#AskTheTaxWhiz: All about filing income tax returns

Since the original April 15 deadline for filing income tax returns (ITRs) falls on Black Saturday, the Bureau of Internal Revenue (BIR) moved the deadline to April 17.

Below are the key questions asked by taxpayers.

Who are required to file an ITR on or before April 17?

1. You are a Filipino citizen living in the Philippines, receiving income from sources within or outside the Philippines, and if: 

• You are employed by two or more employers, any time during the taxable year.
• You are self-employed, either through conduct of trade or professional practice.
• You are deriving mixed income. This means you have been an employee and a self-employed individual during the taxable year.
• You derive other non-business, non-professional related income in addition to compensation income not otherwise subject to a final tax.
• You are married, employed by a single employer, and your income has been correctly withheld – the tax due is equal to the tax withheld – but your spouse is not entitled to substituted filing.
• You are a marginal income earner.
• Your income tax during the past calendar year was not withheld correctly – if the tax due is not equal to the tax withheld.

2. You are a non-resident citizen – if you are a Filipino who works or resides abroad – receiving income from sources within the Philippines. Note, however, that you are taxable only for the income you earn from the Philippines. 

3. You are not a Filipino citizen but you receive income from sources within the Philippines, regardless of your residency. You are taxable only for the income you earn from the Philippines.

4. domestic corporations (including partnerships) receiving income from sources within and outside the Philippines

5. foreign corporations (including partnerships) receiving income from sources within the Philippines

6. estates and trusts engaged in trade or business

Who are mandated to make use of the Electronic Filing and Payment System (eFPS)?

• large taxpayers duly notified by the BIR
• top 20,000 private corporations duly notified by the BIR
• top 5,000 individual taxpayers duly notified by the BIR
• taxpayers who wish to enter into contracts with government offices
• corporations with paid-up capital stock of P10 million
• entities registered with the Philippine Economic Zone Authority (PEZA) and those located within Special Economic Zones
• government offices, insofar as remittance of withheld value-added tax (VAT) to business tax is concerned
• Based on Revenue Regulations (RR) 10-2014, those under the Taxpayer Account Management Program (TAMP). Taxpayers, whether individual or juridical entities, identified by the Revenue District Office (RDO) based on selection criteria pursuant to existing revenue issuances.

Who are mandated to use the eBIR Forms facility in electronically submitting and filing all their ITRs?

• accredited tax agents or practitioners and their client-taxpayers
• accredited printers of principal and supplementary receipts or invoices
• one-time transaction (ONETT) taxpayers
• those who shall file a “No Payment” Return
• government owned and controlled corporations (GOCCs)
• local government units (LGUs), except barangays
• cooperatives registered with the National Electrification  Administration (NEA) and Local Water Utilities Administration (LWUA)

Who may manually file “No Payment” Returns to the RDO using officially printed forms / photocopies or electronic / computer-generated returns?

• senior citizens or persons with disabilities (PWDs) filing their own returns
• employees deriving purely compensation income and the income tax of which has been withheld correctly showing tax due is equal to tax withheld, whether single or multiple employers (with two or more employers concurrently and successively at any time during the taxable year)
• employees qualified for substituted filing under RR 2-98 Section 2.83.4, as amended, but opted to file an ITR and are filing for purposes of promotion (Philippine National Police / Armed Forces of the Philippines), loans, scholarship, foreign travel requirements, etc

 Who are not required to file an ITR?

• You are a minimum wage earner.
• Your gross income (total earned for the past year) does not exceed your total personal and additional exemptions.
• Your income derived from a single employer does not exceed P60,000 and the income tax has been correctly withheld.
• Your income has been subjected to final withholding tax.
• You are qualified for substituted filing.

Who are exempted from filing an ITR?

1. You are a non-resident citizen who is: 

• a Filipino citizen not residing in the Philippines, but who has established with the BIR that you wish to remain living outside the country
• a Filipino citizen who leaves the Philippines during the taxable year to reside abroad, either as an immigrant or for permanent employment
• a Filipino citizen who works and earns income abroad
• a Filipino citizen previously considered a non-resident citizen 

2. You are an overseas Filipino worker whose income is derived solely from sources outside the Philippines.

3. If you are a Filipino citizen working as an overseas seaman, your vessel must be engaged exclusively in international trade.

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Is it your first time to file your ITR? Still confused how to accomplish the process? There’s an ITR Helpdesk ready to assist you free of charge. For reservations, email consult@acg.ph or call (02) 6227720.

– Rappler.com

Got a question about taxes? #AskTheTaxWhiz! Tweet @rapplerdotcom or email us at business@rappler.com.

Mon Abrea, popularly known as the Philippine Tax Whiz, is one of the 2016 Outstanding Persons of the World, a Move Awards 2016 Digital Mover, one of the 2015 The Outstanding Young Men of the Philippines (TOYM), an Asia CEO Young Leader of the Year, and founder of the Abrea Consulting Group and Center for Strategic Reforms of the Philippines (CSR Philippines). He currently serves as Adviser to the Commissioner of Internal Revenue of the Philippine government on tax administration reform in promoting inclusive growth. Follow Mon on Twitter (@askthetaxwhiz) or visit his Facebook page. You may also email him at consult@acg.ph.