Tax Alert No. 2 [Revenue Memorandum Circular No. 141-2019 dated 20 December 2019]

Circularizing the Salient Points from Revenue Memorandum Order (RMO) No. 14-16 on the Proper Execution of Waivers of the Defense of Prescription and an Illustration of the Basic Requirements thereof

The Commissioner of Internal Revenue has issued Revenue Memorandum Circular (RMC) No. 141-2019 dated 20 December 2019, reiterating the salient provisions of RMO No. 14-16 which prescribes the guidelines for the execution of Waivers of the Defense of Prescription pursuant to Section 222 of the National Internal Revenue Code, as amended.

Salient provisions of the RMC are as follows:

1. The Waiver is a unilateral and voluntary undertaking which takes legal effect on the taxpayer immediately upon execution
2. The Waiver need not specify the taxes to be assessed nor the amount thereof.
3. The delegation of authority to a representative need not be in writing and notarized.
4. The taxpayer cannot invalidate the Waiver by contesting the authority of his own representative.
5. The taxpayer shall submit his Waiver to the officials prior to the expiration of the period to assess or to collect.
6. The Revenue District Officer or Group Supervisor designated in the Letter of Authority or Memorandum of Assignment can accept the Waiver.
7. The date of acceptance by the BIR Officer is no longer required to be indicated.
8. The taxpayer shall retain a copy of the submitted Waiver.
9. Notarization of the Waiver is not a requirement for its validity.
10. The taxpayer must ensure that his Waiver:
    • Is executed before the expiration of the period to assess or to collect taxes;
    • Indicates the expiry date of the extended period;
    • Indicates the type of tax (for waiver of the prescriptive period to collect); and
    • Is signed by his authorized representative.
11. There is no strict format for the Waiver. The taxpayer may utilize any form with no effect on its validity.

An illustration of the key elements of the Waiver is in Annex A of RMO No. 14-16.

You may access the full version of the RMC through the BIR website.