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Client Bulletin No. 27 (Updates on COVID-19 related PH Issuances): Recent Issuances by the IPOPHL and the BIR  

by Carina Laforteza, Vida Panganiban-Alindogan

Published: July, 2020

Submission: August, 2020

 



This is a briefing on the issuances as of July 22, 2020 on the following matters in relation to the COVID-19 pandemic:


A. Intellectual Property Office (IPOPHL) Suspends Services at its Main Office from July 20 to 27, and Extends Deadlines


B. BIR Amends Reportorial Requirements of Banks and Other Lenders that Granted a Grace Period on Loans that were due during the Enhanced Community Quarantine


C. New Bureau of Internal Revenue (BIR) Form for Related Party Transactions


 


A. Intellectual Property Office (IPOPHL) Suspends Services at its Main Office from July 20 to 27, and Extends Deadlines


The IPOPHL has issued IPOPHL Memorandum Circular No. 2020-028 (Suspension of Activities and Extension of Deadlines for the Period of 20 to 27 July 2020) dated July 18, 2020, 1 which suspends all activities at the IPOPHL Main Office from July 20 to July 24, 2020 “except for cashiering and documentary receiving services, which shall remain suspended until [July 27, 2020].”


The circular provides that “[d]eadlines for filings and payments falling due during [the period of July 20 to 27] are extended until [August 4, 2020]” since personnel from the cashiering and receiving sections of the IPOPHL are unavailable for that period. In the meantime, “[t]he public is encouraged to transact business with IPOPHL through its online portal which shall remain available.”


The circular was issued after one of the IPOPHL personnel tested positive for COVID-19. Persons who visited the IPOPHL Main Office on July 13, 2020 “are advised to undergo the necessary safety precautions and monitor their health.”


For more information about IPOPHL issuances, please contact:


Vida M. Panganiban-Alindogan Partner;
Head of the Intellectual Property Department
[email protected]


 


B. BIR Amends Reportorial Requirements of Banks and Other Lenders that Granted a Grace Period on Loans that were due during the Enhanced Community Quarantine


The BIR has issued Revenue Memorandum Circular (RMC) No. 72-2020 (Amending Revenue Memorandum No. 36-2020) dated July 17, 20202 to “remove the requirement of submission of photocopies of documents evidencing credit extensions and credit restructuring granted by covered institutions during the Enhanced Community Quarantine (ECQ).” Covered institutions, including banks, financing companies, lending companies, and other public and private financial institutions, that had loans that fell due during the ECQ were required by Republic Act No. 11469 or the “Bayanihan to Heal As One Act” to grant a grace period on loan payments.


RMC No. 72-2020 amends RMC No. 36-2020 (Further Clarification on the Exemption from Documentary Stamp Tax (DST) Relief for Qualified Loans pursuant to Revenue Regulations No. 8-2020 dated April 1, 2020 and Revenue Memorandum Circular No. 35-2020 dated April 2, 2020) dated April 3, 2020.3


This new RMC requires covered institutions to submit a “Summary Listing of Pre-Existing Loans, Pledges and Other Instruments with Granted Extension of Payment and/or Maturity Periods as of March 17, 2020,” without needing to attach “photocopies of documents evidencing credit extensions and credit restructuring,” to the “Revenue District Office / Large Taxpayers Service / Large Taxpayers District Office where the taxpayer is registered” within 60 days from the lifting of the ECQ. The summary listing “shall be made under oath as to the completeness, truth and accuracy thereof by a duly authorized officer or representative of the taxpayer, and subject to post audit/verification by the BIR whether the summary list pertains to qualified loans only.”


C. New Bureau of Internal Revenue (BIR) Form for Related Party Transactions4


The Secretary of Finance has issued Revenue Regulations (RR) No. 19-2020 (New BIR Form No. 1709, Replacing Form No. 1702H, Series of 1992) dated July 8, 20205 to prescribe the use of the new BIR Form No. 1709 or Information Return on Related Party Transactions (Domestic and Foreign), replacing “BIR Form No. 1702H - Information Return on Transactions with Related Foreign Persons, series of 1992.” The new form is Annex A of the RR and can be downloaded at


https://www.bir.gov.ph/images/bir_files/internal_communications_1/Full%20Text%20RR%20202 0/RR%20No.19-2020%20Annex%20A.pdf


BIR Form No. 1709 is required to be attached to the “Annual [Income Tax Return] for the current taxable year and subsequent years.”


RR No. 19-2020 sets out the rules “in determining whether a person or entity is a related party,” enumerates the required “disclosures on transactions and outstanding balances,” and provides the procedure and guidelines in accomplishing the new form.


This issuance will take effect on July 25, 15 days following its publication on July 10, 2020 in the Malaya Business Insight, a newspaper of general circulation.


For more information about BIR issuances, please contact:


Carina C. Laforteza Partner;
Head of the Tax Department
[email protected]


 


 


Footnotes:

1 IPOPHL Memorandum Circular No. 2020-028; https://drive.google.com/file/d/1HvAyD7OrjYAP67_j_PfsttBAMyWqoOfl/view; last visited July 20, 2020 at 6:22 AM.


2 BIR Revenue Memorandum Circular No. 72-2020; https://www.bir.gov.ph/images/bir_files/internal_communications_2/RMCs/2020%20RMCs/RMC%20No. %2072-2020.pdf; last visited July 21, 2020 at 2:20 PM.


3 BIR Revenue Memorandum Circular No. 36-2020; https://www.bir.gov.ph/images/bir_files/internal_communications_2/RMCs/2020%20RMCs/RMC%20No. %2036-2020.pdf; last visited July 21, 2020 at 2:30 PM.


4 This is not a COVID-19 related issuance but we have included it in this bulletin to update our clients.


5 BIR Revenue Regulations 19-2020; https://www.bir.gov.ph/images/bir_files/internal_communications_1/Full%20Text%20RR%202020/RR%20 No.%2019-2020.pdf; last visited July 20, 2020 at 12:30 PM.


 

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