MANILA, Philippines – The Bureau of Internal Revenue (BIR) has temporarily suspended field audits nationwide under Revenue Memorandum Circular (RMC) No. 107-2025, a move that has raised questions among taxpayers and businesses currently under investigation.

Issued on November 24, the circular pauses most audit and investigation activities to address long-standing systemic issues, strengthen taxpayer protection, and pave the way for a more transparent, standardized, and modern audit process. To clarify the scope of the suspension, the BIR later released RMC No. 109-2025 on December 12, which details the activities covered by the suspension and those that are exempt.

Below is a practical Q&A guide to help taxpayers understand what the suspension means, who is affected, and what continues despite the pause.

What is RMC No. 107-2025 about?

RMC No. 107-2025 temporarily halts BIR field audits and investigations to address systemic weaknesses in tax enforcement, protect taxpayer rights, and establish a more consistent and transparent audit framework. The suspension was issued under the leadership of newly appointed Commissioner Charlito Martin R. Mendoza.

When does the suspension take effect, and how long will it last?

The suspension of BIR field audit activities took effect on November 24, 2025. Audit operations will remain on hold until the Commissioner of Internal Revenue (CIR) issues a formal order lifting the suspension. During this period, only activities expressly exempted under the RMCs are allowed to continue.

Who and what are covered by the suspension?

The suspension applies to all taxpayers currently undergoing audit or investigation, including individuals, corporations, estates, and business owners, provided the examination is being conducted under a Letter of Authority (LOA) or Mission Order (MO).

Does this apply nationwide?

Yes. The suspension covers all BIR offices nationwide, including:

• Large Taxpayers Service (LTS)
• Revenue Regions (RRs)
• Revenue District Offices (RDOs)
• National and Regional Investigation Divisions
• Assessment Divisions
• VAT Audit Unit (LTS)
• VAT Audit Sections
• National and regional investigation divisions
• All other offices, committees, and task forces authorized to conduct examinations, verification of taxpayers’ books of account, records, and other related transactions or investigations.

Which cases are NOT covered by the suspension?

For audits covering multiple tax types, if at least one tax type is nearing its prescriptive deadline, the BIR will proceed with the entire audit to prevent incomplete investigations and protect the government’s right to collect taxes.

Which audit and investigation activities are suspended?

The suspension covers most field audit operations, including:

• All ongoing and upcoming field audits and related field operations
• Issuance of new LOAs, MOs, and Tax Verification Notices (TVNs)
• Other notices directly related to examining taxpayer records
• Issuance of other notices related to the examination and verification of taxpayers’ books of accounts, records, and other related transactions.

Which activities continue despite the suspension?

Certain actions are allowed to proceed, including:

• Verification of withholding taxes on property sales
• Issuance and service of assessment notices for exempt cases, such as:
  • Preliminary Assessment Notices (PAN)
  • Final Assessment Notices (FAN)
  • Final Decisions on Disputed Assessments (FDDA)
    
• Collection activities for final and executory assessments, including:
  • Warrants of Distraint or Levy
  • Garnishments and seizure notices
    
• Collection-related letters and third-party verifications (e.g., with the Land Registration Authority (LRA) or Register of Deeds)
• Reminder letters for stop-filer cases and follow-ups for required schedules (e.g., SLS/SLP/SLI, alphalists, inventory lists, etc.)

How does the suspension affect notices, payments, and settlements?

Notices issued before the suspension, such as Notice of Discrepancies (NODs), PANs, FANs, or FDDAs, remain valid. Taxpayers must continue to observe statutory deadlines for payment or filing protests. Payments for settlements finalized before the suspension may also continue.  Moreover, taxpayers may voluntarily settle deficiency taxes during the suspension using BIR Form No. 0605 through eFPS, eBIRForms, or authorized agent banks, even without prior BIR approval.

Are there compliance requirements during the suspension?

All concerned BIR offices must submit an inventory of pending or unserved LOAs and MOs to the CIR within 15 working days from the RMC’s effective date.

For taxpayers, the suspension does not mean a break from compliance. The filing of returns and payment of taxes remain mandatory. Regular BIR transactions — such as registration, issuance of certifications, and tax payments — continue without interruption.

RMC No. 107-2025, as clarified by RMC 109-2025, provides temporary relief from field audits but does not suspend tax obligations or enforcement altogether. By understanding what is paused, what continues, and which cases are exempt, taxpayers can better protect their rights while staying compliant during this transition toward a more transparent and standardized tax audit system. – Rappler.com

ACG is the most trusted tax advisory firm in the Philippines, providing tax strategy, compliance, and policy advisory services to multinational corporations, foreign investors, and government institutions. With a strong presence in Asia and an expanding global network, ACG continues to bridge the gap between international investors and the dynamic Philippine market. To explore partnership opportunities or join ACG’s global investment promotion initiatives, CONSULT ACG, or you may also send an email to consult@acg.ph.