Taxation, 2019 Bar — Question B.17

QUESTION

XYZ Corp. is listed as a top 20,000 Philippine corporation by the Bureau of Internal Revenue. It secured a loan from ABC Bank with a 6% per annum interest. All interest payments made by XYZ Corp. to ABC Bank are subject to a 2% creditable withholding tax. At the same time, XYZ Corp. has a trust deposit with ABC Bank in the amount of P100,000,000.00, which earns 2% interest per annum, but is subject to a 20% final withholding tax on the interest income received by XYZ Corp. (a) Who are the withholding agents in the case of: 1. the 20% final withholding tax; and 2. the 2% creditable withholding tax? Explain. (2.5%) (b) When is the deadline for filing a judicial claim for refund for any excess or erroneous taxes paid in the case of: 1. the 20% final withholding tax; and 2. the 2% creditable withholding tax? (2.5%)

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