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Ease of Paying Taxes
(EOPT) Act
Republic Act 11976
“Ease of Paying Taxes (EOPT)
Act”,
Background
Republic Act (RA) No. 11976, otherwise known as the “Ease of
Paying Taxes (EOPT) Act”, was signed into law on January 5,
2024 by President Ferdinand R. Marcos, Jr., together with his
VETO message. It was published in the Official Gazette on January
7, 2024 and took effect on January 22, 2024 or 15 days from its
publication in the Official Gazette.
The law aims to simplify tax filings, particularly for those
classified as Micro and Small Taxpayers, by introducing the file-
and-pay anywhere system and allowing most of the tax
processes to be done online. It also included the shift to an
invoice system to improve the registration process as well as
to accelerate the processing of VAT refunds. The following are the
significant amendments to the Tax Code brought about by the
Classification of Taxpayers
Classification Threshold
 Micro Taxpayers With Gross Sales of less than P 3 Miliion
 Small Taxpayers With Gross Sales of P 3Million but less
than P 20 Million
 Medium Taxpayers With Gross Sales of P 20, Million but less
than P 1 Billion
 Large Taxpayers With Gross Sales of P 1 Billion and
above
Special Concessions for Micro and Small
Taxpayers
Micro and Small Taxpayers shall enjoy the following special
concessions under the EOPT Act:
 Simplified Income Tax Return - two (2) pages
 Reduced rate of 10% for civil penalties under Section 248 of the Tax
Code, as amended
 50% reduction on the interest imposed under Section 249 of the Tax
Code, as amended
 Reduced fine of P 500 as penalty for failure to file certain information
under Section 250 of the Tax Code, as amended
 Reduced compromise penalty rate of 50% for violations of Section
113, 237 and 238 of the Tax Code, as amended
File and Pay Anywhere
The EOPT Act now allows taxpayers to file their tax
returns and pay their taxes, either electronically or
manually, with any Authorized Agent Bank, Revenue
District Office (through its Revenue Collection
Officers), or Authorized Tax Software Provider. This
gives taxpayers the flexibility in filing and paying their
taxes anywhere without worries of incurring
administrative penalties for filing at the wrong
venue.
Ease of Registration
Registration facilities shall be made available to all
taxpayers including those not residing in the
Philippines. The Annual Registration Fee of P 500
was also removed under the EOPT Act. This
provides taxpayers engaged in business, especially
Micro and Small Taxpayers, with immediate financial
relief by reducing their administrative expenses.
Furthermore, the registration of taxpayers shall be
cancelled or transferred upon the mere filing of an
application for cancellation/transfer with the RDO
where the taxpayer is registered.
Simplified Timing of Withholding
Under the EOPT Act, the obligation to deduct and
withhold the tax arises at the time the income has
become payable. This eliminates the need for the
payor to consider when the obligation becomes due,
demandable or legally enforceable. Instead, it
focuses on the more straightforward concept of
when the income has become payable.
Invoicing Requirements
Previously, taxpayers’ claim for deductions and VAT
credit or refund have been disallowed for non-
compliance with invoicing requirements, particularly
with the “business style.” Under the EOPT Act,
“business style” has been removed as a mandatory
information to be contained in the invoice.
The threshold for mandatory issuance of invoices is
increased to P 500, which shall be adjusted to its
present value every 3 years based on the Consumer
Price Index, as published by the Philippine Statistics
Invoicing Requirements
In case of failure of the VAT-registered person to
provide complete information in the invoice, the issuer
shall be liable for non-compliance. However, the VAT
shall still be allowed to be used as input tax credit on
the part of the purchaser if the lacking information do
not pertain to the following:
a. Amount of sales;
b. Amount of VAT;
c. Name and TIN of both the purchaser and
issuer/seller;
Preservation of Books of Accounts
Period for preservation of taxpayer’s books of
accounts and other accounting records shall be
for 5-years reckoned from the day following
the deadline for filing a return, or if filed after
the deadline, from the date of the filing of the
returns, for the taxable year when the last entry
was made in the books of accounts.
Ease of Paying Tax Law Republic Act 11976
Ease of Paying Tax Law Republic Act 11976
Ease of Paying Tax Law Republic Act 11976
Ease of Paying Tax Law Republic Act 11976

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Ease of Paying Tax Law Republic Act 11976

  • 1. Ease of Paying Taxes (EOPT) Act Republic Act 11976 “Ease of Paying Taxes (EOPT) Act”,
  • 2. Background Republic Act (RA) No. 11976, otherwise known as the “Ease of Paying Taxes (EOPT) Act”, was signed into law on January 5, 2024 by President Ferdinand R. Marcos, Jr., together with his VETO message. It was published in the Official Gazette on January 7, 2024 and took effect on January 22, 2024 or 15 days from its publication in the Official Gazette. The law aims to simplify tax filings, particularly for those classified as Micro and Small Taxpayers, by introducing the file- and-pay anywhere system and allowing most of the tax processes to be done online. It also included the shift to an invoice system to improve the registration process as well as to accelerate the processing of VAT refunds. The following are the significant amendments to the Tax Code brought about by the
  • 3. Classification of Taxpayers Classification Threshold  Micro Taxpayers With Gross Sales of less than P 3 Miliion  Small Taxpayers With Gross Sales of P 3Million but less than P 20 Million  Medium Taxpayers With Gross Sales of P 20, Million but less than P 1 Billion  Large Taxpayers With Gross Sales of P 1 Billion and above
  • 4. Special Concessions for Micro and Small Taxpayers Micro and Small Taxpayers shall enjoy the following special concessions under the EOPT Act:  Simplified Income Tax Return - two (2) pages  Reduced rate of 10% for civil penalties under Section 248 of the Tax Code, as amended  50% reduction on the interest imposed under Section 249 of the Tax Code, as amended  Reduced fine of P 500 as penalty for failure to file certain information under Section 250 of the Tax Code, as amended  Reduced compromise penalty rate of 50% for violations of Section 113, 237 and 238 of the Tax Code, as amended
  • 5. File and Pay Anywhere The EOPT Act now allows taxpayers to file their tax returns and pay their taxes, either electronically or manually, with any Authorized Agent Bank, Revenue District Office (through its Revenue Collection Officers), or Authorized Tax Software Provider. This gives taxpayers the flexibility in filing and paying their taxes anywhere without worries of incurring administrative penalties for filing at the wrong venue.
  • 6. Ease of Registration Registration facilities shall be made available to all taxpayers including those not residing in the Philippines. The Annual Registration Fee of P 500 was also removed under the EOPT Act. This provides taxpayers engaged in business, especially Micro and Small Taxpayers, with immediate financial relief by reducing their administrative expenses. Furthermore, the registration of taxpayers shall be cancelled or transferred upon the mere filing of an application for cancellation/transfer with the RDO where the taxpayer is registered.
  • 7. Simplified Timing of Withholding Under the EOPT Act, the obligation to deduct and withhold the tax arises at the time the income has become payable. This eliminates the need for the payor to consider when the obligation becomes due, demandable or legally enforceable. Instead, it focuses on the more straightforward concept of when the income has become payable.
  • 8. Invoicing Requirements Previously, taxpayers’ claim for deductions and VAT credit or refund have been disallowed for non- compliance with invoicing requirements, particularly with the “business style.” Under the EOPT Act, “business style” has been removed as a mandatory information to be contained in the invoice. The threshold for mandatory issuance of invoices is increased to P 500, which shall be adjusted to its present value every 3 years based on the Consumer Price Index, as published by the Philippine Statistics
  • 9. Invoicing Requirements In case of failure of the VAT-registered person to provide complete information in the invoice, the issuer shall be liable for non-compliance. However, the VAT shall still be allowed to be used as input tax credit on the part of the purchaser if the lacking information do not pertain to the following: a. Amount of sales; b. Amount of VAT; c. Name and TIN of both the purchaser and issuer/seller;
  • 10. Preservation of Books of Accounts Period for preservation of taxpayer’s books of accounts and other accounting records shall be for 5-years reckoned from the day following the deadline for filing a return, or if filed after the deadline, from the date of the filing of the returns, for the taxable year when the last entry was made in the books of accounts.