[Ask the Tax Whiz] Updates on mandatory Creditable Withholding Tax refund

I am closing my business and applied for a tax credit. However, I only submitted scanned copies of the documentary requirements. Would it be a reason for the disallowance of my application for tax credit? 

No, as per Revenue Memorandum Circular 14-2025, it should not be a reason for disallowance. In today’s digital world, documents can be sent electronically via email, fax, mobile phones, or other technologies, not just by physical delivery. Therefore, the scanned copies of the required documents, like Bureau of Internal Revenue (BIR) Form 2307, should be valid for submission.

Additionally, during the verification process, the BIR checks the accuracy of the claimed BIR Form 2307 by comparing it with the Summary Alphalist of Withholding Agents (SAWT) submitted by the taxpayer. This is then cross-checked with the Alphalist of payees in the BIR Form 1604E or 1601E from the withholding agents. If everything matches, the BIR can confirm that the BIR Form 2307 is valid and authentic, making the question of whether it is an original copy irrelevant.

Can I file for an amendment of tax returns after filing for a claim of tax credit/refund or Electronic Letter of Authority (eLA) has been issued?

Once a tax credit or refund is submitted or an eLA is issued within the claim period, the taxpayer-claimant is no longer permitted to modify tax returns. After the application for income tax credit or refund is received by the BIR office and the verification procedure begins, only tax returns filed on or before the date of receipt of the application will be considered in the claim evaluation. 

To avoid complications or rejections, taxpayers must ensure their tax returns are accurate and complete before filing any claim for tax credit or refund. Inconsistent or amended tax returns may lead to partial disallowance or outright denial of the claim. 

As an individual taxpayer, are there any documentation requirements required for us to claim a tax credit or refund?

Yes, a new set of mandatory requirements is introduced for individual taxpayers who want to claim a tax credit or refund. Individual taxpayers can make claims under Section 58(E), which specifically refers to the income of the recipient in which any excess of the withheld tax over the tax due on the return shall be refunded to the taxpayer, subject to the provisions of Section 204.

While Section 76(C) of the Tax Code applies only to corporate taxpayers, the processing office(s) shall decide on the application and refund the excess taxes within two (2) years from the date of dissolution or cessation of business. This serves as an exception to the 180-day processing period for TCC/refund.

On the other hand, the general policies and procedures for both corporate and individual taxpayers (outlined in RMC 75-2024 and Revenue Memorandum Order 25-2024) remain unchanged.