Enterprises asking about the latest process and requirements for claiming value-added tax (VAT) refund at the Bureau of Internal Revenue (BIR) may now find that new guidelines have recently been released by the state revenue collector.
Revenue Memorandum Circular (RMC) No. 37-2025 prescribes the streamlined procedures and the revised mandatory requirements in the processing and grant of VAT refund claims under Section 112 of the Tax Code, as amended by Republic Act No. 12066 or the CREATE MORE Act.
Issued on April 10, 2025, RMC 37-2025 states that the time frame for processing and granting of claims for VAT refund is 90 days, counting from the date of submission of the certified true copies of the invoices or official receipts and other support documents up to the release of the payment for the approved amount of the refund.
Taxpayers applying to claim unutilized input taxes attributable to VAT zero-rated sales should file their “Application for VAT Credit/Refund Claims” (BIR Form No. 1914) at the VAT Credit Audit Division (VCAD) in the national office.
The types of VAT zero-rated sales covered here include direct export sales of goods, regardless of the percentage of export sales to total sales; direct export sales of services, regardless of the percentage of export sales to total sales; sale of goods to persons engaged in international shipping or international air transport operations; services rendered to persons engaged in international shipping or international air transport operations; and transport of passengers and cargo by domestic air or sea vessels from the Philippines to a foreign country.
On the other hand, taxpayer-claimants not covered by the above provision should file their VAT refund claims at the VAT Audit Section (VATAS) of the Assessment Division of Regional Offices, the respective Revenue District Office if without VATAS, or the Large Taxpayers VAT Audit Unit of the Large Taxpayers Service. Applications for VAT refund should be filed at these offices for the following types of zero-rated sales:
• Sale of raw materials or packaging materials to a non-resident buyer for delivery to a resident local export-oriented enterprise to be used in manufacturing, processing, packing or repacking in the Philippines of the said buyer’s goods
• Processing, manufacturing or repacking goods for other persons doing business outside the Philippines whose goods are subsequently exported
• Sale of power or fuel from renewable energy sources
• Those with effectively zero-rated sales for the following: sale of goods and services to an export-oriented enterprise (EOE); sale of goods to bonded manufacturing warehouses of EOEs; sales of goods and services to persons or entities covered under special laws or international agreements; and sale of goods and services to registered business enterprises covered under Title XIII of the Tax Code
• Taxpayers whose VAT registration has been cancelled or changed in the VAT registration status to non-VAT but with accumulated unutilized input taxes
RMC 37-2025 further provides that VAT refund claims should be physically or manually filed at the designated processing office to be validated for completeness of the documentary requirements submitted.
Only applications with complete documentary requirements will be received and processed by the authorized processing office.
For VAT refund claims where the period covered starts from April 1, 2025, taxpayer-claimants should take note of the following rules:
• No refund of input VAT shall be allowed for the EOE that attained the 70% threshold from the preceding taxable year in case the local suppliers passed on the VAT on the local purchases of goods directly attributable to the former’s export activity for the immediately succeeding year despite securing VAT zero-rating certificate from the Export Marketing Bureau (EMB) of the Department of Trade and Industry. In such cases, the qualified exporter may contest the same and/or resolve with the local supplier for the reimbursement of the VAT paid, if any, or convert the transaction from 12% VAT to VAT at zero percent.
• The EMB will accept applications of EOEs for VAT zero-rating on their local purchases and VAT exemption on their importations and certify the direct export sales of qualified taxpayer-claimants. The BIR will verify the export sales of the taxpayer-claimant based on the certification issued by the EMB.
• EOEs that have attained the 70% export threshold from the preceding taxable year but failed to secure certification from the EMB will not be allowed for VAT refund covering the immediately succeeding year. However, the unutilized input VAT may be carried forward to the subsequent taxable quarters and can be utilized against future VAT liabilities.
• For EOEs that failed to meet the threshold from the preceding year and would claim for refund the input taxes from their local purchases attributable to zero-rated sales on the immediately succeeding year, the copy of the notification from the EMB with a clear statement that sales from the preceding year is below the 70% threshold must be submitted. This proves that the immediately succeeding year is not qualified for VAT zero-rating on local purchases and is therefore subject to 12% VAT.
• For taxpayer-claimants that have purchases from registered business enterprises (RBEs) covered under Revenue Regulations No. 9-2025, no input VAT shall be claimed until the corresponding VAT has been paid on the purchase from RBE-sellers.
The following documents are required for the local buyers of RBEs: Sales invoice issued by the RBE showing the amount of VAT on local sales, and copy of the corresponding duly filed BIR Form No. 1600VT or BIR Form No. 0605, whichever is applicable.
RMC 37-2025 also includes the checklist of documents to be submitted upon filing of the application for VAT refund. The circular takes immediate effect.