REVENUE REGULATIONS NO. 10-2005 issued on May 30, 2005 amends certain provisions of Revenue Regulations (RR) No. 6-2005, as a result of the amendment of Section 2 of Executive Order (EO) No. 399, which directs the BIR to establish the “No Audit Program” (NAP). The criteria for taxpayers to be qualified under the NAP has been amended to read as follows: a. Income Tax payment for the Current Taxable Year must exceed the Income Tax payment for the Base Year by at least 20% b. ratio of Income Tax payment to gross sales/receipts for the Current Taxable Year must be at least equal to that of Base Year c. ratio of net Value-Added Tax (VAT) or business tax actually paid to gross sales/receipts for the Current Taxable Year must be at least equal to that of the Base Year, provided, however, that in no case shall it be less than 3% for those subject to Percentage Tax, or 30% of the VAT rate provided by law for any given period for those subject to VAT, or the industry benchmark as may be determined from time to time by the Commissioner Internal Revenue. In determining tax payments for the Current Taxable Year, only taxes actually paid in cash as shown in the tax return shall be considered. For this purpose, creditable withholding taxes for taxes withheld for the tax year concerned, which are properly supported by a Certificate of Tax Withheld (BIR Form 2307) shall be considered as cash payments. On the other hand, Tax Credit Certificates (TCCs)/Tax Debit Memos (TDMs) and tax credit carried over from prior years are considered non-cash items and shall be excluded in the determination of tax payments for the Current Taxable Year. However, for purposes of determining tax payments for the Base Year from which the increase in tax payments and ratio required to qualify for the NAP shall be measured, the total amount of tax due for the Base Year shall be included regardless of the mode of payment. In the event the taxpayer was not in operation for the whole period of the Base Year, the tax payments for that period shall be annualized. The annualized tax payments shall be used as the tax payment of the Base Year from which the growth and ratio required shall be computed. A taxpayer must file an application form, duly accomplished, together with all its attachment not later than thirty (30) days from the statutory deadline for the filing of the annual Income Tax return for the year subject of the application, or in the case of those taxpayers whose statutory deadline for filing their annual Income Tax returns occurred earlier than the date of the effectivity of these Regulations, their application must be filed within thirty (30) days from the effectivity hereof. Only taxpayers whose annual income tax returns were not amended may apply to participate in the NAP. In the event the amount of taxes paid shall not be sufficient to qualify a taxpayer for the NAP, he may still qualify by making a voluntary payment in an amount not less than the deficiency required for him to qualify. Provided, that said payment shall be nonrefundable nor deductible against his income. Provided, further, that said voluntary payment shall form part of the base of the tax year for which it was, for purposes of determining his qualification for NAP in the subsequent tax year.