BIR issued RMC No. 8-2026 to resume audit and related field operations following the completion of review of audit policies, procedures and internal control mechanisms. The resumption of tax audit and related field operations shall cover, but shall not be limited to, the following activities:

  • Issuance of Electronic Letters of Authority (eLAs), Mission Orders (MOs), and Tax Verification Notices (TVNs);
  • Continuation and completion of audit cases previously suspended pursuant to RMC No. 107-2025;
  • Enforcement, verification, assessment, and collection activities requiring audit or field operations; and
  • Other audit or enforcement activities necessary to protect revenue or enforce compliance, subject to applicable issuances and the controls set forth in RMO No. 1-2026.

RMC No. 8-2026 shall take effect immediately.

Furthermore, BIR also issued RMO No. 1-2026 to introduce a reformed audit program with new policies and procedures for audits & assessments going forward. Its reforms aim to make audits more objective, transparent, and standardized — addressing longstanding concerns over overlapping audits, lack of procedural clarity, and discretionary issuance of audit authorities. Key features include:

  1. One Audit Per Taxpayer Per Year
  • Generally only one eLA is issued per taxpayer per taxable year covering all internal revenue tax types (e.g., income tax, VAT, withholding taxes).
  • Taxpayers with multiple pending LOAs can request consolidation.
  1. Risk-based, Data-driven Selection
  • Taxpayers selected for audit will be drawn from system-assisted, risk-based criteria rather than subjective or manual selection.
  • Includes mandatory cases such as significant discrepancies in reporting or anomalous tax filing behavior.
  1. Abolition / Rationalization of Units
  • Audit task forces are abolished; functions revert to regular BIR offices.
  • Special VAT audit units (e.g., VATAS and LT-VAU) are closed to avoid overlapping authority and improve accountability.
  1. Stronger Rules Against Unreasonable Assessments
  • Revenue officers can no longer issue assessments without: Proper factual basis, Legal justification, Citation of applicable laws and jurisprudence.
  • This addresses historic concerns about arbitrary or “made-up” assessments.
  1. Standardization Documentation
  • Mandatory audit checklists and signed minutes of audit interactions (with both taxpayer and auditor signatures) are required.
  • This ensures a clear paper trail of audit conduct.
  1. Flexible Handling of Records
  • Taxpayers now have reasonable options when providing voluminous records — helping reduce disruption to business operations.

Here are the deadlines and timeframes that taxpayers should take note of under BIR’s RMO:

  1. If a taxpayer wants to opt out of the automatic consolidation of multiple electronic Letters of Authority (eLAs) for the same taxable year, they must file a written request for non-consolidation with the BIR office handling the audit on or before February 16, 2026.
  2. If no valid written request is filed by the above deadline, then starting March 4,2026, all pending eLAs covering the same taxpayer and taxable year will be automatically consolidated into one authority.
  3. Both the taxpayer and the assigned revenue officers have up to April 30, 2026 to close audit cases under the old separate eLAs. After May 4, 2026, any unresolved cases will be treated as consolidated automatically, regardless of the audit stage or whether a request was filed.
  4. Units such as VAT Audit Sections (VATAS) and Large Taxpayers VAT Audit Units (LTVAUs) will wind up operations by May 15, 2026 as part of aligning with the new single-instance framework.

The BIR likewise issued “Annex A” of the RMO (see attached), which outlines the objective, system-defined risk parameters used for taxpayer selection for audit. A more comprehensive procedure covering taxpayer selection, case assignment, and the issuance of electronic Letters of Authority (eLAs) is set to be implemented on or before April 16, 2026.

Practical Guidance for Taxpayers and Practitioners

  • Proactively review all existing and pending LOAs/eLAs to determine their treatment under the single-instance audit and consolidation rules introduced by RMO No. 1-2026, and assess whether any action is required.
  • Conduct an internal readiness check of books, records, and supporting schedules, in anticipation of the resumption of tax audits under the BIR’s revised audit and assessment procedures.
  • Gain a working understanding of the BIR’s risk-based, system-generated audit selection parameters, as these may affect audit exposure and help identify areas where compliance controls may need to be strengthened.