Please note that certain of the information in this article has since been updated, amended and/or clarified through subsequent issuances by relevant government agencies. Please click here to access the relevant update.
The Bureau of Internal Revenue (BIR) and Securities and Exchange Commission (SEC) have issued new Memorandum Circulars and a Notice in response to COVID-19, as follows:
1. Revenue Memorandum Circular No. 29-2020 – This amends RMC No. 26-2020 by extending the deadlines for the filing and payment of tax returns falling due within the community quarantine period.
3. SEC Memorandum Circular No. 9, Series of 2020 – This provides guidelines for filing the General Information Sheet (GIS) after the election of directors, trustees and officers or after stockholder/member meetings due to be held during the community quarantine period.
We have outlined below the key points of information arising under these new BIR and SEC issuances.
Contents
1. BIR – Revenue Memorandum Circular No. 29-2020
The BIR has issued Memorandum Circular No. 29-2020, dated 19 March 2020.
The purpose of the Memorandum is to amend RMC No. 26-2020. RMC No. 26-2020 previously confirmed that the deadlines for certain tax filings and payments falling due within the community quarantine period would not be extended. This has now been amended and tax filing and payment deadlines falling in March and early April have now been extended.
Key points of information:
- The BIR has extended the deadlines for tax filings and payments falling due within the community quarantine period. This period includes tax filings and payments falling due between 20 March 2020 and 14 April 2020 (inclusive).
- The list of tax filings and payment deadlines that have now been extended by the BIR can be found here.
- In general, almost all of the tax filing/payment deadlines referenced within this Memorandum have been extended by approximately 30 days.
- Finally, if the date for payment of ONETT (One-Time Transactions) transactions (BIR Form Nos. 1706, 1707, 1800, 1801 and 1606) falls within the community quarantine period, the period to file the return and pay the corresponding tax is extended for 30 calendar days from the original due date.
2. SEC – Notice
The SEC has issued a new Notice, dated 18 March.
The purpose of this new Notice is to relax the requirements for public and non-publicly listed companies when filing for an extension on the filing periods for the 2019 Annual Report and 2019 Audited Financial Statement (AFS).
Key points of information:
- On 12 March 2020, the SEC issued Memorandum Circular No. 5, Series of 2020. This Memorandum extended the filing period, without penalty, for companies to submit their 2019 Annual Reports and/or the 2019 Annual Financial Statement (AFS). For companies with a financial year ending on 31 December 2019, the filing period was extended until 30 June 2020 (with a slight variation for companies with both domestic and foreign operations). Our recent article outlined the key information contained in Memorandum Circular No. 5, Series of 2020
- However, in order to apply for this extension, both publicly listed companies and non-publicly listed companies had to adhere to certain administrative requirements.
- Under this latest Notice from the SEC, the SEC has now dispensed with the following requirements, for both public and non-publicly listed companies, when applying for the extension:
- A sworn certification signed by the company’s President and Treasurer confirming that the following conditions have been satisfied;
- The company’s financial year-end is 31 December 2019;
- The company has significant business operations or significant subsidiaries in areas/countries/territories affected by COVID-19;
- The preparation of financial statements and timely completion of the statutory audit of the company’s financial statements as of 31 December 2019 have been affected by the travel restriction/ban, temporary suspension of business operations, and/or measures imposed by the authorities or companies in response to COVID-19.
- A sworn certification by the company’s external auditor confirming No.2 and No.3 above.
- Finally, for companies with a fiscal year that ended in November 2019, the filing date for the Annual Report and AFS has now also been extended until 30 June 2020.
3. SEC Memorandum Circular No. 9, Series of 2020
The SEC has issued SEC Memorandum Circular No. 9, Series of 2020, dated 18 March 2020.
The purpose of this Memorandum is to provide guidelines for filing the General Information Sheet (GIS) after the election of directors, trustees and officers or after company meetings, during the community quarantine period.
Key points of information:
- Under Philippine law, corporations are required to report the details of any newly elected directors, trustees and/or officers within 30 days from the date of election. Corporations are also required to file their GIS within 30 calendar days from the date of the annual stockholders meeting (for stock corporations) or members meeting (non-stock corporation).
To ease the burden of the business sector during the community quarantine period, the SEC has resolved to adopt the following measures:
- Where directors, trustees or officers have been elected – The GIS must be submitted within 30 days of the election meeting through mail (ordinary or registered), private courier or email at mlmliwanag@sec.gov.ph, mdtmabuyo@sec.gov.ph or cmdnotice@sec.gov.ph.
- Where scheduled annual meetings or elections are not held due to COVID-19 – Where elections/meetings were due to be held between 1 March 2020 and 31 May 2020 but were not held and are unable to be held remotely due to COVID-19, a report must be sent to the SEC within 30 days of that scheduled meeting together with a statement confirming a proposed new date which must be held within 60 days of the original date.
- Non-holding of annual meeting or elections due to reasons other than COVID-19 – For such meetings that were scheduled outside of the covered period or are not held for reasons other than COVID-19, a report must be sent to the SEC within 30 days of that scheduled meeting together with a statement confirming a proposed new date which must be held within 60 days of the original date.
- Submission of Report – The report referenced in the two sections above, should be submitted to the SEC via email at cmdnotice@sec.gov.ph and must contain the following details:
- Corporate name
- SEC registration number
- Date of annual meeting (per Bye-Laws)
- Date of actual meeting
- Reason for non-holding of meeting
- Venue of intended meeting
- Signed and dated by Corporate Secretary
- Elections or meetings held subsequently to the SEC report – Where a meeting or election is held subsequent to sending the SEC report (referenced above) and which is held outside the covered period, the results of such elections or meetings must be reported to the SEC within 30 days from the date on which the actual meeting/election took place.
CloudCfo – Outsourced accounting, bookkeeping and finance services in the Philippines
CloudCfo is the outsourced provider of accounting, bookkeeping, compliance and finance services for businesses in the Philippines.
Based in Mandaluyong, Manila, CloudCfo serves companies across a range of industries including technology and fintech, restaurants and cafes, bars, hotels, services, finance, lending and retail.
Visit www.cloudcfo.ph for more information about our services or contact us directly at enquire@cloudcfo.ph.
