This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our PRIVACY POLICY for more information on the cookies we use and how to delete or block them.
  • Tax Exemptions or Incentives under the “Bayanihan to Heal as One Act”
Newsletter:

Tax exemptions/incentives granted by the government in line with the “Bayanihan to Heal as One Act”

27 April 2020

Tax Exemption/ Incentive

Tax Base

Requirements

Legal BasisBasis

Exemption from additional Documentary Stamp Tax (DST)

• Extension of grace period for the payment of loans provided by all banks, quasi-banks, financing companies, lending companies and other financial institutions, public and private, including GSIS, SSS, and Pag-ibig Fund falling due within the ECQ period.

 

Revenue Regulations (RR) No. 8-2020, April 2, 2020, Revenue Memorandum Circular (RMC) No. 35-2020 dated April 2, 2020

Exemption from additional DST

• Credit extensions and credit restructuring, micro-lending including those obtained from pawnshops during the ECQ period

Extension of maturity periods resulting from the grant of grace period (regardless if the original maturity period falls due or not within the ECQ)

New loan principal resulting from credit extension of pre-existing loans that fall due during ECQ where the interest is paid, provided there is no pre-agreed roll-over agreement prior COVID-19 situation

Covered institutions shall submit in hard and soft copy, a summary listing of all pre-existing loans, pledges and other instruments as of March 17, 2020 which were granted credit extension based on the format prescribed by the BIR.

         
     In case of failure to submit the    
     foregoing, the taxpayer is 
     exposed to the additional DST
     that  should have been imposed
     under the Tax Code, plus
     administrative penalties.

RMC No. 36-2020, April 3, 2020, in relation to RR No. 8-2020

Exemption from VAT, Excise Tax and Other fees, Donor’s Tax and from issuance of Authority to Release Imported Goods (ATRIG)

Importation of critical or needed healthcare equipment or supplies including personal protective equipment, laboratory equipment, testing kits and other equipment/supplies as may be determined by DOH to address the Covid-19 Public Health Emergency

Importation of materials needed to make necessary health equipment or supplies (provided that the importer manufacturer is included in the Master List of the DTI and other governing bodies

To be exempt from Donor’s  Tax, the donation should be to or for the use of National Government or any entity created by any of its agencies which is not conducted for profit, or to any political subdivision of the Government.

RR. No. 6-2020, March 27, 2020

Full deductibility for Income Tax

Specific donations for the sole and exclusive purpose of combatting COVID 19 during the period of the state of national emergency:
  ♦ Cash Donations
  ♦ Donations of all critical or needed healthcare equipment or supplies,
  ♦ Relief goods such as, but not limited to, food packs (rice, canned goods, noodles, etc.) and water; and
  ♦ Use of real or personal property

Donees and the supporting document should be:

1. National Government, or any entity created by its agency (including public hospitals) not conducted for profit, or to any of its political subdivision regardless if covered by NEDA Annual priority plan.
Required Supporting Document: Deed of donation.
2. Accredited non-stock , non-profit educational, charitable, religious, cultural, social welfare corporation, institution, foundation, non-government  organization, trust or philanthropic organization and/or research institution.
Required Supporting Document: Certificate of Donation (BIR Form 2322).

Section 3 of RR No. 9-2020, April 6, 2020

Full deductibility for Income Tax;

 

Exemptions from Donor’s Tax

Donees and the supporting documents (to be submitted within 60 days from the lifting of ECQ) should be:
1.) Private hospitals, non stock non profit educational and/or charitable,  religious, cultural, social welfare corporation, institution, foundation, non-government organization (even if non accredited), non-government organization, trust or philanthropic organization and/or research institution.

Required Supporting Documents:
Donee’s Liquidation report in the prescribed format of the BIR;
Donor’s Sworn Certification with in the prescribed format of the BIR;
Donor’s BIR-Registered Acknowledgement Receip

2.) Local private corporation, civic organization, and/or international organization/institution. Provided, (a) they actually, directly and exclusively distribute and/or transfer said donations, and/or (b) partner as conduit/logistic with, accredited NGOs not conducted for profit, National Government, or any entity created by its agency, or to any of its political subdivision.

Required Supporting Documents:
Donee’s Liquidation report with format prescribed by the BIR
Certificate of Donation (BIR Form No. 2322) or Deed of Donation
Donor’s proof of purchase (if in kind)
Donor’s BIR-Registered Acknowledgement Receipt

Sections 4, 5  and 6 of RR No. 9-2020, April 6, 2020

Exemption from VAT on deemed sale on donations in kind; attributable input VAT is creditable against output VAT

• Donations of all critical or needed healthcare equipment or supplies,
Relief goods such as, but not limited to, food packs (rice, canned goods, noodles, etc.) and water;
 

Section 7 of RR No. 9-2020, April 6, 2020