Subject: BIR Form 2307/Expanded Withholding Tax/Certificate of Creditable Tax Withheld at Source

Reminder to Request/Demand for 2307s before it’s Too Late

To all the taxpayers who are the sellers/income earners:

Your Top Withholding Agent – customers/clients should issue a Certificate of Creditable Tax Withheld at Source (BIR Form No. 2307) to your company that is subjected to withholding, every 20th day following the close of the taxable quarter or upon your request.

Bases:  Section 2.58 (B), RR 2-98

If customers/clients shall issue you your 2307s only at the time of your collection, it may be that the date indicated in the certificate is a date beyond the calendar year/period which will make it without value to you because such form/tax credits can only be used in the year/period applicable.  Thus, it is recommended that you request/demand “early on” said 2307s. Best is to arrange with them to issue the same upon their accrual; anyway, they should have filed/paid those expanded withholding taxes on or before due date on the basis of their accrual, payment, or when payable, whichever is earlier. Close monitoring and coordination of these certificates is helpful specially because these are effectively your income taxes paid in advance by your customers/clients to the BIR on your behalf, being the income earner.  You have the right to demand for the said certificate.

If the customer/client finds it difficult to prepare the said certificates, you may opt to make it/such for them and them to readily sign and issue you. This is not the best process as the act of issuance is their responsibility; but, once not executed, the financial impact shall be on you.

Author:  Raymund J. Manaig, CPA MBA

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The author is a partner of Manaig, Manaig & Co., CPAs located at Laguna-Philippines (MM&Co., CPAs), a member-firm of IECnet an international association of accountants, auditors and tax practitioners. Our website is https://mmco.com.ph. Our eLearning link for our seminars is: https://mmco.com.ph/elearning   

The article is for general information only and is not intended, nor should be construed as a substitute for tax, legal or financial advice on any specific matter. We recommend that you seek professional advice to complete the study of the applicability of this article to any actual or particular tax or legal issue to address your/your company’s specific needs or in your advisory services to your clients.  

If you have any comments or questions concerning the article/blog, you may e-mail the author at manaig.rj@gmail.com or call (02) 8330-6057 or (0917) 623-9460