HOW TO CANCEL YOUR TIN OR CLOSE YOUR BUSINESS REGISTRATION WITH THE BIR.

I had an encounter with individuals having problems with their TIN. One of which is the case of the daughter of my husband's friend. After she graduated from college, she was able to pass as an insurance agent of one  insurance company. Her income will be more of a commission basis. Since there was no employer-employee relationship between her and the company,  she applied for TIN as a self-employed individual. But, for some reason, she did not continue with her plan to be an insurance agent. She, then, took  further studies without informing the BIR of her change of plan.

To cut the story short, she had problems with the BIR when she finally was employed by another company. Her TIN needed to be transferred to another Revenue District Office (RDO) where her employer was registered but it was verified that the TIN had open cases. It was also learned that she did not filed the applicable tax returns or paid the tax liabilities as self employed. 

Please be informed, that,  if ever you will register as self-employed, you have the obligation to file certain tax returns with or without tax due or payable and renew and pay your annual registration fee. (see Business Registration)

Moreover, even if the business becomes insolvent, you are, still, required to file annually, monthly and quarterly your corresponding tax returns. You need to indicate in the return that it is non-operational until such time that you have formally declared it close or have cancelled your TIN registration as a self-employed.

To discontinue or terminate your registration, I found out from the BIR website the following documentary requirements and procedures:

BIR Form 1905 (Application for Registration Information Update) together with the following:

1) Letter of request stating reason for termination of business
2) Original Certificate of Registration
3) Books of Accounts
4) Inventory List of Unused Receipts and Invoices
5) Unused Receipts and Invoices for cancellation
6) Board Resolution / Notice of Dissolution (if Corporation / Partnership)

Procedures:
1) Taxpayer applicant files BIR Form 1905, together with the attachments at the RDO where they are registered within ten (10) days from retirement of business/cancellation of TIN.
2) Taxpayer files short period return for income tax purposes.
3) RDO verifies if taxpayer has open cases reflected in the Integrated Tax System (ITS). If YES, ask taxpayer to submit required returns and pay the corresponding tax due/s and penalties if any.
4) RDO verifies if taxpayer has delinquent cases at the Assessment, Collection, and Legal Divisions of the Region;
5) RDO verifies if taxpayer has delinquent cases at the Collection Enforcement Division, BIR National Office
6) RDO requests for Letter of Authority to investigate internal revenue taxes for all un-audited taxable years prior to cancellation of business.
7) Assigned Case officer conducts investigations for period/s covered in the issued Letter of Authority.
8) Taxpayer complies with requirements of audit and pays corresponding deficiency taxes resulting from audit using Form 0605.
9) RDO issues tax clearance for closure of business.
10) RDO updates ITS and cancels TIN of taxpayer (for non-individual taxpayer).

(see also Application for Closure of Business/Cancellation of TIN).

For other concern, we suggest that you coordinate with the Officer of the Day (OD) of the RDO where you are registered regarding the correct procedure to finally close your registration.