Delisted From the BIR Top Withholding Agent List Mid-Year? What Happens to QAP and the 1%/2% Withholding
A company removed from the BIR’s Top Withholding Agent (TWA) list stops applying the 1% (goods) / 2% (services) TWA withholding rate on the first day of the month following the BIR’s publication of the delisting — not automatically, and not retroactively. It does not, however, stop filing the Quarterly Alphalist of Payees (QAP): QAP tracks whatever expanded withholding tax (EWT) the company withholds as an ordinary agent, which for most delisted companies means it keeps filing, just with a narrower set of payees.
Stay on Top of Your QAP Filings FREE →This guide builds on Who Is a BIR Top Withholding Agent?, which covers how a company gets classified as a TWA in the first place and briefly confirms that delisting is possible; this post works through what actually changes operationally — and what doesn’t — the quarter it happens. For QAP mechanics generally, see What Is QAP?.
How does a company get removed from the TWA list in the first place? #
The BIR does not delist a company the moment its revenue drops below the classification threshold — delisting, like inclusion, only takes effect once the BIR itself publishes an updated list removing the taxpayer. The framework traces back to Revenue Regulations (RR) No. 11-2018, which amended Section 2.57.2 of RR No. 2-98 to create the 1%/2% TWA withholding rule, and Revenue Memorandum Order (RMO) No. 26-2018, which set the BIR’s own procedures for monitoring, adding, and deleting taxpayers from the TWA list. The BIR has since periodically circularized updated lists — split into additions and deletions — through RMCs such as RMC No. 86-2018 (the initial list under RR No. 11-2018, effective November 1, 2018) and successive updates in later years, each naming its own effectivity date.
RR No. 7-2019, which replaced the original tiered classification with the current ₱12,000,000 gross-sales/purchases/expenses test, carried the same delisting logic forward: a taxpayer already classified as a TWA stays classified even after its revenue falls below the threshold, until the BIR itself publishes it as removed from the list. Nothing about falling revenue, on its own, ends the obligation — only the BIR’s own publication does.
What actually changes on the delisting’s effective date? #
The delisting only switches off the TWA-specific 1%/2% rule on regular suppliers — it does not switch off withholding altogether. The 1%/2% TWA rule under RR No. 11-2018 was built specifically around “regular suppliers,” and that same regulatory text is what stops applying once delisting takes effect:
“Regular suppliers” refer to suppliers who are engaged in business or exercise of profession/calling with whom the taxpayer-buyer has transacted at least six (6) transactions, regardless of amount per transaction, either in the previous year or current year. As a general rule, this term does not include a casual purchase of goods/services that is purchase made from a non-regular supplier and oftentimes involving a single purchase. However, a single purchase which involves Ten thousand pesos (₱10,000.00) or more shall be subject to withholding tax under this subsection.
— Section 2.57.2 of RR No. 2-98, as amended by RR No. 11-2018 (also cited in The “Regular Supplier” Rule for BIR Form 2307)
That’s the specific rule a delisted company stops applying to its local goods and services suppliers from the effective date forward. What survives delisting is every other EWT category that was never tied to TWA status to begin with — rent, professional fees, commissions, and contractor payments, among others, each governed by its own long-standing ATC and rate under the general EWT rules, independent of whether the payor happens to be a Top Withholding Agent.
| Payment type | Before delisting (as TWA) | After delisting takes effect |
|---|---|---|
| Local purchase of goods from a regular supplier | Withheld 1% (ATC WC158/WI158) | No longer withheld under the TWA rule |
| Local purchase of services from a regular supplier | Withheld 2% (ATC WC160/WI160) | No longer withheld under the TWA rule |
| Office/warehouse rent | Withheld 5% | Still withheld 5% — unaffected by TWA status |
| Professional fees to a retained consultant | Withheld 10%/15% | Still withheld — unaffected by TWA status |
| Payments to a contractor/subcontractor | Withheld 2% | Still withheld — unaffected by TWA status |
Does QAP filing stop when TWA status ends? #
No — QAP is filed by any withholding agent that deducts EWT during the quarter, not exclusively by Top Withholding Agents, so a delisted company that still withholds on rent, professional fees, or contractor payments keeps filing QAP for those payees. What changes is the composition of the alphalist, not whether one gets filed: the TWA-rate goods/services rows (ATC WC158/WI158/WC160/WI160) fall away from the effective date forward, while the rows for the payment types every ordinary withholding agent still covers continue exactly as before.
The only scenario where QAP filing genuinely stops is one where the company, once delisted, makes no withholdable payments of any kind for a full quarter — no rent, no professional fees, no contractor payments, nothing. That’s a narrower and less common outcome than most delisted companies actually experience, and it’s covered separately in Do You Still Need to File RELIEF, SAWT, or QAP If You Have No Transactions This Period?, which explains why even a quiet period generally still ties back to the underlying return rather than ending the filing obligation outright.
Timeline and checklist for a mid-year delisting #
A delisting event has a clear sequence — publication, then a following-month effective date, then a transition quarter where the QAP composition changes partway through — and treating each step out of order is the most common way a company either over-withholds or under-withholds during the switch. Use this checklist against the specific RMC or notice naming the company’s removal:
| Step | Action | Timing |
|---|---|---|
| 1 | Confirm the company’s name and TIN actually appear on the BIR’s published deletion list, not just an internal revenue estimate | As soon as an updated list or notice is issued |
| 2 | Identify the stated effective date (typically the first day of the month following publication) | From the specific RMC or BIR notice |
| 3 | Continue withholding 1%/2% on regular suppliers for every purchase up to the day before the effective date | Through the end of the prior month |
| 4 | Stop applying the 1%/2% TWA rate on regular-supplier purchases from the effective date forward | From the effective date onward |
| 5 | Continue withholding on rent, professional fees, contractor payments, and other separately enumerated EWT categories without interruption | Ongoing, unaffected by the delisting |
| 6 | Prepare the quarter’s QAP with two segments where the effective date falls mid-quarter: TWA-rate rows for the pre-effective-date period, ordinary-agent rows for the rest | By the standard QAP/1601-EQ deadline for that quarter |
| 7 | Keep issuing BIR Form 2307 to every payee actually withheld from in the quarter, using the ATC that applied on the date of each payment | Ongoing |
Worked example: a hardware wholesaler delisted mid-Q3 #
Solstice Hardware Distributors Inc. (fictional), a wholesale distributor previously classified as a Top Withholding Agent, is named in an updated BIR deletion list published in July 2026, with the delisting effective August 1, 2026 — squarely inside Q3 (July–September). Here’s how that single quarter’s QAP splits:
| Period | Payee type | Withholding applied | Goes into Q3 QAP? |
|---|---|---|---|
| July 1–31 | Regular supplier of goods (hardware inventory) | 1% (ATC WC158) — still a TWA all of July | Yes |
| July 1–31 | Regular supplier of services (freight/logistics) | 2% (ATC WC160) — still a TWA all of July | Yes |
| Aug 1 onward | Same hardware supplier, same purchase pattern | None under the TWA rule — delisting is effective | No TWA-rate row for August/September purchases |
| Aug 1 onward | Warehouse landlord (rent) | 5% — unaffected by TWA status | Yes |
| Aug 1 onward | Retained external bookkeeper (professional fees) | 10% — unaffected by TWA status | Yes |
| Aug 1 onward | Delivery subcontractor | 2% — unaffected by TWA status | Yes |
Solstice’s Q3 QAP, due the standard QAP/BIR Form 1601-EQ deadline, still gets filed — it just carries WC158/WC160 rows only for the July transactions, alongside the rent, professional-fee, and contractor rows that continue for the full quarter regardless of the TWA change. Nothing about the delisting empties the QAP; it reshapes it partway through the period. For the conversion mechanics once the quarter’s payee list is finalized, see How to Convert Excel to BIR DAT File for QAP.
Frequently asked questions #
Does a company still file QAP after being delisted as a Top Withholding Agent? #
In most cases, yes. QAP is not an obligation exclusive to Top Withholding Agents — it’s the quarterly payee listing for any withholding agent that deducts expanded withholding tax. A delisted company typically keeps withholding on other payment types (rent, professional fees, contractors), so it keeps filing QAP for those payees; delisting narrows what goes into the QAP rather than eliminating the filing.
When exactly does the 1%/2% TWA withholding stop after a company is delisted? #
On the first day of the month following the month the BIR publishes the updated list removing the company, per the effectivity approach set out in RR No. 7-2019 and RR No. 11-2018 and used consistently across the BIR’s periodic TWA list circulars. Purchases made before that effective date are not affected retroactively, and the company keeps withholding at 1%/2% until the effective date actually arrives.
What withholding obligations remain after a company is removed from the TWA list? #
The TWA-specific 1% (goods) / 2% (services) rule on regular suppliers stops, but the company remains an ordinary withholding agent for every other separately enumerated withholdable payment it makes — rent, professional fees, commissions, and payments to contractors and subcontractors, among others, each under its own existing ATC and rate.
Does a company need to notify the BIR itself that it was delisted? #
No. Delisting works the same way inclusion does — it takes effect only once the BIR itself publishes the taxpayer as removed from the list. A company doesn’t self-declare its way off the list just because its revenue dropped; it keeps withholding at TWA rates until the BIR’s own publication says otherwise.
What happens to BIR Form 2307 certificates already issued at the 1%/2% TWA rate before the delisting date? #
They stand as filed. Certificates correctly issued while the company was still classified as a Top Withholding Agent aren’t reopened or corrected just because the classification later changed — the delisting date only affects transactions from that date forward, not the certificates and QAP rows already reported for the period before it.
Sources #
Primary sources
- Bureau of Internal Revenue — Revenue Regulations and Memorandum issuances index (RR No. 11-2018, RR No. 7-2019, RMO No. 26-2018, and the periodic TWA-list RMCs that implement and update the Top Withholding Agent framework referenced above)
Secondary sources
- BusinessWorld Online — Are you a top withholding agent? — commentary on TWA classification, list publication, and delisting mechanics
- Grant Thornton Philippines — Are you happy to withhold? — confirms that a delisted Top Withholding Agent “no longer [is] required to perform the additional withholding obligation” from the stated effective date, while remaining an ordinary withholding agent for professional fees, contractor payments, rentals, and similar income payments
- Grant Thornton Philippines — New List of Additional and Delisted Top Withholding Agents — example of how the BIR circularizes additions and deletions together, each with its own stated effective date
Summary #
Removal from the BIR’s Top Withholding Agent list ends one specific obligation — the 1% goods / 2% services rule on regular suppliers under RR No. 11-2018 — on the first day of the month following the BIR’s own published delisting, never earlier and never by self-assessment. It does not end QAP filing for most companies, because QAP tracks all expanded withholding tax withheld in the quarter, and a delisted company almost always keeps withholding on rent, professional fees, and contractor payments as an ordinary agent. The practical task in a mid-quarter delisting is splitting that quarter’s QAP cleanly at the effective date rather than assuming the filing disappears along with the “Top” designation. Start with Who Is a BIR Top Withholding Agent? for the classification side, and see Do You Still Need to File RELIEF, SAWT, or QAP If You Have No Transactions This Period? for the rarer case where a delisted company genuinely has nothing left to withhold on.