BIR has issued on April 4, 2016 RMO No. 14-2016 modifying and/or repealing accordingly the provisions of RMO No. 20-90 dated April 4, 1990 relative to the waiver of the defense of prescription under the statute of limitations.
It has been an extensive practice by taxpayers to contest the validity of their waivers under the statute of limitations after having availed of the benefits thereof. Thus, the following revised procedures are necessary:
- The waiver may not be necessarily in the form prescribed by RMO 20-90 or RDAO 05-01, provided that certain conditions are complied with: (1) waiver is executed before the expiration of the period to assess or to collect taxes; (2) waiver is signed by the taxpayer himself or his duly authorized representative, or by any of the responsible officials for corporations; and, (3) expiry date of the period agreed upon to assess or to collect taxes is indicated.
- Except for waiver of collection of taxes, the waiver need not specify the particular taxes to be assessed nor the amount thereof;
- Taxpayer is charged with the burden of ensuring that the waiver is validly executed by its authorized representative. The authority of the taxpayer’s representative who participated in the conduct of audit or investigation shall not be thereafter contested to invalidate the waiver;
- The waiver may be notarized;
- The waiver shall take legal effect and be binding on the taxpayer upon its execution thereof;
- The Commissioner’s authorized representative as prescribed in existing regulations, the revenue district officer, or the group supervisor as designated in the Letter of Authority shall signify acceptance of the taxpayer’s duly executed waiver prior to the expiration of the period to assess or to collect;
- There are only two dates that need to be present on the waiver, to be valid, such as (1) the date of execution, and (2) the expiry date of the period the taxpayer waives the statute of limitations; and,
- The period may be extended by subsequent written waiver made in accordance with this Order before the expiration of the period set on the previously executed waiver.