Verification and Evaluation of Credit Applicants
The consistency of information contained in the ITR and financial statements is to be checked and factored into assessing the financial capacity and creditworthiness of loan applicants and their co-makers.
- Data consistency in submitted tax and financial documents is critical.
- Evaluation of creditworthiness includes thorough verification of submitted documents.
Objectives of the Regulations
The rules aim to:
- Establish a system enabling banks to ensure only tax-compliant individuals may apply for credit, or act as co-makers, endorsers, sureties, or guarantors.
- Simplify compliance by providing convenient procedures for submitting required documents.
- Guarantee the authenticity of the submitted ITRs and financial statements.
Key Definitions
Electronic Filing and Payment System (EFPS): An internet-based BIR system for paperless filing, tax payment, and submission of financial documents.
Latest Income Tax Return: Refers to the most recent annual ITR or, for new businesses without annual returns, the latest quarterly ITR.
Financial Statements: Include balance sheets, income statements, equity changes, and cash flow statements with notes. For taxpayers with assets over ₱15 million, externally audited statements by SEC-accredited auditors are required.
EFPS enables electronic filing and payment.
Latest ITR depends on business status; annual or quarterly accordingly.
Financial statements must be complete and, for larger enterprises, externally audited.
Electronic Filing to Facilitate Verification
Applicants are urged to file ITRs and financial statements electronically via EFPS for easier verification. Documents filed through EFPS or authorized agents (AABs) bearing reference numbers are considered duly stamped by the BIR. Applicants may download copies of filed returns from the BIR portal.
- Electronic filing is strongly encouraged for convenience.
- EFPS submissions are deemed officially received.
- Banks can verify EFPS-filed documents through BIR online or contact centers.
Authentication Procedures for Submitted Documents
ITRs submitted through EFPS can be verified by phone or through the BIR portal. Non-EFPS returns require faxing a verification request with relevant bank and applicant details to the BIR Contact Center, which coordinates with the appropriate regional office and responds accordingly.
Financial statements must be filed and paid either electronically or manually. To confirm authenticity, banks must fax a verification request with all necessary data to the BIR Contact Center.
- EFPS ITRs verified by phone or online portal.
- Non-EFPS ITRs verified via fax request and official BIR channels.
- Financial statements verification requires fax request including applicant details and revenues.
Effectivity of Regulations
These regulations became effective fifteen (15) days after their publication in a newspaper of general circulation, signifying mandatory compliance thereafter.
- Regulations effective 15 days post-publication.
- Mandatory adherence for all credit applicants and financial institutions.