There is some great news for companies registered in the Philippines. The Bureau of Internal Revenue (BIR) is finally implementing its Electronic Filling and Payment System (EFPS). This new system offers the possibility for tax payers to file its tax report and respective payment online, drastically reducing the number of hours spent on this process.
Unfortunately, due to the high volume of demand, the BIR is for now only accepting certain types of companies for this sort of accreditation.
The following companies are mandated to register and use eFPS:
- Taxpayer Account Management Program (TAMP)
- Accredited Imported and prospective importer required to secure the BIR-ICC and BOC-AMO accreditation
- The National Government Agencies
- All licenses local contractors
- Enterprises enjoying tax incentives (PEZA, BOI, other zone authorities)
- Top 5,000 Individual tax payers
- Corporation with Paid-Up capital stock of P10 million and above
- Corporation with complete computerized accounting system
- Procuring agencies with respect to Withholding of VAT and Percentage Taxes
- Government Bidder
- Insurance companies and stock broker
- Large tax payers
- Top 20,000 Private corporation
Once registered with the eFPS, the following procedures must be
- At the end of every month, companies should prepare the month end closing and prepare the necessary forms
- Submit all the forms for BIR assessment. This will be done using the EFPS online platform
- BIR will then notify the company bank and the bank will request for the company confirmation of payment
- As soon as it is approved, the payment to BIR will be executed. The payment must be done on the 10 and 21 of each month
This system defiantly allows companies not to interact with the BIR on a regular basis and save time in transaction.
Obtaining this certification is not an easy process
This system sounds pretty simple and straight forward to put in place, however, part of this process will require some adaptation.
The main difficulty a company will face in processing this registration is to use a bank actually accredited and able to work with the BIR on this system. For now, as this is a new procedure, not all local banks are mandated to comply. Thus, if a company is willing to enroll with eFPS but its bank is not offering the eFPS system, the company will be force to open a bank account with an accredited bank. This is definitely a very negative aspect for any organization facing this situation.
Aside from that, foreign corporations will be required to secure authorization from their parent company. This can done by virtue of a Board Resolution and must be duly authenticated by the Embassy of the Philippines in the respective country.
But you need to do it now!
It is important to remind all tax payers’ falling under the list above that the BIR is requesting them to comply right now. If your company fails to comply, the BIR might just refuse the filling and payment, which will result in the imposition of penalties.
With a team of experienced Certified Public Accountants and Tax experts, we have assisted several companies in enjoying this new system and to comply with its strict requirements. Please contact us for more details and assistance.