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CM 308.1 - ISSUANCE OF TAX DELINQUENCY VERIFICATION (TDV)

Delinquency Verification is being undertaken by various offices in the BIR in the course of the discharge of their respective functions on matters that require determination of the extent of the level of tax compliance by any taxpayer with respect to the timely and correct payment if their tax liabilities.

The concerned RDO/LTS offices conduct delinquency verification in order to ensure that all the Bureau’s accounts receivables across the different offices at a certain point in time are duly accounted for, considering that there may be a lag time when the receivables are actually created at the RDO and Regional Assessment Divisions levels, and when the monthly updates of these accounts receivables/delinquent accounts are received by the LTCED/Regional Collection Divisions for posting in their respective AR/DA databases, and the CED for posting in the national database.

Delinquency verification is being requested by BIR-registered taxpayers, as well as non-resident foreign corporations and aliens not registered in the Philippines, who intend to join public bidding conducted by various government agencies.

Delinquency verification is also required by the TDM issuing offices[1] in the utilization and/or revalidation of Tax Credit Certificates. In this regard, these TDM-issuing offices request for verification of existence of outstanding tax liabilities of taxpayers applying for the issuance of Tax Debit Memos (TDMs), conversion of TCCs into cash refunds, and revalidation of TCCs[2], based on the AR/DA database maintained by the CED and the records of ARs/DAs of the concerned LTS/Regional Offices/RDOs where these taxpayers-applicants are registered.[3]

Other government agencies also request for verification of the tax compliance status of their clients. Among others, delinquency verification is required by the Commission of Appointments in the confirmation of the appointments of certain officials of the government, by the National Bureau of Investigation (NBI) for certain person with derogatory information, and by the Philippine National Police (PNP) as a pre-condition in the grant/renewal of the license to operate a private security agency.

Procedures in the Issuance of TDV

The RDO/LTDO/LTCED shall:

  1. Conduct verification of any outstanding tax liability of the taxpayer-applicant based on existing records in the RDO/LTDO/LTCED;
  2. Refer the application and its recommendation to the Regional Collection Division/LTS, for further verification within their area of jurisdiction; and
  3. Issue the delinquency verification certificate/notice of denial to the taxpayer, upon approval/disapproval thereof by the Regional Collection Division/LTS.

The Regional Collection Division/LTS shall:

  1. Receive the TDV application and the RDO/LTDO/LTCED recommendation thereon;
  2. Verify the existence of any outstanding tax liability of the taxpayer-applicant within their area of jurisdiction following the procedures indicated in CM 308 in the issuance of tax clearance;
  3. Route the application to the concerned regional offices for further verification of the existence of any AR/DA;
  4. Forward to CED, for further verification, all applications that are made for bidding purposes/utilization of Tax Credit Certificates for issuance of TDM; and
  5. Return the applications, whether approved or disapproved to the concerned RDO/LTDO/LTCED for issuance of the TDVF/Notice of Denial.

The CED shall follow the same procedures required in the processing of applications for tax clearance specified in CM 308 issuing TDVF for purposes of clearance for the utilization of Tax Credit Certificates.

 

[1] The TDM-issuing offices identified under RMC No. 01-2004 are:

  • The RDOs of RR No. 08-Makati- for their respective taxpayers
  • The LTDOs of Makati and Cebu- for their respective taxpayers
  • The LTCED- for LTAID I and LTAID II; and
  • The Collection Programs Division- for all other RDOs and Regional Offices.

[2] RR No. 5-2000.

[3] RMO No. 37-2011.