Guidelines & Policies for the Monitoring of Service fees

of Professionals(Revenue Regulations 4-2014)

Basic Taxpayer Obligations

"The ultimate inspiration is the deadline"

Revenue Memorandum Circular No. 32-2014-Extension of time to comply with RR 4-2014 from May 6 to May 31, 2014

REGISTRATION

New Requirements on REGISTRATION (RR 4-2014)

• All self-employed professionals shall submit an AFFIDAVIT indicating the ff:

1.) rates;2.) manner of billings;3.) and the factors they may consider in

determining their fees.

Examples of affidavit

Source: PICPA website

When to submit?

• Due date– Upon registration and every year

thereafter on or before Jan. 31• Transitory provision

– Affidavit to be submitted within 30 days from effectivity of this Regulation

– May 31, 2014 per RMC 32-2014

INVOICING

New Requirements on INVOICING (RR 4-2014)

– In cases when no professional fees are charged by the professional and paid by client, a BIR registered receipt, duly acknowledged by the latter, shall be issued showing a discount of 100% as substantiation of the “pro-bono” service.

BOOKKEEPING

***PATIENTS’ LOG BOOK (A SUBSIDIARY BOOK)

• Daily list of clients w/ the corresponding fees including those free of charge, per branch– Name and address– Date– Official receipt no.– Amount charge

• Must be registered with the BIR

New Requirements on BOOKKEEPING (RR 4-2014)

OFFICIAL APPOINTMENT BOOKS (RR 4-2014)

• Shall contain only the names of the client and the date/time of the meeting

• Due date– May 31, 2014

RECAP

1. Submit affidavit on or before May 31, 2014 and every year thereafter;

2. Register appointment book on May 31, 2014;

3. Issue receipt for "pro bono" transactions

Penalty Clause• SEC. 254. Attempt to Evade or Defeat Tax. - in addition to other

penalties provided by law, upon conviction thereof, be punished by a fine not less than Thirty thousand (P30,000) but not more than One hunderd thousand pesos (P100,000) and suffer imprisonment of not less than two (2) years but not more than four (4) years: That the conviction or acquittal obtained under this Section shall not be a bar to the filing of a civil suit for the collection of taxes.

• SEC. 275. Violation of Other Provisions of this Code or Rules and Regulations in General. - Any person who violates any provision of this Code or any rule or regulation promulgated by the Department of Finance, for which no specific penalty is provided by law, shall, upon conviction for each act or omission, be punished by a fine of not more than One thousand pesos (P1,000) or suffer imprisonment of not more than six (6) months, or both.