On 13 June 2019, the Bureau of Internal Revenue (BIR) issued Revenue Regulations No. 7-2019 ("RR 7-2019") providing for qualifications on who are considered as top withholding agents.
Under RR 7-2019, top withholding agents are those taxpayers whose gross sales/receipts or gross purchases or claimed deductible itemized expenses, as the case may be, amount to TWELVE MILLION PESOS (PHP12,000,000.00) during the preceding taxable year.
RR 7-2019 also provides that taxpayers who are classified as top withholding agents before its effectivity shall remain as such until failure to satisfy the aforementioned criteria and duly published as delisted from the existing list of top withholding agents.
If the taxpayer qualifies as a top withholding agent, the income payments it will make shall be subject to 1% in case of supplier of goods and 2% in case of supplier of services. Take note that failure to subject income payments to these suppliers shall be disallowed as a deductible expense.
Disclaimer: This article is for general information only and is not intended nor is to be construed as a substitute for legal advice on any specific matter. A professional legal advice is still necessary to an actual or particular issue.