The Electronic Filing and Payment System (eFPS) is “a system developed and maintained by the Bureau of Internal Revenue (BIR) for electronically filing tax returns, including attachments, if any, and paying taxes due thereon, specifically through the internet.”[1]

With the eFPS, taxpayers can prepare a paperless tax return and can pay online through an internet-banking service via debit facility from their enrolled bank account.[2] Since eFPS is available online, taxpayers can file and pay for their taxes anytime and anywhere with an internet connection.[3]

This system was first introduced by the BIR through Revenue Regulation (RR) 09-2001 issued on Aug. 3, 2001, in relation to Republic Act No. 8792, or the Electronic Commerce Act, which mandates that government transactions be allowed, and then later required, to be done electronically. This was a breakthrough at the time, when the country was just starting to grasp the potential of the internet. However, this advanced step proved inadequate, when, 14 years later, eFPS still hasn’t taken ground.

The Department of Finance Secretary Cesar V. Purisima said that as of last year, less than 3% of taxpayers file their taxes through eFPS.[4] This is despite efforts of the BIR to make the filing mandatory.[5] In the same report, Purisima said that the government wants to “dramatically” increase the number of taxpayers using the eFPS.[6]

Just last month, the BIR issued RR No. 5-2015 imposing a Php 1,000 fine per return on taxpayers mandatorily covered who fail to file their returns using eFPS or eBIRForms. There is also a 25% surcharge on the taxes due for filing a return not in compliance with the existing regulations and the erring taxpayers will be included in the list of taxpayers prioritized for audit. The regulations took effect “immediately” after its issuance, hence covering the upcoming deadline of filing tax returns on April 15.

Through the years, the BIR has continuously increased the mandatory coverage of taxpayers required to file taxes through eFPS.[7] Starting with RR 2-2002, the previously voluntary filing of taxes through eFPS was made mandatory for Large Taxpayers.[8] Sec. 3 of RR No. 9-2001 was further amended in several issuances (see table) until most taxpayers are covered either by the eFPS or its offshoot eBIRForms.

Revenue Regulation Date Coverage
RR No. 09-2001 Aug. 3, 2001 Voluntary for Large Taxpayers and Non-Large Taxpayers
RR No. 02-2002 Mar. 5, 2002 Mandatory for Large Taxpayers and Optional for 200 BIR identified non-large taxpayers
RR No. 5-2004 Apr. 26, 2004 Mandatory for the BIR identified top 10,000 private corporations
RR No. 10-2007 July 18, 2007 Mandatory for:1. Corporations with paid-up capital stock of Php 10,000,000 and above2. Corporations with complete computerized books of accounts and other accounting records3. All government bidders (pursuant to Executive Order No. 398)
RR No. 3-2009 Feb. 9, 2009 Mandatory for non-large taxpayers belonging to the top 20,000 private corporations identified under RR No. 14-2008
RR No. 1-2010 Jan. 21, 2010 Mandatory for enterprises registered with:1. Philippine Economic Zone Authority2. Board of Investments3. Various zone authorities covered under R.A. 9400 (Special Economic Zones and Freeport Zones)

4. Cagayan Special Economic Zone

5. Export Development Council

6. Tourism Infrastructure and Enterprise Zone Authority

7. PHIVIDEC Industrial Authority

RR No. 1-2013 Jan. 23, 2013 Mandated National Government Agencies to enroll in the eFPS and use the Electronic Tax Remittance Advice
RR No. 6-2014 Sept. 5, 2014 Mandated the use the eBIRForms in filing all tax returns by non-eFPS filers, particularly:1. Accredited Tax Agents/Practitioners and all its client-taxpayers2. Accredited Printers of Principal and Supplementary Receipts/Invoices3. One-Time Transaction (ONETT) taxpayers

4. Those who shall file a “No Payment” Return

5. Government-Owned or -Controlled Corporations

6. Local Government Units, except barangays

7. Cooperatives registered with National Electrification Administration and Local Water Utilities Administration

 

Issued in 2012, Revenue Memorandum Circular (RMC) 61-2012[9] authorized the use of the Electronic BIR Forms (eBIRForms) Package in the preparation and filing of tax returns for the 36 forms included. This is a supplement to the eFPS in order to include “offline” filing, as opposed to the old way of manual filing. The forms can be downloaded from the BIR website, while those without internet access can copy the files from the BIR e-lounges in several Revenue District Offices.[10]

According to the RMC,[11] the taxpayer can “directly encode date, validate, edit, save, delete, view and print the tax returns,” which is different from the “conventional manual process of filling up tax returns on pre-printed forms that are highly susceptible to human error.”

Aside from those required to file their taxes through eFPS or eBIRForms, other taxpayers are also encouraged to use the eFPS.

 

Using the eFPS

In order to file a tax return and pay taxes due through the eFPS, a taxpayer only needs a computer with an internet connection. The use of the system is free and available 24/7. However, paying the taxes due through an Authorized Agent Bank may incur fees charged by the bank or may require a minimum average daily balance.

A taxpayer can access the eFPS at https://efps.bir.gov.ph/index.html.

After that, the taxpayer can “enroll to eFPS” by clicking such link and accomplishing the enrollment form. Upon successful enrollment, the taxpayer will receive an e-message from the BIR approving or disapproving the application on the e-mail address provided in the enrollment. Once the account has been activated, the taxpayer can then e-file and e-pay the taxes. Upon completion of filing, a system-generated filing reference number will be issued which will serve as proof of e-filing.

A large taxpayer need not enroll the business branches separately as a single account will suffice as long as a consolidated return is filed through its head office.

For payments, a taxpayer needs to enroll with an eFPS Authorized Agent Bank (AAB)’s e-payment facility, which may require additional steps. Several commercial banks are already AABs. A taxpayer may use a Fund transfer (for cash payment thru online banking system), a Tax debit memo, or a Tax Remittance Advice (for National Government Agencies) as possible modes of payment. It is advisable to have a separate account for the payment of taxes due, rather than use the same bank account for personal or business purposes.

The tax return is deemed filed on the date the filing reference number is generated. The tax due is deemed paid after a confirmation number is issued to the taxpayer and the BIR by the eFPS-AAB. An acknowledgment number is also issued to the taxpayer by the BIR to confirm that the tax payment has been credited. There is no penalty for not immediately paying the tax due after e-filing, as long as the tax is paid before the deadline.

In light of the current developments in information technology, coupled with the government’s policy of bringing transactions online and electronically, taxpayers need to know the basics of e-filing and e-payment of taxes. Taxpayers should be prepared to transition from manual to electronic, because current trends are geared towards paperless transactions. It may very well be possible that all taxpayers will be required to file electronically in the near future.

Read more about the Corporate Services practice at Disini & Disini Law Office

 


 

[1] Bureau of Internal Revenue (“BIR”), Rev. Reg. No. 9-2001 (2001).

[2] BIR, Rev. Reg. No. 1-2013 (2013).

[3] Id.

[4] Chino Leyco, DOF warns ‘dramatic’ increase in BIR’s e-filing, Manila Bulletin, Feb. 16, 2015, available at http://www.mb.com.ph/dof-wants-dramatic-increase-in-birs-e-filing/.

[5] BIR, Rev. Reg. No. 02-2002 (2002); BIR, Rev. Reg. No. 5-2004 (2004); BIR, Rev. Reg. No. 10-2007 (2007); BIR, Rev. Reg. No. 3-2009 (2009)

[6] Supra note 4.

[7] Supra note 5.

[8] As defined in BIR, Rev. Reg. No. 1-1998 (1998).

[9] BIR, Rev. Mem. Circ. No. 61-2012 (2012).

[10] Ronnel Domingo, BIR Launches Internet Lounges for Taxpayers, The Philippine Daily Inquirer, Feb. 24, 2012, available at http://business.inquirer.net/46121/bir-launches-internet-lounges-for-taxpayers.

[11] Supra note 9.

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