Incorrect Tax Exemption Declaration, Incomplete BIR Registration, and Unregistered Commercial Activities
National Housing Authority · 2023
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What Happened?
Category: Tax ComplianceIssue: Non-complianceThe agency incorrectly claims full tax exemption and fails to register its commercial rental business with the tax authorities, which could lead to severe tax penalties and fines.
Why It Matters
Recommended Actions
- Review and update the COR of NHA, declaring all the sources of income to ascertain correct tax obligations;
Original Audit Finding Excerpt
"The income tax return used by NHA for annual filing declared all its revenue as exempt from tax despite having sources of income from commercial activities and the non-recognition of creditable withholding taxes, contrary to the relevant provisions of RA No. 8424, as amended by RA No. 10963, RA No. 11534, RA No. 7279, and Revenue Regulations No. 11-97, may enables the Bureau of Internal Revenue (BIR) to assess NHA for potential tax obligations, penalties, and surcharges."