Republic Act No.

11976
Ease of Paying Taxes Act
(EOPT Act)
Date of signing into law: 05 Jan 2024 Date of Publication: 07 Jan 2024 Date of Effectivity: 22 Jan 2024

Classification of Taxpayers
(New provision)

Group Gross Sales

Micro Less than 3M Pesos

Small 3M Pesos to less than 20M Pesos

Medium 20MPesos to less than 1B Pesos

Large 1B Pesos and above

Returns and Payment of Taxes Income Tax

Repeal of Sec. 34 (K): Removal of

Paying and Filing of Taxes the rule of disallowance of expenses as
Anywhere; No surcharge deduction from gross income in case of
on wrong venue non-withholding.

In case taxpayer cannot carry over

Exemption from filing of the excess income tax credit due to
ITR for Overseas Contract cessation of business: Apply for
Worker & Overseas refund of unutilized excess income
Filipino Worker tax credit

Taxes Withheld at Source

Prior rules EOPT Act

Timing of withholding

Paid, Payable, Accrued Arises at the time

Whichever comes first Income has become payable

Claims for tax credits in a previous period

Can be credited in the subsequent calendar/fiscal year; Provided, the
revenue was declared in the tax return where the corresponding income is
reported.

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 Republic Act No. 11976
Ease of Paying Taxes Act
(EOPT Act)

Value Added Tax

Prior rules EOPT Act

VAT base of Sale of Service
Gross receipts Gross sales
VAT invoicing requirements

Goods Services Goods Services

Sales invoice Official receipt Sales invoice*

*effectively adopting accrual method for both sale of goods and service

Sales Allowances & Discounts for Sale of Service

No provision May be deducted from the gross sales

Simplified VAT Documentation Output VAT on Uncollected Receivables

Removal of the business After lapse of agreed period to pay

style requirement on the
Seller may deduct the output VAT on
invoices uncollected receivable from next
quarter’s output VAT, provided:
(1) Seller fully paid the VAT on the
Input VAT on Sales Invoice with
transaction; and
lacking information can still be (2) VAT component was not claimed as
claimed; provided the lacking allowable deduction
information do not pertain to:
(a) amount of sales;
(b) amount of VAT; In case of subsequent recovery
(c) name and TIN of both buyer and
seller;
Added to output VAT during
(d) description or nature of goods
or services ; and
period of recovery
(e) date of transaction

VAT refund claims are now classified into Period of Appeal in Case of VAT Refund:
LOW, MEDIUM, and HIGH-risk categories. 30 days from (a) receipt of decision
*facilitating fast processing for low-risk denying the claim OR (b) after the lapse of
claims; medium and high-risk claims shall be the 90-day period for the BIR to act on the
subject to audit or other verification processes.
claim.

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 Republic Act No. 11976
Ease of Paying Taxes Act
(EOPT Act)

Other Percentage Tax

Simplified computation of common carrier taxes: New taxable base: Gross Sales for (1) domestic carriers and
Removal of the minimum quarterly gross sales keepers of garages; (2) international carriers and franchise.
threshold domestic carriers and keepers of Amount billed for the overseas dispatch, message or
garages. conversation originating from the Philippines.

Remedies

The 2-year period to appeal to

the CTA was removed.
Filing for credit/refund with The Commissioner has 180
the CIR must be within 2 days to decide on a claim The appeal to the CTA must be
years after payment of the for refund of erroneously within 30 days from receipt of
tax or penalty. received taxes. denial (full or partial) or after
the expiration of the 180-day
period.

Compliance Requirements Special concessions for micro and small taxpayers

Preservation of Books: 5-year

5 retention/preservation of books
from the day following the
ITR form reduced from 4 pages to 2
pages, in paper or electronic form
years deadline/date of filing the return.

Registration/Updates can either be

made electronically or manually,
with the appropriate RDO. Reduced rate of 10% for Surcharge

Threshold for issuance of sales or

commercial invoice: P500; shall be
adjusted every 3 years 50% reduction on the interest rate

Removal of Annual Registration

Fee
A reduced compromise penalty rate
Digitalization of BIR Services: of at least 50%
Adoption of EOPT Digitalization
Roadmap and automated facilitating
system for registration, TIN
issuance and validation, filing of P500 for each failure to file an
returns and submission of information return, statement or list,
supporting documents and or keep any record, or supply any
information required
minimization of face-to-face
transactions.

This publication contains information in summary form and is therefore intended for general guidance only. It is not intended to be a substitute for detailed research or the exercise of professional
judgment. Neither SGV & Co. nor any other member of the global Ernst & Young organization can accept any responsibility for loss occasioned to any person acting or refraining from action as a
result of any material in this publication. On any specific matter, reference should be made to the appropriate advisor.

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