SEC to require TIN from foreign investors

MANILA, Philippines - Corporate regulators have stepped up efforts in making sure foreign company officials are paying proper taxes for their income here in the Philippines.

In a memorandum, the Securities and Exchange Commission (SEC) said it will require the tax identification number (TIN) on foreign investors in a local company.

“No application for incorporation of a corporation, or registration of a partnership shall be accepted unless the TIN or passport number of all its foreign investors are indicated in its registration documents like Articles of Incorporation,” SEC said.

Applications for amendments of a company’s registration documents will not be accepted by SEC unless the TIN of all the foreign investors, natural or juridical, resident or non-resident, are indicated.

“All documents to be filed with the SEC by corporations and partnerships after their incorporation like General Information Sheets shall not be accepted unless the TIN of all its foreign investors are indicated therein,” the SEC added.

The new ruling stemmed from last year’s Revenue Regulation 7-2012 or the “Amended Consolidated Revenue Regulations on Primary Registration, Updates and Cancellation.”

Under the revenue regulation, non-resident aliens not engaged in trade or business or non-resident foreign corporations will be issued TIN for the purpose of withholding taxes on their income from sources within the Philippines.

Prior to or at the time of the filing of their monthly withholding tax return, the withholding agent will apply for the TIN on behalf of the non-resident aliens.

The government, through its tax collection agencies like the Bureau of Internal

Revenue and Bureau of Customs, is intensifying its tax collection efforts to support public spending and lessen the budget deficit.

Losses from tax leaks are estimated at P200 billion annually, government data showed.

SEC said the memorandum is also in line with Executive Order 98 of 1998 that requires all persons dealing with all government agencies to incorporate their TIN in all forms, permits, licenses, clearances, official papers and documents which they secure from these government agencies including government owned and controlled corporations and local government units.

The memorandum, the first for the corporate regulator this year, took effect on January 7.