SyCipLaw's Top 10 Tax Issues And Practical Solutions (T.I.P.S.) For 2022

February 2022

1. Filing of Requests for Confirmation, Tax Treaty Relief Applications, and Tax Sparing Applications Made Easy

In 2021, the BIR issued Revenue Memorandum Order (RMO) No. 14-2021 to streamline the procedures and requirements for the availment of tax treaty benefits. A prior application with the BIR for tax treaty relief is no longer required. Instead, withholding agents or income payors may apply the applicable tax treaty rates to income payments made to non-resident payees provided that they file with the BIR after the end of their taxable year a consolidated request for confirmation (RFC) of the applicability of such treaty rates. If, on the other hand, the withholding agent applies the regular rates under the Tax Code to income payments made to a non-resident payee, the latter may file a tax treaty relief application (TTRA) to confirm the payee's entitlement to tax treaty benefits if it wants to get a refund for the excess income taxes withheld.