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Frequently Asked Questions & Answers on Completion of Profits Tax Returns [BIR54] issued on or after 3 April 2017

Introduction

For the benefit of the tax paying public and their tax representatives, some frequently asked questions and their answers are listed below for general information and guidance.

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1.

Q:

The company is required to declare in BIR54 the assessable profits made by the non-resident person during the basis period for the year of assessment. Does "basis period" here refer to the basis period of the non-resident person?

 
 

A:

Yes. It does not refer to the basis period of the company.

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2.

Q:

The company does not know the accounting date (and therefore the basis period) of the non-resident person, can I use 31 March as the accounting date?

 
 

A:

Yes. For simplicity sake, you need not spend effort to ascertain the accounting date of the non-resident person. However, if the non-resident person wants to claim the lower tax rate pursuant to the respective double taxation agreement/arrangement, the basis period must refer to that of the non-resident person.

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3.

Q:

In practice, the company finds it more convenient to use its own basis period for reporting sums such as royalty paid. Can I use the company's basis period (instead of 1 April to 31 March or the non-resident's basis period) in completing BIR54?

 
 

A:

Yes. You should use this basis period consistently. However, if the non-resident person wants to claim the lower tax rate pursuant to the respective double taxation agreement/arrangement, the basis period must refer to that of the non-resident person.

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4.

Q:

This year, the company wants to use a basis period different from that used in past years. Is this a change of accounting date situation to which s.18E applies?

 
 

A:

Yes. You should explain in a separate sheet why a different basis period is used this year.