No surcharge on deficient tax amounts in relation to timely filed and paid taxes but with additional taxes to be paid (EWT, VAT, DST, etc.)

Bureau of Internal Revenue (BIR) issued Revenue Memorandum Circular (RMC) No. 43-2022 last
April 08, 2022 to end the confusion of the taxpayer with the previous RMC No. 54-2018 and RMC No. 46-99. RMC No. 54-2018 states that a 25% surcharge is imposed on the additional tax to be paid per amended return. On the other hand, no 25% surcharge shall be imposed in RMC No. 46-99 in computing tax deficiency as a result of the tax audit.

The RMC reiterated Section 248(A) of the Tax Code which states that the following are subject to a 25% surcharge:

1. Failure to file any return and pay the tax due on the date prescribed;
2. Filing a return with an internal revenue officer other than those with whom the return is required to be filed, unless authorized by the Commissioner;
3. Failure to pay the deficiency tax within the time prescribed for its payment in the notice of assessments; or
4. Failure to pay the full or part of the amount of tax shown on any return, or the full amount of the tax due for which no return is required to be filed, on or before the prescribed for its payment.

Hence, the 25% surcharge on amended returns will not be imposed on taxpayers that were able to file the initial tax return on or before the due date of its filing. On the other hand, if the tax return under audit was later found to be filed beyond the prescribed period or due date, the 25% surcharge will be applicable and will be added to the tax deficiency discovered during the audit.

For everyone’s guidance and perusal. 

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