Revised Schedule of Compromise Penalties embodied in the annex to ensure uniformity of action.