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REVENUE MEMORANDUM CIRCULAR (RMC) NO. 84-2026
This Circular clarifies certain provisions of RR No. 004-2026, which prescribes the guidelines and procedures for the One-Time Abatement Program for Micro Taxpayers under Section 204(B) of the Tax Code, as amended, in relation to the taxpayer classification under Section 21(B), as amended by Republic Act (RA) No. 11976 (Ease of Paying Taxes Act), and implemented by RR No. 8-2024.
| Question | Answer |
| Q1. What is the basis for tagging a taxpayer as a Micro Taxpayer? | Classification is based on the taxpayer’s status in the Internal Revenue Integrated System – Taxpayer Registration System (IRIS-TRS) as of December 31, 2025, verifiable through BIR Online Registration and Update System (ORUS) or by coordinating with the taxpayer’s Revenue District Office (RDO). |
| Q2. What are the documents that need to be submitted to avail of the One-Time Abatement Program? | • Three (3) copies of the duly accomplished Application Form (BIR Form No. 2121) • Photocopy of a valid government-issued ID: a. Taxpayer’s ID (for individuals), or b. Sole stockholder’s ID (for One Person Corporations) or Corporate Secretary’s ID (for non-individuals) • Proof of authority for filing through a representative, as applicable: a. Duly notarized Special Power of Attorney (SPA) for individual taxpayers, or b. Duly notarized Board Resolution or Written Resolution (for One Person Corporations), or Secretary Certificate, authorizing the representative for non-individual taxpayers • Photocopy of the authorized representative’s valid government-issued ID (if applicable) • Certificate of Existence of Outstanding Tax Liability/ies (CEOTL) • Copy of the Preliminary Assessment Notice (PAN), Final Assessment Notice (FAN), Formal Letter of Demand (FLD), or Final Decision on Disputed Assessment (FDDA) with corresponding assessment details, if applicable • Letter of withdrawal of any pending compromise or abatement application, duly received by the Regional Collection Division, if applicable |
| Q3. What is the CEOTL and where can the taxpayer secure it? | The CEOTL is the official document showing the taxpayer’s outstanding liability as of December 31, 2025, the tax type(s) and taxable year(s) involved, and other qualification details, and is controlling for coverage determination. It is secured from the concerned Issuing Office (Regional Collection Division, Office of the Regional Director, Legal Division, or RDO, depending on the case type) prior to filing, and issued within two (2) working days from request. |
| Q4. Can a taxpayer who earns both compensation income and business income qualify for abatement? | Yes, provided the taxpayer is classified as a Micro Taxpayer and the liability sought to be abated is covered under Sections 3 and 4 of RR No. 004-2026. |
| Q5. Where and how should the Micro Taxpayer file the application for One-Time Abatement? | Applications are filed manually with the RDO where the taxpayer is registered (or the RDO with jurisdiction over the Head Office, for taxpayers with multiple branches), using BIR Form No. 2121. All applicable tax types must be manually indicated for covered cases with multiple tax types, with the aggregate amount due specified; failure to do so results in denial. |
| Q6. What is the Alphanumeric Tax Code (ATC) for the One-Time Abatement? | MC350 for individual taxpayers and MC351 for non-individual taxpayers. |
| Q7. RR No. 004-2026 states that taxpayers shall use BIR Form No. 0605 for payment of the Five Thousand Pesos (₱5,000.00) abatement fee. What should be indicated in Item 8 (Tax Type) of BIR Form No. 0605 if multiple tax types are involved? | The code “MA” shall be indicated in Item 8 (Tax Type) of the BIR Form No. 0605, regardless of the tax type(s) involved. Meanwhile, the ₱5,000.00 abatement fee shall be indicated in Item 21 of the same BIR Form. The fee shall be filed and paid either electronically or manually, within five (5) working days from filing the application, with proof of payment submitted within five (5) working days from payment. Late submission voids the application, without prejudice to re-filing within the availment period. The fee is non-refundable but is applied as partial payment in case of denial or withdrawal. |
| Q8. May a Micro Taxpayer with a pending application for compromise settlement avail of the One-Time Abatement Program? | Yes, provided the taxpayer withdraws the pending compromise application before the Regional Collection Division and submits proof of withdrawal with the abatement application. |
| Q9. May a Micro Taxpayer with a pending application for abatement of penalties under RR No. 13-2001 avail of the One-Time Abatement Program? | Yes, under the same withdrawal requirement applicable to pending compromise applications. |
| Q10. Is the filing of the application for One-Time Abatement considered deemed withdrawal of a pending administrative appeal against the PAN, FAN/FLD, or FDDA covered by the application? | No. The administrative appeal is instead suspended while the abatement application is pending, and resumes if the application is denied, voided, or withdrawn. |
| Q11. Does the one-time abatement cover taxes due arising from one-time transactions (e.g. sale of real property, sale of shares of stock, donation, etc.)? | Yes, provided that: a. The statutorily liable taxpayer for the tax sought to be abated is classified as a Micro Taxpayer; b. The liability is covered under Section 4 of RR No. 004-2026; and c. The certified covered liability as of December 31, 2025 does not exceed ₱80,000.00. |
| Q12. What types of penalties are covered by the one-time abatement program? | Interests, surcharges, open case penalties, and compromise penalties under RMO No. 7-2015, as amended, arising from liabilities covered under Section 4 of RR No. 004-2026. For purposes of the ₱80,000.00 threshold, unpaid basic taxes and compromise penalties are included, while surcharges and interests are excluded. |
| Q13. Are Run After Tax Evaders (RATE) cases and fraud cases covered by the One-Time Abatement Program? | As a general rule, RATE cases and other tax fraud cases are not covered, unless allowed by the Commissioner or a duly authorized representative on meritorious grounds, supported by written approval in addition to the other required documents. |
| Q14. May open case liabilities from different taxable years be covered by the One-Time Abatement Program? | Yes. The taxpayer may choose the taxable year/s for which to avail the One-Time Abatement Program and must file a separate application and pay the ₱5,000.00 fee for each taxable year, with the ₱80,000.00 threshold applied separately per year. Only open cases existing as of December 31, 2025 are covered. |
| Q15. A Micro Taxpayer has unpaid penalties from open cases and violations of the provisions of the Tax Code in the total amount of ₱100,000.00 for the entire taxable year. Can the taxpayer apply for the abatement of her penalties? | No, since the aggregate unpaid penalties for the taxable year exceed the ₱80,000.00 threshold. |
| Q16. Does the Micro Taxpayer need to file the unfiled returns in order to close the open cases? | No, provided the open case liabilities qualify under RR No. 004-2026 and there is no unpaid tax due, the taxpayer may avail of the One-Time Abatement Program without filing the corresponding unfiled returns. |
| Q17. When a Micro Taxpayer, whether actively engaged in business or has ceased operations already or still actively engaged in business who has unfiled returns wishes to update and rectify their registration and tax records with the Bureau as of December 31, 2025, is the taxpayer still qualified to avail of the One-Time Abatement Program under RR No. 004-2026? | Yes, provided all qualifications and requirements under RR No. 004-2026 are satisfied. The taxpayer may file the appropriate unfiled returns to rectify records without being precluded from availing of the One-Time Abatement Program. |
| Q18. Section 4 of RR No. 004-2026 refers to “delinquent or assessed basic tax.” Does this mean that interests and surcharges are excluded in the abatement program? | Interests and surcharges are excluded for threshold-determination purposes but are abated along with the basic tax if the basic tax itself falls within the threshold and is abated. Compromise penalties, not being incidental to the basic tax, are included in the threshold computation. |
| Q19. Based on the Formal Letter of Demand/Final Assessment Notice, the following are the deficiency taxes due against Ms. NKS, who is classified as a Micro Taxpayer, for taxable year 2019: Tax Type Basic Tax Due Interest Income Tax (IT) ₱ 80,000.00 ₱ 28,800.00 Value-Added Tax (VAT) ₱ 50,000.00 ₱ 18,000.00 Expanded Withholding Tax (EWT) ₱ 2,500.00 ₱ 900.00 TOTAL ₱ 132,500.00 ₱ 47,700.00 Can Ms. NKS validly file an application for one-time abatement for taxable year 2019 under RR No. 004-2026? | No. Withholding tax liabilities of a Micro Taxpayer are covered by the One-Time Abatement Program and are aggregated with all other unpaid basic taxes for the taxable year in applying the threshold. Here, the aggregate basic tax due across all tax types totals ₱132,500.00 (₱80,000.00 for IT + ₱50,000.00 for VAT + ₱2,500.00 for EWT), which exceeds the ₱80,000.00 threshold. Ms. NKS is therefore not qualified to avail herself of the Program. |
| Q20. Given the same facts in Q19, can Ms. NKS file an application for one-time abatement only for her deficiency IT assessment? | No. All unpaid deficiency taxes for the taxable year subject of the application must be included in the application for abatement and considered in determining compliance with the threshold requirement. Failure to include all unpaid covered liabilities is a ground for denial. |
| Q21. If the original basic tax is above the ₱80,000.00 threshold but was reduced to ₱80,000.00 or less, through payments made on or before December 31, 2025, may the taxpayer still qualify? | Yes. Payments made on or before December 31, 2025 are considered, applied first against interests, surcharges, and compromise penalties, with any remainder applied against the basic tax. If the resulting basic tax is ₱80,000.00 or less, the taxpayer qualifies. |
| Q22. May amounts previously paid on covered cases be refunded or credited by reason of abatement? | No. Amounts paid on or before December 31, 2025 are applied against the liability but are not refunded or credited. |
| Q23. When may the application for abatement be denied? | An application for abatement may only be denied on any of the following grounds: 1. Taxpayer classification – The applicant is not a Micro Taxpayer as of December 31, 2025. 2. Timeliness – The application was filed after December 31, 2026, unless the availment period has been extended by the Secretary of Finance upon recommendation of the Commissioner. 3. Out of scope – The assessed tax or penalty sought to be abated did not exist as of December 31, 2025. 4. Out of coverage – The tax or penalty sought to be abated does not fall within the cases covered under Section 4 of RR No. 004-2026. 5. Threshold exceeded – The aggregate amount of all applicable cases covered under Section 4 of RR No. 004-2026 exceeds ₱80,000.00. 6. Non-payment of abatement fee – The taxpayer failed to pay the abatement fee within five (5) working days from filing the application. 7. Incomplete application – The taxpayer failed to specify the tax types and basic amount due in any covered case. 8. Lack of required approval – For RATE cases and other fraud cases not yet filed in court, the approval of the Commissioner or duly authorized representative was not obtained. 9. Material misrepresentation – The application or supporting documents contain material misrepresentations or falsified information; any availment already granted becomes void ab initio, without prejudice to applicable civil and criminal liabilities. Non-submission of proof of payment within five (5) days from the date of payment is not a ground for denial but automatically voids the application without prejudice to re-filing within the availment period. |
| Q24. Is an application filed on or before December 31, 2026 but processed thereafter considered timely? | Yes. Timeliness is determined by the date of filing, not the date of approval. |
| Q25. Does the filing of an application for one-time abatement suspend the collection enforcement activities against the Micro Taxpayer? | Yes, starting from filing with complete requirements and while the application remains pending; the suspension lifts upon denial, voidance, or withdrawal. |
| Q26. What is the Certificate of Availment, and what is its significance? Is the format different for each RDO? | The Certificate of Availment is the official document, signed by the RDO (or Assistant RDO in the RDO’s absence), evidencing approved availment. It serves as the basis for issuing the corresponding Authority to Cancel Assessment (ATCA) and is issued within five (5) working days from receipt of proof of payment. |
| Q27. May the Certificate of Availment be used to support an application for closure/cancellation of business registration? | Yes, though issuance of the Certificate does not automatically trigger closure/cancellation, which still requires the proper application under RMC No. 047-2026. |
| Q28. Will Micro Taxpayers be audited upon filing of an application for one-time abatement? | No. Evaluation is based solely on submitted documents, with RDO verification limited to taxpayer’s classification, outstanding liability, fee payment, and compliance with requirements. The filing does not suspend or waive audits or assessments for taxable years or cases not covered by the application. |
| Q29. May the information disclosed in the application be used for other purposes? | No. Information disclosed is covered by the confidentiality provisions of Section 270 of the NIRC of 1997, as amended. |