April 16, 2018

REVENUE MEMORANDUM ORDER NO. 033-18

SUBJECT : Consolidation, Clarification and Reiteration of the Existing Policies

and Procedures in the Issuance of Authority to Cancel Assessment
(ATCA)

TO : All Internal Revenue Officers and Others Concerned

I. BACKGROUND
The nature of the Bureau's Accounts Receivables/Delinquent Accounts (AR/DAs)
arose from different sources; and the same, at any given period of time, are being
handled by different functional groups, namely: the Collection Group, the Assessment
Group and the Legal Group. These AR/DAs have been continuously increasing from
years 2012 to 2017, and the increase is the results of the various programs and reform
projects being implemented by the Bureau such as among others, reinvigorated tax
assessments arising from third party information, continuous implementation of Run
After Tax Evaders (RATE) Program, as well as improved system for recording and
monitoring of AR/DAs nationwide that paved the way for capturing tax arrears data that
were not recognized as AR/DAs in previous tax administrations considering that the
recording and monitoring thereof were being made on a purely manual basis. Since
various initiatives are continuously being implemented, it is expected that these may
result to further growth of AR/DAs in the ensuing years.
The Bureau is currently at the stage of accounting, cleaning and determining the
collectability of the inventory of AR/DAs, and several initiatives and strategies have
been introduced in the management of AR/DAs at the same time. At this stage, it is
imperative that an objective write-off mechanism based on established sound criteria
be put in place in order to purge the database of tax arrears that are no longer
collectible.
II. OBJECTIVES — This Order is issued to:
1. Consolidate and reiterate the existing policies, procedures and guidelines
in the issuance of ATCA;
2. Clarify the time and manner, or when and how to issue ATCA for the
uniform guidelines of all concerned revenue officers and officials;
3. Identify responsible revenue o ces in the preparation of ATCA as well as
Revenue Officials authorized to sign or approve it; and
4. Prescribe the necessary reporting requirements on the issuance of ATCA
for monitoring purposes.
III. POLICIES AND GUIDELINES — In the issuance of ATCA, the following
policies and guidelines shall be strictly observed:
1. The Authority to Cancel Assessment (ATCA) shall be issued as proof of
cancellation of assessments with issued Final Assessment Notice
(FAN)/Formal Letter of Demand (FLD) which were recorded in Form 40.00
(Protested)/AR/DA case/s of concerned delinquent taxpayers due to any
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 of the following instances:
a. The difference between the amounts of the original tax assessment
and the reduced tax assessment after the originally issued Final
Assessment Notice (FAN)/Formal Letter of Demand has been
modi ed, amended, or declared "null and void" covered by a nal
administrative decision by the Commissioner or his duly authorized
revenue o cial as shown in the Final Decision on Disputed
Assessment (FDDA) duly numbered for monitoring and tracking
purposes, after the conduct of review/evaluation/reconsideration of
the factual and/or legal bases raised in its protest/appeal/motion
for reconsideration, therefor, as de ned under Revenue Regulations
(RR) No. 12-99 as amended by RR Nos. 18-2013 and 7-2018;
b. Final approval of the corresponding application for compromise
settlement and abatement or cancellation of penalties pursuant to
Section 204 (a) of the Tax Code and its implementing regulations;
c. Decision by the competent court/s where the assessment was
either modi ed, amended or declared "null and void" with nality
as shown in the entry of judgment;
d. Declaration that the AR/DA case is uncollectible due to insolvency by
a competent court in a final and executory judgment;
e. Taxpayer's availment of tax amnesty which are included in the List of
the Tax Amnesty Availers provided by the O ce of the
Commissioner or Deputy Commissioner, Operations Group;
f. Condonation of the assessment by virtue of law, provided the
required documentations thereon have been submitted, evaluated
and thereafter approved by the Commissioner or his authorized
Revenue Official;
g. When the right of the government to assess/collect the
corresponding de ciency/delinquent taxes has prescribed in
accordance with Sections 203 and 222 of the Tax Code, as
amended, and the cancellation due to the aforesaid reason has been
approved by the Commissioner based on the recommendation of
the National Committee on Prescribed Cases that was created for
this purpose;
h. AR/DA case/s that are recommended for write-off and approved by
the Commissioner of Internal Revenue or his duly authorized
representative on the grounds such as but not limited to the
following:
i. Individual taxpayer is deceased and no distrainable or
leviable assets could be found;
ii. Permanent cessation of business;
iii. Dissolution;
iv. Taxpayer is a general partnership and the individual
partners are already deceased;
v. AR/DA case/s with a total amount due of Php20,000.00
and below, provided that all collection enforcement
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 summary remedies have been fully exhausted.
i. Such other meritorious cases which the Commissioner may deemed
necessary to be covered by ATCA.
2. The ATCA shall be prepared, recommended and approved by the
concerned o ce/o cial strictly in accordance with the Matrix on the
Preparation of ATCA ("Annex A") of this Order. The reason for the
full/partial cancellation of the tax assessment stated in item III.1 of this
Order shall be clearly indicated in the space provided in the ATCA Form.
Likewise, the supporting documents identi ed in the said matrix shall be
attached to the tax docket as basis for the preparation and approval of
ATCA.
3. Based on the prescribed matrix, the ATCA shall be prepared and signed by
the recommending revenue o cial within fteen (15) working days from
the receipt of the tax docket. Each tax case recommended for partial/full
cancellation shall be approved/acted upon by the concerned approving
revenue o cial within seven (7) working days from receipt of the docket
of the case.
4. ATCA shall be prepared in quadruplicates to be distributed as follows:
Original - Docket of the case
Duplicate - Issuing Office
Triplicate - Accounts Receivable Monitoring Division (ARMD)
Quadruplicate - Collection Division (CD)/Large Taxpayers
Collection Enforcement Division (LTCED)
5. Each tax assessment with issued FAN/FLD or AR/DA case referred to the
Regional Legal Division/Appellate Division/Law and Legislative
Division/Litigation Division for the resolution of issues involving questions
of law, due process and/or alleged prescription of the Bureau's right to
assess/collect the tax liabilities shall be resolved within thirty (30)
days from receipt of the protested docket/AR/DA case/s. After resolution,
these tax dockets shall be returned immediately to the originating o ce
for appropriate action.
6. AR/DA cases recommended for write-off due to prescription shall be
forwarded to the Regional Committee on Prescribed Cases for its initial
evaluation/recommendation. The National Committee on Prescribed
Cases shall subsequently review the initial evaluation/recommendation,
and le the appropriate administrative sanctions against the concerned
revenue o cers/o cials who is/are responsible for the prescription of
AR/DA case/s. The Accounts Receivable Monitoring Division (ARMD),
acting as the Secretariat of the National Committee on Prescribed Cases,
shall only prepare the ATCA, after the approval by the Commissioner of
Internal Revenue of the recommendation for write-off and the ling of the
administrative sanctions.
7. AR/DA case/s recommended and approved for cancellation/write-off
under item III.1.h of this Order shall be accompanied by an Evaluation
Report on Uncollected AR/DA Recommended for Write-off (Annex "B")
together with all the necessary supporting documents as prescribed in
Annex A of this Order pursuant to Revenue Memorandum Order (RMO) No.
11-2014. These documentary requirements shall be attached to the tax
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 docket for purposes of reviewing and evaluating the propriety of the
recommendation, and the subsequent approval of the cancellation/write-
off by the Commissioner of Internal Revenue or his duly authorized
Revenue Official.
8. Assessment with issued FAN/FLD or AR/DA case/s previously reported in
the General Control Ledger (GCL) report shall be closed upon the approval
of ATCA by filling-out the ATCA column of the GCL report (BIR Form 0319).
The GCL report and its corresponding attachment "Monthly List of
Accounts Cancelled" (BIR Form 0319-A4) shall be submitted to ARMD in
hard and soft copies, together with the triplicate copy of ATCA, not later
than 10th day of the month following the date of the approval of ATCA.
9. Assessment with issued FAN/FLD or AR/DA case/s previously included in
AR/DA database shall be removed by updating the "AR/DA Inventory List"
(Annex F of RMO No. 22-2015). The said list shall be submitted in hard and
soft copies to ARMD together with the GCL Report not later than 10th day
of the month following the date of the approval of ATCA.
10. The ARMD shall monitor the reports on AR/DA case/s approved for
cancellation and validate the authenticity of ATCA issued by concerned
O ces identi ed in the matrix prescribed under this Order and submit the
results thereof to Collection Service within twenty- ve (25) working days
from the set deadline of submission of GCL reports and AR/DA Inventory
List.
11. O ces authorized to prepare ATCA shall request for ATCA forms from
their respective Administrative Division in the Regional O ces, or from the
Accountable Forms Division for those in the National Office.
12. The Administrative Division/Accountable Forms Division is responsible
for the issuance of ATCA forms, as well as in the monitoring of its
inventory to ensure su ciency of supply. It shall regularly prepare a report
thereon ("Annex C" ) which shall be submitted to ARMD on or before the
10th day of the month following the close of every quarter.
IV. TRANSITORY PROVISIONS
1. All unused ATCA Forms previously issued to O ces who are no longer
authorized to prepare ATCA under this Order shall be immediately surrendered to the
Administrative Division of the Regional O ce or to the Accountable Forms Division for
offices in the National Office, as the case may be, upon effectivity of this Order.
2. All concerned o ces who failed to surrender unused ATCA Forms shall be
reported to the O ce of the Assistant Commissioner, Collection Service for
appropriate action.
3. All unused ATCA forms shall be issued to O ces authorized to prepare
ATCA as specified in "Annex A" of this Order .
V. REPEALING CLAUSE. All existing rules and regulations or rulings or parts
thereof, which are contrary to or inconsistent with the provisions of this Order are
hereby amended, modified or repealed accordingly.
VI. EFFECTIVITY. The provisions of this Order shall take effect immediately.

(SGD.) CAESAR R. DULAY

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 Commissioner of Internal Revenue

ANNEX A
Matrix on Preparation of Authority to Cancel Assessment (ATCA)

Recommending
Reason for Cancellation ATCA Preparer Approval Supporting Documents
Approval
A. Assessment Division Head of Office, Regional
Assessments with issued * Revised ass
(AD)/National AD/NID/equivalent Director/Assistant
FAN/FLD included in the Form shown in the Fin
Investigation Division office in the LTS Commissioner,
40.00 Protested report where the Disputed Assessm
(NID)/equivalent Enforcement
nal assessment as originally as duly appro
office in the Large Advocacy Service
issued were either modi ed, concerned Regi
Taxpayers Service (EAS)/Assistant
amended, or declared "null and (RD)/Assistant
(LTS) Commissioner-
void" duly covered by a nal Large Taxpayers
LTS
administrative decision by the LTS)/Commissione
Commissioner of Internal Revenue Revenue (CIR)
or his duly authorized Revenue
* Decision or ru
O cial after the conduct of
nal assessment
review/evaluation/reconsideration
issued were ei
of the factual and/or legal bases
amended, or dec
raised in the
protest/appeal/motion for void" as shown
reconsideration of the taxpayer Decision on
Assessment/s (FD
by the Commissio
Revenue or his d
Revenue O cial af
of
review/evaluation/
of the factual and
raised i
protest/appeal/mo
reconsideration of

Receivable Accounts Head of Office, Regional

Assessments with issued and Collection Regional Collection Director/Assistant * Revised ass
FAN/FLD included in the Form Enforcement Section Division Commissioner, shown in the Fin
40.00 Unprotested report (AR/DA (RACES)/Collection (RCD)/ARMD/LTCED Collection Service Disputed Assessm
cases) where the final assessment Enforcement (CS)/Assistant as duly appro
as originally issued were either Monitoring Section Commissioner- concerned Regi
modi ed, amended, or declared (CEMS) of Accounts LTS (RD)/Assistant
"null and void" duly covered by a Receivable Large Taxpayers
nal administrative decision by LTS)/Commissione
Monitoring Division
the Commissioner of Internal Revenue (CIR)
(ARMD)/Large
Revenue or his duly authorized
Taxpayers Collection * Decision or ru
Revenue O cial after the conduct
Enforcement Division nal assessment
of
(LTCED) issued were ei
review/evaluation/reconsideration
of the factual and/or legal bases amended, or dec
void" as shown
raised by the taxpayer
Decision on
Assessment/s (FD
by the Commissio
Revenue or his d
Revenue O cial af
of
review/evaluation/
of the factual and
raised by the taxpa
*** ARMD — shall
prepare the ATCA of
AR/DA cases
handled by NID, and
Legal Service except
AR/DA cases under
Large Taxpayers
Service
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 B. RACES/LTCED Head of Office, Regional
Assessments with issued RCD/LTCED Director/ACIR, LTS Evaluation and recom
FAN/FLD or AR/DA case/s which approved by the Regi
were the subject of approved Board (REB)/Large Ta
applications for compromise Evaluation Board (LTS
settlement under the jurisdiction
of Regional Evaluation Board Certi cate of Availme
(REB)/Large Taxpayers Evaluation by the concern
Board (LTEB) Director/ACIR, LTS

Compromise and Head of Office, ACIR, CS

Assessments with issued Abatement Review, ARMD Evaluation and recom
FAN/FLD or AR/DA case/s which Evaluation and approved by the Nati
were the subject of approved Monitoring Section Board (NEB)
applications for compromise (CAREMS) of ARMD
settlement and abatement of Certi cate of Availme
penalties under the jurisdiction of by the ACIR, Collection
National Evaluation Board (NEB)

C. RACES/CEMS of Head of Office, Regional

Decision by the competent court/s Certi ed true copy
ARMD/LTCED RCD/ARMD/LTCED Director/ACIR,
where the assessment was either *** ARMD — shall CS/ACIR, LTS decision with entry of j
modi ed, amended or declared
prepare the ATCA of
"null and void" with nality as AR/DA case/s
shown in the entry of judgment;
handled by Litigation
Division except
AR/DA case/s under
the jurisdiction of
Large Taxpayers
Service
D. RACES/CEMS of Head of Office, Regional
Declaration that the AR/DA case ARMD/LTCED RCD/ARMD/LTCED Director/ACIR, Certi ed true copy
is uncollectible due to insolvency *** ARMD — shall CS/ACIR, LTS decision with entry of j
by a competent court/s in a nal prepare the ATCA of
and executory judgment; AR/DA case/s
handled by Litigation
Division except
AR/DA case/s under
the jurisdiction of
Large Taxpayers
Service
E. RACES/CEMS of Head of Office, Regional
Assessments with issued ARMD/LTCED RCD/ARMD/LTCED Director/ACIR, Copy of CIR Memora
FAN/FLD or AR/DA case/s *** ARMD — shall CS/ACIR, LTS with the copy of
covered by taxpayer's availment prepare the ATCA of delinquent taxpayer i
of tax amnesty which are included AR/DA case/s List of Tax Amnesty Av
in the List of the Tax Amnesty handled by Litigation by the Account
Availers provided by the O ce of Division except Monitoring Division
the Commissioner or Deputy con rmed by the O c
AR/DA case/s under
Commissioner, Operations Group the jurisdiction of Commissioner — Oper
Large Taxpayers
Service
F. RACES/ARMD/LTCED Head of Office, Regional
Assessments with issued RCD/ARMD/LTCED Director/ACIR, Recommendation wit
FAN/FLD or AR/DA case/s CS/ACIR, LTS the authorized Re
allowed to be condoned by virtue indicated in the rev
of law approved by the prescribing the po
Commissioner or his authorized processing
Revenue Official

G. CAREMS OF ARMD National Committee ACIR, CS

AR/DA case/s in which the right of on Prescribed Cases Evaluation and recom
the government to assess/collect approved by the
the corresponding con rmed by the
de ciency/delinquent taxes has Prescribed Cases in
prescribed Office

H.
AR/DA case/s recommended for
write-off on the following grounds:

RACES/CEMS OF Head of Office, Regional

a. Individual taxpayer is ARMD/LTCED RCD/ARMD/LTCED Director/ACIR, Evaluation report o
deceased and no distrainable CS/ACIR, LTS AR/DA recommended
or leviable assets could be duly approved by the
found of Internal Revenue or
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 Revenue Official;

Authenticated copy
certi cate from Philip
Authority (PSA);

Certi cate from the La

Authority (LRA) that
concerned has no prop

Certi cate from the A

of the Local Governm
having jurisdiction of
domicile that the subje
no landholdings;

Copy of the lat

Statements before th
concerned taxpayer
he/she has no distrain
properties;

LTO Certi cation that

taxpayer has no owne

SEC Certi cation tha

taxpayer is not a
incorporator of an
registered with the SEC
a partnership;

Certi cation by the

jurisdiction over t
domicile that the taxp
not filed an estate tax
*** ARMD — shall
prepare the ATCA of Other documents sho
AR/DA cases under deceased delinquent t
NID distrainable/leviable p
RACES/CEMS/LTCED Head of Office, Regional
b. Permanent cessation of RCD/ARMD/LTCED Director/ACIR, Evaluation report o
business AR/DA recommended
CS/ACIR, LTS
duly approved by the
of Internal Revenue or
Revenue Official;

Certi cation from LG

renewal of business pe

SEC Certi cation

Cessation of Busines
taxpayers;

Duly- led Taxpayer

Updates (BIR Form 190

Certi cation from Au

Tax Exemption a
Division (AITIED) th
taxpayer has no cu
transactions;
*** ARMD — shall
prepare the ATCA of Other documents sho
AR/DA cases under delinquent taxpayer h
NID ceased its business op

RACES/CEMS/LTCED Head of Office, Regional

c. Dissolution Evaluation report o
RCD/ARMD/LTCED Director/ACIR,
CS/ACIR, LTS AR/DA recommended
duly approved by the
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 duly approved by the
of Internal Revenue or
Revenue Official;

Certi cate of Dissolut

voluntary dissolution;

SEC certi cation that

registration is
revoked/corporate lif
due to any of the
involuntary dissolu
corporation prov
Presidential Decree No
of voluntary dissolutio

Certi cation from LG

renewal of business pe
*** ARMD — shall
prepare the ATCA of Duly- led Taxpayer
AR/DA cases under Updates (BIR Form 190
NID
Certi cation from
delinquent taxpayer
business transactions

Other documents sho

corporation is already

RACES/CEMS/LTCED Head of Office, Regional

d. Taxpayer is a general Evaluation report o
RCD/ARMD/LTCED Director/ACIR,
partnership and the individual CS/ACIR, LTS AR/DA recommended
partners are already deceased duly approved by the
of Internal Revenue or
Revenue Official;

Authenticated copy
certificate from PSA;

Certi cate from the La

Authority (LRA) that
partners have no prop

Certi cate from the A

of the Local Governm
having jurisdiction of
partners domicile th
taxpayers has no land

Copy of the lat

Statements before th
individual partners
subject taxpayers
distrainable or leviable
*** ARMD — shall
prepare the ATCA of LTO Certi cation that
AR/DA cases under partners have no
NID vehicle;

Certi cation by the

jurisdiction over
individual partner's do
respective heirs did no
tax return;

Other documents sho

deceased delinquent
no distrainable/leviabl

RACES/CEMS/LTCED Head of Office, Regional

e. AR/DA case/s has an Evaluation report o
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 e. AR/DA case/s has an Evaluation report o
RCD/ARMD/LTCED Director/ACIR,
aggregate unpaid amount of CS/ACIR, LTS AR/DA recommended
Php20,000.00 and all duly approved by the
collection enforcement of Internal Revenue or
activities have been fully Revenue Official;
exhausted.

Certi cation from La

Authority (LRA) that th
no distrainable or levia

LTO Certi cation tha

has no owned motor v

SEC Certi cation that

not a shareholder or
any corporation regis
SEC or a partner in a p

Certi cation from LG

renewal of busines
individual taxpayers;

Certi cation from the

taxpayer’s last known
his/her/its whereabou

Certi cation from

delinquent taxpayer
business transactions

Other documents sho

delinquent taxpaye
distrainable/leviable p

ANNEX B
Evaluation Report on Uncollected Accounts Receivable/Delinquent Accounts
(AR/DA)
Recommended for Write-off

ANNEX C
Report on Authority to Cancel Assessment (ATCA) Forms Issued
Administrative Division, Revenue Region No. __________
For the Quarter Ending _______________

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