Practice question
An agent deducts tax from a supplier payment, then uses the amount to buy inventory and files no withholding return. It argues that the payee received less cash, so its entire duty is complete. Which is correct?
- Deduction alone completes every duty
- The agent remains obliged to keep the trust funds separately and comply with return and remittance duties
- Inventory purchases automatically remit tax
- A supplier cannot ever be subject to withholding
- Only the payee can file any relevant return
Legal references
- https://lawphil.net/statutes/repacts/ra2024/ra_11976_2024.html — RA 11976, section 9 amending NIRC section 58 and repeal of section 34(K)
- https://www.dof.gov.ph/newly-signed-ease-of-paying-taxes-act-to-modernize-ph-tax-administration-and-strengthen-taxpayer-rights/ — official DOF confirmation of the section 8 veto
- https://bir-cdn.bir.gov.ph/local/pdf/RMC%20No.%203-2024.pdf — BIR RMC 3-2024 circularizing RA 11976 and presidential veto
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