Decline in banking M&A is a fundamental shift, not just a cyclical downturn

In this issue

  • Decline in banking M&A is a fundamental shift, not just a cyclical downturn

  • Cautiously optimistic – a challenging year ahead for miners: PwC report

Bureau of Internal Revenue (BIR)

  • Amended definition of the term “fair market value” of unlisted shares (RR No. 6-2013 dated 11 April 2013)
  • Tax treatment of sale of jewelry, gold and other metallic minerals to a nonresident alien individual not engaged in trade or business in the Philippines or to a nonresident
    foreign corporation (RR No. 5-2013 dated 21 March 2013)
  • Revised guidelines and procedures in the issuance of Subpoena Duces Tecum (SDT) and prosecution of related cases for non-compliance (RMO No. 10-2013 dated 22 April 2013)
  • Policies, guidelines and procedures implementing the Mobile Revenue Collection Officers System (MRCOS) (RMO No. 8-2013 dated 27 March 2013)
  • Guidelines prescribing the endorsement of fraud cases discovered in the processing and issuance of CARs and TCLs (RMO No. 7-2013 dated 12 March 2013)
  • Guidelines on taxation of compensation income of Philippine nationals and alien individuals employed by foreign governments/embassies/diplomatic missions and
    international organizations situated in the Philippines (RMC No. 31-2013 dated 12 April 2013)
  • Strict implementation of the electronic filing of tax returns and electronic payment of taxes under RR No. 9-2011 (RMC No. 30-2013 dated 1 April 2013)
  • Filipino employees of the Asian Development Bank are not entitled to the 15% tax provided under Section 25(C) of the NIRC (BIR ITAD Ruling No. 113-2013 dated 15 April 2013)
  • Installation of substantial equipment in the Philippines by a Malaysian resident is deemed a PE under the RP-Malaysia Tax Treaty (BIR ITAD Ruling No. 098-2013 dated 8 April 2013)
  • Accumulated and unapplied input VAT arising from zerorated transactions may be treated as deductible expense for income tax purposes only in cases of denied claim for
    refund or tax credit (BIR Ruling No. 133-2013 dated 4 April 2013)
  • The conduct of a short workshop in the Philippines by a US company does not create a PE in the Philippines under the RP-US Tax Treaty (BIR Ruling ITAD No. 076-13 dated 21 March 2013)
  • Remuneration paid to a foreign teacher is exempt from Philippine income tax under the RP-Vietnam Tax Treaty (BIR Ruling ITAD No. 070-13 dated 14 March 2013)
  • Service fees for acting as joint arrangers and agents of loan are considered business profits under RP-Japan Tax Treaty (BIR Ruling ITAD No. 053-13 dated 8 March 2013)

Court decisions

  • Incidental transactions, though isolated, may still be subject to 12% VAT (G.R. Nos. 193301 and 194637 dated 11 March 2013)
  • Filing of claim for refund of excess input VAT is governed by Section 112(A) and (C) and not Section 229 of the NIRC; “Excess” input VAT is not “excessively” collected tax (G.R. Nos. 187485, 196113, 197156 dated 12 February 2013)
  • The two-year prescriptive period refers to administrative claim for refund and not judicial claim; the 30-day period to appeal to the CTA need not necessarily fall within that
    2-year prescriptive period (G.R. Nos. 187485, 196113, 197156 dated 12 February 2013)
  • Observation of 120+30 day rule to file judicial claim is mandatory and jurisdictional (G.R. Nos. 187485, 196113, 197156 dated 12 February 2013)
  • Exception to the 120-30 day rule (G.R. Nos. 187485, 196113, 197156 dated 12 February 2013)
  • Premature filing of a claim for refund or the nonexhaustion of administrative remedies is not jurisdictional and, at the most, only renders the case susceptible of dismissal for lack of cause of action and such defense is waivable (CTA Case No. 7896 dated 22 February 2013)
  • Period to assess and collect local taxes should be made within five years from the date they become due (CTA Case AC No. 84 dated 1 March 2013)

Executive issuances

  • Transition to new and amended Philippine Financial Reporting Standards (SEC Memorandum Circular No. 6 Series of 2013 issued 23 April 2013)
  • Amendments to Foreign Exchange Regulations (BSP Circular No. 794 series of 2013 dated 18 April 2013)
  • Amendment aligning the familial restrictions applicable to independent directors of banks and non-bank financial institutions with the existing provision of the SRC (BSP Circular No. 793 Series of 2013 dated 8 April 2013)
  • Guidelines on voluntary payment of contributions for members 65 years old or over with less than 120 monthly contributions (SSS Circular No. 2013-003 effective 1 April 2013)