FORCAY OF INTERNAL REVENUE REPUBLIC OF THE PHILIDPINES RE DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE, JAN fy 2a per RUCK igs November 20, 2017 SUBJECT : 12 Revecue Regulations (RR) No. 12-2013 Thereby Reinstating the Provisions ‘of Setion 2.58.5 oF RE No, 14.2002, as Amended by RR No 17-2003, 10 All Withholding Agents, Internal Revenue OMfieers, Employees and Od Concerned. SECTION 1, SCOPE. Pursuart othe provisions of Section 244, in relation 1 Section 34K) ‘of tie National Inceraal Reveaue Code of 1997 as ainended. these regulations ate hereby promulgate to revoke RR No, 122013, relate to the requiremenss for deducbilty of certain expenses, thereby the provisions of Savion 2.8K of RR No, 14-2002, as amtended by RR No, 17.2003 SECTION 2, REQUKEMENTS FOR DEDUCTIBILITY OF CERTAIN EXPENSES. - RR No, 12-2013 fs hereby revohed in effect, rinsing the provisions stated under RR No, 14-2002, as amends by RR No, 17-2003 read flows: “Sec. 2.68.5. Requirements for Deductibity: ~ Any income payment which cthersise deductible under the Code shall bo allowed asa deduction ftom the ayor's 086 ‘income only if 8 shew tht the income tax reouired 10 be withheld has been pid tothe Bureau in aceordanes with Sees. $7 and $8 of the Code A deduction wllalio be ellowed in the following cases wher no withholding oftax vos made (A) The payee reported the income and pass tho tax du thereon ond the withhaling gent pays the x incucing the interest incident the failure to wihold the tay, and surcharges, if apgligble, atthe time of the audinvestigation or reinvestigaionreconsideraion, (B) The recpiemipayee failed! wo report the income on the due date thereof, but the withholding agenctaxpiyer pays the ix. including the interest incident to the fale to withhold the tax, ard surcharges, If applicable, at the time of audivinvestigation or reinvesgation/recomiderstion (C.) The withholding agen eroncouslsunderwihels the 1as but pays the difference between the coret meu and the amount oF ax withheld including the interest, nce to Such eos, and sureiurgs. if applicable. at the time of the audivinvesigaion orHems oF deduction representing return of capital such as those pertaining to purchases of raw materials forming part of finished product or purchases of goods for resale, shall be allowed as deductions upon withholding agent's payment of the basie withholding tax and penalties incident to non-withholding or underwithholding.” SECTION 3. REPEALING CLAU issuances or parts thereol’ which are ineonsist revoked or amended accordingly. = All enisti 1 With the provi rules and regulations or any revenue ns of these Regulations are hereby TION 4, EFFECTIVITY, ~ These Rey, following publica jons shall take effect afier fifteen (13) days n in any newspaper of general circulation. CARLOS G. pominWurz etary of Finance ad “JANOS 2008 Recommending Approval: DUREAL OF ‘an op JR On ecm RECORDS CAESAR R.DULAY isi f a g oe Commissioner of Internal Revenue ante RECEI ie