[Ask the Tax Whiz] Temporary suspension of BIR audit: Are you affected?

The Bureau of Internal Revenue (BIR) has ordered a temporary suspension of its field audit operations nationwide, a directive formalized under Revenue Memorandum Circular (RMC) No. 107-2025, issued on November 24, 2025. This move, initiated under the leadership of the new BIR Commissioner, Charlito Martin R. Mendoza, is an institutional response to concerns regarding the integrity and fairness of the tax audit process. Understanding this suspension and its implications is vital for maintaining proactive tax risk management.

What is the primary objective of the audit suspension?

The primary objective of the audit suspension under RMC 107‑2025 is to enable the BIR to implement a more comprehensive internal review of its tax audit policies and procedures, strengthen internal safeguards, and ensure that the issuance of Letters of Authority (LOAs) and Mission Orders (MOs) follows the rule of law, advancing the protection of taxpayer rights.

Unlike the annual “Stop Audit,” which was a fixed, short-term pause mostly affecting routine audits, the current suspension was implemented earlier, includes stronger internal controls, covers both new and ongoing audits, and will remain in effect until lifted by the Commissioner.

Which tax audits and operations are explicitly excluded from the suspension?

It is crucial to note that RMC No. 107-2025 does not constitute a total freeze on all BIR examinations. The following critical and time-sensitive operations are explicitly excluded and will proceed:

What actionable steps should taxpayers take during this period?

While the temporary suspension alleviates immediate audit pressure, the expectation is that the ensuing audit system will be more stringent and standardized. Therefore, businesses should use this period for critical internal preparation.

1. Conduct a Tax Exposure Review: Businesses should proactively use this time to conduct an internal review of their tax records for recent years. The focus should be on identifying and correcting potential tax deficiencies related to common audit findings, particularly in areas such as substantiation of claimed expenses, withholding tax compliance, and proper documentation for input Value-Added Tax (VAT) claims.

1. Optimize Document Management: A critical component of audit readiness is document retrieval efficiency. Taxpayers should ensure that all financial records, official receipts, invoices, and other supporting documents are systematically organized and accessible. Streamlining this process now will lead to a faster and less disruptive experience when audits resume.

1. Maintain Regular Compliance: The temporary suspension pertains strictly to field audit operations and does not affect the obligation to file and pay all taxes (i.e., income, VAT, withholding, etc.) accurately and on time. Maintaining consistent, accurate compliance is non-negotiable and the best mitigation strategy against future assessments.

The BIR’s directive presents an opportunity for the Bureau to implement procedural reforms and for taxpayers to reinforce their internal controls and compliance posture. – Rappler.com

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