Legal basis and covered authorization
- Section 1 grounds the issuance on Section 244 of the Tax Code of 1997, as amended, in relation to Section (H) of the same Code.
- Section 1 authorizes the Commissioner of Internal Revenue to prescribe additional procedural and/or documentary requirements connected with the preparation and submission of financial statements accompanying tax returns.
Purpose of the amendments
- Revenue Regulations No. 15-2010 amends specific provisions of Revenue Regulations No. 21-2002 that govern how taxpayers comply with documentary and/or procedural requirements for financial statements submitted with tax returns (Section 1).
- The amendment focuses on expanding the mandatory content of the Notes to Financial Statements related to taxes, duties, and license fees.
Amendment to Notes to Financial Statements content
Section 2 amends Section 2(e) of Revenue Regulations No. 21-2002 by inserting required disclosures into the Notes to Financial Statements.
The Notes must include information on taxes, duties and license fees paid or accrued during the taxable year, including the following items.
The Notes to Financial Statements must disclose:
- (1) VAT output tax declared during the year, with the account title and the amount/s on which it was based; if there are zero-rated sales/receipts and/or exempt sales/receipts, the Notes must state that fact and the legal basis therefor.
- (2) VAT input taxes claimed, broken down into:
- (a) Beginning of the year;
- (b) Current year domestic purchases/payments for:
- (i) Goods for resale/manufacture or further processing
- (ii) Goods other than for resale or manufacture
- (iii) Capital goods subject to amortization
- (iv) Capital goods not subject to amortization
- (v) Services lodged under cost of goods sold
- (vi) Services lodged under other accounts
- (c) Claims for tax credit/refund and other adjustments; and
- (d) Balance at the end of the year.
- (3) Landed cost of imports and the customs duties and tariff fees paid or accrued thereon.
- (4) Excise tax/es classified per major product category (i.e., tobacco products, alcohol products, automobiles, minerals, oil and petroleum, etc.) paid on:
- (a) Locally produced excisable items; and
- (b) Imported excisable items.
- (5) Documentary stamp tax (DST) on loan instruments, shares of stock and other transactions subject thereto.
- (6) All other taxes, local and national, including real estate taxes and license and permit fees, lodged under the Taxes and Licenses account both under the Cost of Sales and Operating Expenses Accounts.
- (7) Withholding taxes, categorized into:
- (i) Tax on compensation and benefits
- (ii) Creditable withholding tax/es
- (iii) Final withholding tax/es
- (8) Periods covered and amount/s of deficiency tax assessments, whether protested or not.
- (9) Tax cases and amounts involved under preliminary investigation, litigation and/or prosecution, whether in courts or bodies outside the BIR.
Repeal and modification of inconsistent rules
- Section 3 provides a repealing clause that modifies, repeals, or revokes inconsistent rules, regulations, and other issuances or portions thereof.
- Section 3 expressly includes revocation of the submission of a separate Schedule of Taxes and Licenses.
Rejection, deadline, and timing for compliance
- These Regulations’ effectivity is fifteen (15) days after complete publication in a newspaper of general circulation in the Philippines (Section 4).
- All amendments to the financial-statement disclosure requirements become operative as of that effectivity date (Section 4).