Overview of Tax Amnesty Provisions and Availing of Its Benefits

Estate Tax Amnesty

• Coverage: Estate taxes of deceased who died on or before 31 December 2017
• Rate: 6% of the decedent’s total net estate at the time of death
• Benefits: Immunity from all estate taxes and additions and from resulting civil, criminal, and administrative cases and penalties under the Tax Code for 2017 and prior years
• Note:
  • If an estate tax return was previously filed with the Bureau of Internal Revenue (“BIR”), ETA shall be based on the net undeclared estate

Tax Amnesty on Delinquencies (“TAD”)

• Coverage: National internal revenue taxes, including income tax, withholding tax, capital  gains tax, donor’s tax, value-added tax, other percentage taxes, excise tax, and documentary stamp tax collected by the BIR and value-added taxes and excise taxes collected by the Bureau of Customs for taxable year 2017 and prior years
• Who May Avail:
  • Final assessments, where the application for compromise has been requested on the basis of (i) doubtful validity of the assessment, or (ii) financial incapacity of the taxpayer, but the same was denied on or before the effectivity of the Implementing Rules and Regulations (“IRR”)
  • Pending criminal cases for tax evasion and other tax offenses
  • Tax cases subject of final court judgment on or before the effectivity of the IRR;
  • Withholding agents who withheld taxes but failed to remit to BIR
    Rate: Applied to the basic tax assess
• Final assessments, where the application for compromise has been requested on the basis of (i) doubtful validity of the assessment, or (ii) financial incapacity of the taxpayer, but the same was denied on or before the effectivity of the Implementing Rules and Regulations (“IRR”)
• Pending criminal cases for tax evasion and other tax offenses
• Tax cases subject of final court judgment on or before the effectivity of the IRR;
• Withholding agents who withheld taxes but failed to remit to BIR
• Rate: Applied to the basic tax assessed  

• Benefits: Tax delinquency shall be considered settled, cases shall be terminated, and immunity from investigations, suits or actions including civil, criminal, and administrative cases that relate to taxes covered by the TAD  

Confidentiality

• Information and data contained in, derived from or provided by a taxpayer in a tax amnesty return, and appurtenant documents shall be confidential and shall not be used in any investigation or prosecution before the government
• Prior submission by the taxpayer to the BIR are deemed amended by submissions filed pursuant to the tax amnesty act