BIR Form 1707-A Penalty for Late Filing: A Worked Example

BIR Form 1707-A consolidates every sale of unlisted domestic shares a taxpayer made during the year, each already taxed at 15% on its own BIR Form 1707 — so a late BIR Form 1707-A usually isn’t a late tax payment at all, it’s a late information return, carrying its own Section 250 and RMO No. 7-2015 exposure separate from the 15% final tax already remitted per transaction. This post works through a shareholder who sold shares twice in one year and filed the annual consolidating return 35 days late.

Why is a late BIR Form 1707-A usually not a late-tax penalty? #

Because BIR Form 1707-A restates transactions that were each already taxed and paid within 30 days of the sale on their own BIR Form 1707, the annual return typically carries no additional tax of its own — so the late-filing exposure is the Section 250 penalty for a late information return plus an RMO No. 7-2015 compromise for late filing, not the Section 248 surcharge and Section 249 interest that attach to unpaid tax. This is a structurally different penalty profile from a return like BIR Form 2551Q or BIR Form 1701Q, where filing late is almost always also paying late. For the mechanics of the return itself, see BIR Form 1707-A: The Annual Capital Gains Tax Return for Shares of Stock.

That changes, though, if reconciling the year’s sales on BIR Form 1707-A turns up a shortfall — a transaction where less than 15% was actually remitted on the original BIR Form 1707. That shortfall is a real deficiency, and it carries the full surcharge-and-interest treatment from the original 30-day deadline, not from the annual return’s own due date.

The scenario: two share sales, consolidated 35 days late #

An individual shareholder sold unlisted shares in a domestic corporation twice during 2026 — once in March and once in September — remitting the correct 15% final tax on each sale within 30 days, via two separate BIR Form 1707 filings. The shareholder’s accountant, however, filed the consolidating BIR Form 1707-A on May 20, 2027, 35 days after the April 15, 2027 deadline, with no additional tax due on the annual return itself since both transactions were already correctly taxed.

Step 1: the Section 250 information-return penalty #

Because no additional tax is due, late filing of BIR Form 1707-A is penalized as a failure to file a required information return under NIRC Section 250 — the same provision this site’s BIR Form 2306 guide applies to a late certificate — rather than under the surcharge provision meant for unpaid tax. Section 250 fixes this at a flat amount per failure:

“In the case of each failure to file an information return, statement or list, or keep any record, or supply any information required by this Code or by the Commissioner on the date prescribed therefor, unless it is shown that such failure is due to reasonable cause and not to willful neglect, there shall, upon notice and demand by the Commissioner, be paid by the person failing to file, keep or supply the same, One thousand pesos (P1,000) for each such failure: Provided, That the aggregate amount to be imposed for all such failures during a calendar year shall not exceed Twenty-five thousand pesos (P25,000).”

— National Internal Revenue Code, Section 250

One late BIR Form 1707-A is one failure: ₱1,000.

Step 2: the RMO No. 7-2015 compromise penalty #

Separate from the Section 250 amount, RMO No. 7-2015’s Annex A schedule also suggests a compromise penalty for late filing of a required return, offered in lieu of pursuing the matter as a criminal referral under Section 255. For a late annual information-type return with no tax due, this generally falls in a lower bracket than the unpaid-tax compromise schedule used for a return like BIR Form 2551Q — treat the exact current bracket amount as something to confirm with your RDO or the BIR, since RMO No. 7-2015’s schedule varies by return type and whether tax is involved.

The full worked total #

Compare this to what would have happened had Sale 2’s ₱37,500 tax actually been underpaid by, say, ₱10,000 and only caught when BIR Form 1707-A was reconciled: that ₱10,000 shortfall would carry a 25% Section 248 surcharge (₱2,500) and Section 249 interest at 12% per annum running from the original 30-day BIR Form 1707 deadline in October 2026 — not from the April 2027 annual-return deadline — on top of the ₱1,000 and compromise penalty above. Filing the annual return late is a comparatively small, flat exposure; a hidden transaction-level shortfall is not.

How to avoid this #

1. File each BIR Form 1707 correctly and on time within 30 days of every sale during the year — that’s where the real 15% tax exposure sits, not on the annual return.
2. Keep a running log of every share disposition during the year, so BIR Form 1707-A can be prepared from a complete list rather than reconstructed from memory close to the April 15 deadline.
3. Reconcile each transaction’s reported gain and tax paid against the BIR Form 1707-A consolidation before filing, to catch any shortfall while it’s still a flat information-return penalty rather than a deficiency with surcharge and interest running since the original sale.
4. Calendar April 15 (or the fiscal-year equivalent) for BIR Form 1707-A the same way any other annual return deadline is calendared, even though no cash payment is typically expected with it.

Frequently asked questions #

Is the BIR Form 1707-A penalty based on the 15% capital gains tax again? #

No, not in the ordinary case. BIR Form 1707-A consolidates transactions that were each already taxed and paid via their own BIR Form 1707 within 30 days of the sale. When no additional tax becomes due on the annual return itself, the late-filing exposure is the Section 250 information-return penalty and an RMO No. 7-2015 compromise for late filing, not a fresh surcharge and interest computed on the 15% tax — those attach only if the annual return reveals additional unpaid tax.

What if BIR Form 1707-A shows additional tax due that wasn’t paid on time? #

If reconciling the year’s transactions on BIR Form 1707-A reveals that less than the correct 15% final tax was actually paid on one or more of the underlying sales, that shortfall is a deficiency subject to the full Section 248 surcharge and Section 249 interest, computed from the original BIR Form 1707 due date for that transaction — not from the BIR Form 1707-A annual deadline.

Does late filing of BIR Form 1707-A alone (no additional tax) still carry a penalty? #

Yes. Even with zero additional tax due, BIR Form 1707-A is a required annual return, and filing it late exposes the taxpayer to an RMO No. 7-2015 compromise penalty for late filing of an annual information-type return, assessed separately from any surcharge or interest tied to actual unpaid tax.

Is the BIR Form 1707-A deadline the same for individuals and corporations? #

Both land on the 15th day of the fourth month after the taxable year closes, which works out to April 15 of the following year for any calendar-year filer, individual or corporate. A corporation on a fiscal year counts four months from its own fiscal year-end instead of from December 31.

Does filing BIR Form 1707-A late affect the validity of the capital gains tax already paid per transaction? #

No. The 15% final tax paid with each individual BIR Form 1707 is a completed, final transaction-level payment on its own 30-day deadline. A late BIR Form 1707-A doesn’t unwind or invalidate those earlier payments — it’s a separate, later information-consolidating filing with its own penalty exposure.

Summary #

A BIR Form 1707-A filed late with no additional tax due costs a flat ₱1,000 Section 250 penalty plus an RMO No. 7-2015 compromise for the late information return — a much smaller exposure than the surcharge-and-interest penalty that applies when the annual reconciliation instead uncovers an underpaid transaction. The two profiles come from the same return but different triggers: filing late alone is an information-return problem; an uncovered shortfall is a deficiency-tax problem running from the original sale’s own 30-day deadline. For the return’s underlying mechanics, see BIR Form 1707-A: The Annual Capital Gains Tax Return for Shares of Stock; for the general penalty framework these rates come from, see BIR Late Filing Penalties: Section 248 Surcharge, Section 249 Interest, and RMO No. 7-2015 Compromise. Confirm the current RMO No. 7-2015 compromise bracket with your RDO before paying.