RMC No.

54 - 2014
Clarifies the issues relative to the application for Value Added Tax (VAT) refund/tax credit
attributable to zero-rated sales. The salient features of the RMC are as follows:

1. Prescriptive Period
Any VAT-registered person whose sales are zero-rated or effectively zero-rated may within two
(2) years after the close of the taxable quarter when sales were made, apply for the issuance of
tax credit certificate or refund of creditable input tax attributable to such sales. The taxpayer can
file his administrative claim at anytime within the two-year prescriptive period.

The Commissioner of Internal Revenue (CIR) has 120 days from the date of submission of
complete documents to decide whether or not to grant the claim. If it is not acted upon within the
120-day period, such inaction shall be deemed a denial of the application for tax refund or
credit.

2. Filing and Processing of Administrative Claims

The application for VAT refund/tax credit must be accompanied by complete supporting
documents. A statement under oath attesting to the completeness of the submitted documents
should be attached therein. The affidavit shall further state that the said documents are the only
documents which the taxpayer will present to support the claim. For juridical persons, there
should be a sworn statement that the officer (at least the Chief Financial Officer) signing the
affidavit has been authorized by the Board of Directors of the company. The BIR provides for a
checklist of mandatory requirements and the sample template of the sworn certification.

Upon submission of the claim and its supporting documents, no other documents shall be
accepted or required. Decisions shall be rendered based only on the documents submitted by the
taxpayer. Where the taxpayer fails to submit the complete supporting documents, the application
shall be denied by the processing/investigating office, by issuing a Denial Letter to the taxpayer.

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RMC No. 54- 3. Mandatory 120+30 Day Period

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In case of denial of the claim for refund or tax credit, or the inaction of the CIR
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within the prescribed period, the taxpayer is required to observe the 120+30 day
require Adobe rule before lodging a petitioner for review with the Court of Tax Appeals (CTA).
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The taxpayer can appeal by filing a judicial claim within 30 days after the CIR
denies the claim within the 120-day period, or by filing a judicial claim within
30 days after the expiration of the 120-day period if the CIR does not act within
the 120-day period.

4. Exception to the mandatory and jurisdictional nature of the 120+30 day

period

As an exception to the 120+30 day rule, taxpayers/claimants need not wait for
the lapse of the 120-day period before it could seek judicial relief with the CTA
by way of Petition for Review from 10 December 2003 (time of issuance of BIR
Ruling No. DA-489-03) up to 06 October 2010 (its reversal by the Supreme
Court in Aichi case). This applies only to cases of premature filing (filing prior
to the lapse of the 120-day period) and does not extend to late filing of a judicial
claim.

5. Pending Administrative Claim

Where a petition for review is filed with the CTA, the CIR loses jurisdiction
over the administrative claim, but its Processing Office shall still review the
claim internally in order to intelligently oppose the taxpayers judicial claim.

Failure to file a judicial claim with the CTA within 30 days from the expiration
of the 120-day period renders the CIRs decision, or inaction deemed a denial,
final and unappealable. This applies to all currently pending administrative
claims for refund/tax credit.

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