Published: July 14, 2023
On June 22, 2023, the Bureau of Internal Revenue (BIR) issued Revenue Memorandum Circular No. 70-2023, which introduces significant changes regarding the list of Top Withholding Agents (TWAs). This circular aims to identify entities required to deduct and remit Creditable Withholding Tax (CWT) from their income payments to suppliers of goods and services. The changes are pursuant to Revenue Regulations (RR) No. 31-2020 and have been posted on the BIR’s official website. Starting July 1, 2023, the obligation to deduct and remit either one percent (1%) or two percent (2%) CWT will commence or cease, depending on an entity’s inclusion or deletion from the TWA list. This blog post will delve into the key aspects of Revenue Memorandum Circular No. 70-2023 and its implications for taxpayers.
What is Revenue Memorandum Circular No. 70-2023?
Revenue Memorandum Circular No. 70-2023 is an official directive issued by the Philippine Bureau of Internal Revenue. Its purpose is to inform taxpayers about changes made to the List of Top Withholding Agents (TWAs). These TWAs are obligated to deduct and remit Creditable Withholding Tax (CWT) from their payments to suppliers of goods and services, as mandated by Revenue Regulations (RR) No. 31-2020.
What are the Changes Introduced by RMC No. 70-2023?
The circular introduces an updated list of Top Withholding Agents, which includes new additions and deletions. Entities that have been newly listed as Top Withholding Agents will be required to deduct and remit either one percent (1%) or two percent (2%) CWT from their income payments to suppliers. On the other hand, entities that have been removed from the Top Withholding Agents list are relieved of this obligation.
How Will the Changes Affect Taxpayers?
Effective July 1, 2023, the obligation to deduct and remit CWT will be enforced or lifted for the entities affected by the changes. If a taxpayer finds themselves listed as a Top Withholding Agent, they must start deducting and remitting the specified CWT percentages from their payments to suppliers of goods and services. Conversely, if a taxpayer’s name is not included in the published List of Top Withholding Agents, they are no longer required to comply with the 1% or 2% CWT deduction and remittance under RR No. 31-2020.
Where to Find the List of TWAs?
The BIR has made the updated List of Top Withholding Agents available on their official website. Taxpayers can refer to this list to check if they are included as TWAs and ascertain their obligations accordingly.
Revenue Memorandum Circular No. 70-2023 is a vital update regarding the List of Top Withholding Agents (TWAs). The circular includes new additions and deletions, impacting the obligations of taxpayers to deduct and remit Creditable Withholding Tax (CWT) under RR No. 31-2020. Starting July 1, 2023, entities listed as TWAs must comply with the required CWT deductions and remittances, while those not listed are exempted from this obligation. To stay informed and check their status, taxpayers can access the published list on the BIR’s website. It is essential for taxpayers to be aware of these changes to avoid any potential penalties or non-compliance issues with the BIR.
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