Submission of BIR Form 2316 to the BIR

The Bureau of Internal Revenue (BIR) has required all employers to submit the duplicate copy of BIR Form 2316 (Certificate of Compensation Payment/Tax Withheld) of their employees who are qualified for substituted filing to the BIR.

Under Section 2.83 of Revenue Regulations No. (RR) 2-98, as amended, every employer is required to furnish its employees (including minimum wage earners) BIR Form 2316 on or before January 31 of the succeeding calendar year, or if employment is terminated before the close of such calendar year, on the day on which last payment of compensation is made. Failure to furnish BIR Form 2316 shall be grounds for the mandatory audit of payor’s income tax liabilities (including withholding tax) upon verified complaint of the payee.

In addition to the requirement to furnish BIR Form 2316 to employees, the BIR now requires that all employers submit the duplicate copy of BIR Form 2316 to the BIR not later than February 28 following the close of the calendar year. Failure to submit/file BIR Form 2316 on or before February 28 following the close of the calendar year will merit a penalty of P1,000 for each failure, or a maximum amount of P25,000 for all such failures during a calendar year.

In case the employer fails to comply with the filing or submission of BIR Form 2316 for two consecutive years, the employer shall be liable to a fine in the amount of P10,000 and suffer imprisonment of not less than one year but not more than 10 years upon conviction, in accordance with Section 255 of the Tax Code.

This is in addition to other penalties provided by law. In settlement, a compromise fee of P1,000 for each BIR Form 2316 not filed without any maximum threshold shall be collected by the BIR.

(Revenue Regulations No. 11-2013, June 6, 2013)

Tax Brief – July 2013

Punongbayan and Araullo