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Sec. 2.57.2
What Shall be the Applicable
Income Withholding Tax Rates If the
Payments Individual Payee Did Not Submit Any
Subject to
Creditable
Sworn Declaration to the Payor?
Withholdin
g Tax
• The withholding agent shall withhold the higher
rate of withholding TAX WHICH IS 10%
Requirements:
Sec.
2.57.3
• Individual shall execute a sworn declaration of gross
Persons
income (with provided format-Annex B-2 of the RR);
Required • The sworn declaration shall be submitted to the lone
to payor;
Deduct • The lone payor shall likewise execute a sworn declaration
and (format also provided –Annex C of the RR) which shall be
submitted to the concerned BIR office, together with the
Withhold list of payees who shall not be subjected to withholding
tax
TRAIN Briefing – IT & WT
VER 2.0 – April 2018
38
Sec.
What if the individual did not
2.57.3 submit the sworn declaration
Persons and a copy of COR to the lone
Required payor?
to
Deduct • The lone payor is required to withhold
and the prescribed rate of withholding on
Withhold the entire payments made
TRAIN Briefing – IT & WT
VER 2.0 – April 2018
39
Sec.
What if the income payments
2.57.3 exceed P250,000 but the individual
Persons payee submitted the sworn
Required declaration?
to
Deduct • The lone payor is required to withhold the
prescribed rate of withholding only on the
and
excess over P250,000
Withhold
Sec.
2.57.5 • Sale of real property by person engaged in social housing project where
the SP does not exceed the socialized housing price applicable to the
Exemptio area as prescribed by HLURB/HUDCC
n from • Corporations duly registered with the Board of Investments (BOI),
Philippine Export Processing Zones and Subic Bay Metropolitan
Withholdi Authority enjoying exemption from income tax pursuant to E.O. 226;
ng of CWT • Corporations exempt from income tax under Section 30 of the Tax Code
as amended and GOCCs, namely: GSIS; SSS; PHIC and LWDs;
Withhold • GPPs;
• Joint Ventures or consortium formed for the purpose of undertaking
construction project…
• Individuals who earn P250,000 and below from a lone payor subject to
compliance with some requirements
TRAIN Briefing – IT & WT
VER 2.0 – April 2018
41
Section 2.58 Returns and Payment of Taxes
Withheld at Source
Withheld at Source
Final
• 0619-F BIR Form 1601-FQ
BIR Form 1602
Withholding • (first 2
BIR Form 1603
Tax • months)
Due date is within thirty (30) days from the date of Due date is on or
transactions before the tenth (10TH)
BIR Form to be used: day following the
BIR Form 1706 – Sale of Real Property month of transaction
Considered Capital Asset BIR Form to be used:
BIR Form 1707 – Sale of Shares of Stocks Not
BIR FORM NO.
Traded in Local Stock Exchange
1606
TRAIN Briefing – IT & WT
VER 2.0 – April 2018
45
Section 2.58 Returns and Payment of Taxes
Withheld at Source
Certificate/Statement of Tax Withheld at Source
* Taxpayer’s income of SMW, overtime pay, and night shift differential pay are expressly
exempt from income tax under the law and consequently from withholding tax.
* Commission income from the same employer is taxable, however, under the graduated
income tax rates since it is less than ₱250,000, there is no tax due.
Illustration : Computation
Fringe Benefits • Increase to 35% for citizen, resident alien and alien
Rate engaged in trade or business in the Philippines
Illustration : Computation
Total taxable compensation ₱ 165,000.00
Less: Compensation Range (Minimum) 66,667.00
Excess ₱ 98,333.00
Add: Supplemental Compensation 5,000.00
Total ₱ 103,333.00
• Name/Taxpayer’s identification
Require Number/residential address
Attachment body
• Copy of marriage contract, if married
s
TRAIN Briefing – IT & WT
VER 2.0 – April 2018
Section 2.79.1 Application for Registration for
59
EMPLOYEE
EMPLOYER FILL-OUT BIR RECEIVES THE
ACCOMPLISHES BIR
PART IV OF THE BIR DULY
FORM 1902 AND
FORM 1902 AND ACCOMPLISHED BIR
SUBMITS TO
SUBMITS TO BIR FORM 1902
EMPLOYER
EMPLOYEE EMPLOYER
BIR RECEIVES THE
ACCOMPLISHES BIR RECEIVES THE
DULY
FORM 1905 AND ACCOMPLISHED BIR
ACCOMPLISHED BIR
SUBMITS TO FORM 1905 AND
FORM 1905
EMPLOYER SUBMITS TO BIR
CERTIFIED
LIST OF
EMPLOYEES
DUPLICATE QUALIFIED NOT LATER
COPIES OF FOR THAN
BIR FORM SUBSTITUTED FEBRUARY
28
BIR
2316 FILING OF
ANNUAL
INCOME TAX
RETURN (AITR)
Gross IT Taxable at 0% Not subject Exempt, if earnings from purely No, for purely
P250,000 business/practice of profession; business;
and below 8% if mixed income earner, based on
gross sales/receipts & other non- Yes, if mixed
operating income income earner
BT PT/VAT Subject, if Not subject to PT Not subject
govt payor
Doc Payee’s Sworn Declaration Payee’s Sworn Declaration
Above IT Taxable at Subject at 8% on gross sales/receipts and other Subject to
250,000 to applicable grad applicable non-operating income; however, for applicable rate
3M rates on net rates purely business/practice – entitled to
income reduction of P250,000
BT PT/VAT Subject, if Not subject to PT Not subject
govt payor
Doc Payee’s Sworn Declaration Payee’s Sworn Declaration
Above IT Subject to subject Not entitled to avail
P3M applicable rate
BT VAT Subject WT of
TRAIN Briefing – IT & WT VAT, if govt
VER 2.0 – April 2018 payor
73
Sworn Declarations
1. Annex A: Affidavit-Declaration that No Professional Fee Has Been
Charged by Medical Practitioner
2. Annex B-1: Income Payee’s Sworn Declaration of Gross Receipts/Sales
(For Self-Employed and/or Engaged in the Practice of Profession with
Several Income Payors)
3. Annex B-2: Income Payee’s Sworn Declaration of Gross Receipts/Sales
(For Self-Employed and/or Engaged in the Practice of Profession with
Lone Income Payor)
4. Annex B-3: Income Payee’s Sworn Declaration of Gross Receipts/Sales
(For Non-Individual Taxpayer with Several Income Payors)
5. Annex C: Income Payor/Withholding Agent’s Sworn Declaration
6. Annex F: Certification