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Welcome to Topic 230

WITHHOLDING
TAXES

CS & TMD
General Course for Revenue Officers WT 230 Slide 1
Distribution of Tax Returns Filed by Type of
Tax for the CY 2007

Other Transfer
Taxes Taxes

13.08% 0.37%
Withholding
Percentage Taxes
Taxes
40.81%
24.62%

Excise Taxes
Value-Added Taxes Income Taxes
0.17%
13.42% 7.53%

CS & TMD
General Course for Revenue Officers WT 230 Slide 2
Objectives

 Realize the importance of withholding tax system;


 Differentiate the various types of withholding
taxes;
 Compute the withholding tax on compensation,
expanded, final and government money payments;

 Determine the duties and obligations of a


withholding agent; and
 Identify the different withholding tax returns required
to be accomplished and filed by the withholding agents
and the certificates to be issued to income recipients.

CS & TMD
General Course for Revenue Officers WT 230 Slide 3
Topic Outline

 Importance of the Withholding Tax System;


 Withholding Tax on Compensation;
 Expanded Withholding Taxes;
 Final Withholding Taxes;
 Withholding Tax on Government Money
Payments;
 Time of Withholding;
 Time of Filing and Payment;
 Duties and Obligations of a Withholding Agent;
 Withholding Tax Returns;
 Government Expense Codes; and
 Revised Withholding Tax Tables.

CS & TMD
General Course for Revenue Officers WT 230 Slide 4
Importance of Withholding Tax System

It is considered as an effective tool in the collection of


taxes for the following reasons:

It encourages voluntary compliance;


It reduces cost of collection effort;
It prevents delinquencies and revenue loss; and
It prevents dry spells in the fiscal condition of
the government by providing revenues
throughout the taxable year.

CS & TMD
General Course for Revenue Officers WT 230 Slide 5
Types of Withholding Taxes

1. Withholding Tax on Compensation

2. Expanded Withholding Tax

3. Final Withholding Tax; and

4. Withholding Tax on Government


Money Payment

CS & TMD
General Course for Revenue Officers WT 230 Slide 6
Withholding Tax on Compensation

Compensation or Wages - means all


remuneration for services performed by an
employee for his employer under an
employee-employer relationship unless
exempted by the NIRC and pertinent laws.

CS & TMD
General Course for Revenue Officers WT 230 Slide 7
Kinds of Compensation

 Regular Compensation

- includes basic salary, fixed allowances


for representation, transportation and
others paid to an employee.

CS & TMD
General Course for Revenue Officers WT 230 Slide 8
Kinds of Compensation (cont.)
 Supplementary Compensation -includes payments to an
employee in addition to the regular compensation as follows:
 Commissions
 Overtime pay
 Fees, including directors fees
 Profit sharing
 Monetization of leave credits
 Sick Leave
 Fringe benefit received by rank & file employee
 Hazard pay
 Taxable 13th month pay
 Other remuneration received from an employee-
employer relationship

CS & TMD
General Course for Revenue Officers WT 230 Slide 9
Exemptions from Withholding
Tax on Compensation
1. Remuneration received as an incident of employment
(RA 7641; those with approved reasonable private retirement
plan; Social Security Act 1954, as amended; GSIS Act of 1937,
as amended; and etc.)
2. Remuneration paid for agricultural labor
3. Remuneration for domestic services
4. Remuneration for casual labor not in the course of an
employer's trade or business
5. Compensation for services by a citizen or resident of the Philippines
for a foreign government or International Organization
6. Damages (Actual, moral, exemplary and nominal)
7. Life insurance
8. Amounts received by the insured as a return of premium
9. Compensation for injuries or sickness
10. Income exempt under treaty
11. Thirteenth (13th) month pay & other benefits
12. GSIS,SSS Medicare & other contributions (employees share only)

CS & TMD
General Course for Revenue Officers WT 230 Slide 10
Exemptions from Withholding
Tax on Compensation

13. Compensation income of minimum wage earners (MWEs) who work


in the private sector and being paid the Statutory Minimum Wage
(SMW), as fixed by the Regional Tripartite Wage and Productivity
Board (RTWPB) / National Wages Productivity Commission (NWPC),
applicable to the place where he/she is assigned.

14. Compensation income of employees in the public sector with


compensation income of not more than Statutory Minimum Wage in
the non-agricultural sector, as fixed by the RTWPB / NWPC,
applicable to the place where he/she is assigned.

CS & TMD
General Course for Revenue Officers WT 230 Slide 11
De Minimis Benefits Not
Subject to Withholding Tax
a) Monetized unused vacation leave credits of employees not
exceeding ten (10) days during the year and the monetized
value of leave credits paid to government officials and employees;
b) Medical cash allowance to dependents of employees not
exceeding Seven Hundred Fifty Pesos (P750.00) per employee
per semester or One Hundred Twenty-Five Pesos (P125.00) per
month;
c) Rice subsidy of One Thousand Five Hundred Pesos (P1,500.00)
or one (1) sack 50 kg. rice per month amounting to not more than
One Thousand Five Hundred Pesos (P1,500.00);
d) Uniform and clothing allowance not exceeding Four Thousand
Pesos (P4,000.00) per annum;

CS & TMD
General Course for Revenue Officers WT 230 Slide 12
De Minimis Benefits Not
Subject to Withholding Tax
e) Actual yearly medical benefits not exceeding Ten Thousand Pesos
(P10,000.00) per annum;
f) Laundry allowance not exceeding Three Hundred Pesos
(P300.00) per month;

g) Employee achievement award (e.g. for length of service or safety


achievement) which must be in the form of a tangible personal property other
than cash or gift certificate with an annual monetary value not exceeding Ten
Thousand Pesos (P10,000.00) received by the employee under an established
written plan which does not discriminate in favor of highly paid employees;

CS & TMD
General Course for Revenue Officers WT 230 Slide 13
De Minimis Benefits Not
Subject to Withholding Tax (cont.)

h) Gifts given during Christmas and major anniversary celebrations


not exceeding Five Thousand Pesos (P5,000.00) per annum;
i) Flower, fruits, books, or similar items given to employees under
special circumstances such as illness, marriage and birth of a
baby; and
j) Daily meal allowance for overtime work not exceeding twenty-five
percent (25%) of the basic minimum wage.

CS & TMD
General Course for Revenue Officers WT 230 Slide 14
Requirements of Withholding

Every employer must withhold from compensation paid an


amount computed in accordance with these Regulations.
Provided, that no withholding of tax shall be required on the
Statutory Minimum Wage (SMW) including:
holiday pay
overtime pay
night shift differential
hazard pay
of Minimum Wage Earners (MWE) in the private/public sectors as
defined in these Regulations.

CS & TMD
General Course for Revenue Officers WT 230 Slide 15
Requirements of Withholding

Provided, further, that an employee who receives additional


compensation such as:
commissions
honoraria
fringe benefits
benefits in excess of the allowable statutory amount of P30,000.00
taxable allowances and other taxable income other than the SMW
holiday pay
overtime pay
hazard pay
night shift differential pay
shall not enjoy the privilege of being a MWE and, therefore, his/her entire
earnings are not exempt from income tax and, consequently, shall be
subject to withholding tax.

CS & TMD
General Course for Revenue Officers WT 230 Slide 16
Personal and Additional Exemption

Basic personal P50,000


exemption
Additional exemption P25,000 per child
for each qualified
dependent child
(maximum of 4)

Note: Husband is the proper claimant of the additional


exemption unless he explicitly waives his right in favor of the
wife in BIR Form Nos. 1902 or 2305

CS & TMD
General Course for Revenue Officers WT 230 Slide 17
SWORN DECLARATION AND WAIVER OF RIGHT
TO CLAIM EXEMPTIONS OF QUALIFIED DEPENDENT CHILDREN

CS & TMD
General Course for Revenue Officers WT 230 Slide 18
Premium Payments on Health and
Hospitalization Insurance of an Individual Taxpayer
Two Thousand Four Hundred Pesos (P2,400.00) per family or
Two Hundred Pesos (P200.00) a month paid during the
taxable year

Conditions:
1. Familys gross income must not be more than
Two Hundred Fifty Thousand Pesos (P250,000.00)
for the taxable year;

2. In case of married employees, only the spouse


claiming additional exemption for the dependent
children shall be entitled; and

3. Substantiation such as policy contracts and


official receipts paid, must be shown/submitted.

CS & TMD
General Course for Revenue Officers WT 230 Slide 19
Steps to Determine the amount of tax
to be Withheld

Step 1. Determine monetary and non-monetary compensation


paid to an employee for the payroll period segregating;
gross benefits (e.g. 13th month pay, productivity incentives,
Christmas bonus and other benefits)
employees contribution (e.g. SSS, GSIS, HDMF, PHIC, and
Union Dues
Step 2. Segregate the taxable from the non-taxable
compensation paid to the employee for the payroll
period

CS & TMD
General Course for Revenue Officers WT 230 Slide 20
Steps to Determine the amount of tax
to be Withheld
Step 3. Segregate the taxable compensation income as
determined in Step 2 into:
Regular taxable income
Supplementary compensation income

Step 4. Use the appropriate Withholding Tax Tables for the


payroll period
Monthly
Semi-monthly
Weekly
Daily

CS & TMD
General Course for Revenue Officers WT 230 Slide 21
Steps to Determine the amount of tax
to be Withheld
Step 5. Fix the compensation level as follows:

MONTHLY 1 2 3 4 5 6 7 8
Exemption 0.00 0.00 41.67 208.33 708.33 1,875.00 4,166.67 10,416.67
Status +0% +5% +10% +15% +20% +25% +35% +32%
over over over over over over over over
A. Table for employees without qualified dependent
1. Z 0.0 1 0 833 2,500 5,833 11,667 20,833 41,667
2. S/ME 50.0 1 4,167 5,000 6,667 10,000 15,833 25,000 45,833
B. Table for single/married employee with qualified dependent child(ren)
1. ME1 / S1 75.0 1 6,250 7,083 8,750 12,083 17,917 27,083 47,917
2. ME2 / S2 100.0 1 8,333 9,167 10,833 14,167 20,000 29,167 50,000
3. ME3 / S3 125.0 1 10,417 11,250 12,917 16,250 22,083 31,250 52,083
4. ME4 / S4 150.0 1 12,500 13,333 15,000 18,333 24,167 33,333 54,167

CS & TMD
General Course for Revenue Officers WT 230 Slide 22
Steps to Determine the amount of tax
to be Withheld

Step 6. Compute the withholding tax due by adding the tax


predetermined in the compensation level indicated at
the top of the column, to the tax on the excess of the
total regular and supplementary compensation over
the compensation level, which is computed by
multiplying the excess by the rate also indicated at the
top of the same column/compensation level.

CS & TMD
General Course for Revenue Officers WT 230 Slide 23
Sample Problem 1
Mr. A, single with no dependent, receives P12,000.00 (net of SSS/GSIS,
PHIC, HDMF employee share only) as monthly regular compensation and
P5,000.00 as supplementary compensation for January 2009 or a total of
P17,000.00.
COMPUTATION: Using the monthly withholding tax table (Revised Withholding Tax Tables beginning
January 1, 2009), the withholding tax for January 2009 is computed by referring to Table A line 2 S of column
5 (fix compensation level taking into account only the regular compensation income of P12,000.00 which
shows a tax of P708.33 on P10,000.00 plus 20% of the excess of P2,000.00 (P12,000.00 less P10,000.00)
plus P5,000.00 supplementary compensation.
Regular compensation P12,000.00
Less: compensation level
(line A-2 Column 5) 10,000.00
Excess P 2,000.00
Add: Supplementary compensation 5,000.00
Total P 7,000.00

Tax on P10,000.00 P 708.33


Tax on excess (P7,000 x 20%) 1,400.00
Withholding tax for January 2009 P 2,108.33
========
CS & TMD
General Course for Revenue Officers WT 230 Slide 24
Sample Problem 1

MONTHLY 1 2 3 4 5 6 7 8
Exemption 0.00 0.00 41.67 208.33 708.33 1,875.00 4,166.67 10,416.67
Status +0% +5% +10% +15% +20% +25% +35% +32%
over over over over over over over over
A. Table for employees without qualified dependent
1. Z 0.0 1 0 833 2,500 5,833 11,667 20,833 41,667
2. S/ME 50.0 1 4,167 5,000 6,667 10,000 15,833 25,000 45,833
B. Table for single/married employee with qualified dependent child(ren)
1. ME1 / S1 75.0 1 6,250 7,083 8,750 12,083 17,917 27,083 47,917
2. ME2 / S2 100.0 1 8,333 9,167 10,833 14,167 20,000 29,167 50,000
3. ME3 / S3 125.0 1 10,417 11,250 12,917 16,250 22,083 31,250 52,083
4. ME4 / S4 150.0 1 12,500 13,333 15,000 18,333 24,167 33,333 54,167

CS & TMD
General Course for Revenue Officers WT 230 Slide 25
Sample Problem 2
For the month of August 2008, Mrs. C, married with three qualified dependent children,
with a basic salary equivalent to the SMW, receives P9,964.00 (P382/day x 313 days
12) as statutory monthly minimum wage plus other compensation such as commission
of P10,000, transportation allowance of P2,000, hazard pay of P1,000, overtime pay of
P5,000 and night shift differential pay of P2,000.00. Compute the withholding tax of Mrs.
C for the month of August 2008 using the Revised Transitional Withholding Tax Table for
the period July 6 to December 31 2008.

COMPUTATION:
Statutory Minimum Wage P 9,964.00
Gross Benefits
Hazard pay 1,000.00
Overtime Pay 5,000.00
Night Shift Differential 2,000.00 8,000.00
Sub-total P17,964.00
Taxable compensation
Commission* 10,000.00
Transportation allowance* 2,000.00 12,000.00
Total Taxable Compensation Income P29,964.00
========

CS & TMD
General Course for Revenue Officers WT 230 Slide 26
Sample Problem 2
Regular compensation P 9,964.00
Less: Compensation level (line B-3 column 4) 7,708.00
Excess P 2,256.00
Add: Supplementary compensation (8,000 + 12,000) 20,000.00
Total P 22,256.00

Tax on P9,964.00 (Line B3, col. 4) P 208.33


Tax on excess (P22,256.00 x 15%) 3,338.40
Withholding tax for the month of August 2008 P 3,546.73
=========
MO N TH L Y 1 2 3 4 5 6 7 8
Exemption 0.00 0.00 41.67 208.33 708.33 1,875.00 4,166.67 10,416.67
Status (`000P) +0% over +5% over +10% over +15% over +20% over +25% over +30% over +32% over
A. Table for employees without qualified dependent
1. Z 0.0 1 0 833 2,500 5,833 11,667 20,833 41,667
2. S/ME 25.0 1 2,083 2,917 4,583 7,917 13,750 22,917 43,750
B. Table for employee with qualified dependent child(ren)
1. ME1 / S1 37.5 1 3,125 3,958 5,625 8,958 14,792 23,958 44,792
2. ME2 / S2 50.0 1 4,167 5,000 6,667 10,000 15,833 25,000 45,833
3. ME3 / S3 62.5 1 5,208 6,042 7,708 11,042 16,875 26,042 46,875
4. ME4 / S4 75.0 1 6,250 7,083 8,750 12,083 17,917 27,083 47,917

Note: *An employee who receives compensation other than the SMW, holiday, overtime, night
shift differential and hazard pay shall not enjoy the privilege of being a minimum wage earner, and
his entire earnings are no longer considered exempt.

CS & TMD
General Course for Revenue Officers WT 230 Slide 27
Use of Exceptional Computation

a. Cumulative Average Method


b. Annualized Withholding Tax Method

CS & TMD
General Course for Revenue Officers WT 230 Slide 28
Year-end Adjustment

On or before the calendar year and


prior to the payment of the compensation
for last payroll period, the employer shall
determine the sum of the taxable regular and
supplementary compensation paid to each
employee for the whole year and must ensure
that the tax due is equal to tax withheld.

CS & TMD
General Course for Revenue Officers WT 230 Slide 29
Annualized Withholding Tax
(Year-End Adjustment)
PURPOSE:
Tax due = Tax Withheld

WHEN:
1. When the employer employee relationship is
terminated before the end of the calendar year.
2. When computing for the year-end adjustment, the
employer shall determine the amount to be
withheld from the compensation of the last month
of employment or in December of the current
calendar year.

CS & TMD
General Course for Revenue Officers WT 230 Slide 30
Annualized Withholding Tax

Step 1 Determine the taxable regular and


supplementary compensation paid to the
employee for the entire calendar year;

Step 2 If the employee has previous employment/s


within the year, add the amount of taxable
regular and supplementary compensation
paid to the employee by the present
employer;

CS & TMD
General Course for Revenue Officers WT 230 Slide 31
Annualized Withholding Tax (cont.)

Step 3 Deduct from the aggregate amount of


compensation computed in Step 2 the
amount of the total personal and additional
exemptions of the employee;
Basic personal exemption P50,000

Additional exemption for each P25,000 per child


qualified dependent child
(maximum of 4)

Note: Husband is the proper claimant of the additional exemption


unless he explicitly waives his right in favor of the wife in BIR Form
Nos. 1902 or 2305

CS & TMD
General Course for Revenue Officers WT 230 Slide 32
Annualized Withholding Tax (cont.)

Step 4 Deduct the amount of premium payments on


Health and/or Hospitalization Insurance of
employees who have presented evidence,
that they have paid the same during the
taxable year.
Note 1: The deductible amount shall not exceed P2,400.00 per annum or
P200.00 per month whichever is lower and total family gross income does
not exceed P250,000.00 for the calendar year.

Note 2: For purposes of substantiating the claim of insurance expense and


determining the aggregate family income, the policy contract shall be presented to the
employer together with the original official receipt of the premium payment for the
current year, BIR Form No. 2316 for the current year or Certificate of Gross Income for
the Current Year (Annex E) issued by the employer/s of the nuclear family.

CS & TMD
General Course for Revenue Officers WT 230 Slide 33
Certificate of Gross Income for the
Current Year

CS & TMD
General Course for Revenue Officers WT 230 Slide 34
Annualized Withholding Tax (cont.)
Step 5 Compute the amount of tax on the difference arrived
at in Step 4.
But Not Of Excess
Over Amount Rate Over
Over
not over 10,000 5%
10,000 30,000 500+10% 10,000
30,000 70,000 2,500+15% 30,000
70,000 140,000 8,500+20% 70,000
140,000 250,000 22,500+25% 140,000
250,000 500,000 50,000+30% 250,000
500,000 over 125,000+32% 500,000

CS & TMD
General Course for Revenue Officers WT 230 Slide 35
Annualized Withholding Tax (cont.)

Step 6 Determine the deficiency or excess, if any, of


the tax computed in Step 5 over the
cumulative tax already deducted and withheld
since the beginning of the current calendar
year.

CS & TMD
General Course for Revenue Officers WT 230 Slide 36
Annualized Withholding Tax - Formula

Gross Compensation Income (present + previous employer) P xxx


Less: Non-taxable/Exempt Compensation Income
a.) 13th month pay and other benefits xx
b.) Other non-taxable benefits xx
c.) SSS, GSIS, PHIC, HDMF and
Union Dues (employees share only) xx xxx
Less: a.) Personal and additional exemption xx
b.) Health /Hospitalization premium payment
(if applicable) xx xxx
Taxable Compensation Income xxxx
Tax Due xxx
Tax Withheld (Jan. Nov./termination date) xxx
Collectible: Tax due > tax withheld collect before payment of last salary
Refund: Tax due < tax withheld refund on or before Jan. 25th of the year /
last payment of salary
Break even: Tax due = tax withheld no more withholding for December salary

CS & TMD
General Course for Revenue Officers WT 230 Slide 37
EXAMPLE 1: (Year-end adjustments computation)

For taxable year 2009, WTD Corporation (Full exemption per RA 9504
shall be used for calendar year 2009) has the following employees

Mr. F, married, whose wife is also employed, with two qualified dependent
children, received for the year:

Basic Monthly Salary P 16,500.00


Thirteenth Month Pay P 16,500.00
Other Benefits P 16,500.00
Withholding tax (Jan Nov) P 12,924.23

CS & TMD
General Course for Revenue Officers WT 230 Slide 38
EXAMPLE 1: (Year-end adjustments computation)

Compensation Received Non-Taxable Taxable


For the Year
Basic Salary P198,000 P198,000
13th month pay 16,500 P16,500
Other benefits 16,500 13,500 3,000*
Totals P231,000 P30,000* P201,000
=======
* Excess of 13th month pay and other benefits over the P30,000.00 ceiling under Sec. 32(b)(7)(e).

Total Compensation P 201,000.00


Less: Personal and additional exemptions (ME2) 100,000.00
Net taxable compensation income P 101,000.00

Tax Due P14,700.00


Less: Tax withheld from previous months (Jan-Nov) 12,924.23
Amount to be withheld in December 2009 P 1,775.77
=========

CS & TMD
General Course for Revenue Officers WT 230 Slide 39
EXAMPLE 2: (Year-end adjustments computation)

Mr. G, single, who was hired on July 6, 2009 received the following:

Basic Monthly Salary P 20,000.00


Thirteenth Month Pay P 20,000.00
Monthly Salary from Previous
Employer (Jan-June) P 6,000.00
Withholding tax Previous employer P 2,899.68
Present employer 17,500.50

He paid for the year an annual premium on health and hospitalization insurance
amounting to P2,400.00.

CS & TMD
General Course for Revenue Officers WT 230 Slide 40
EXAMPLE 2: (Year-end adjustments computation)

Mr. G, Single Computation of withholding tax for December


Compensation from previous employer (Jan. to June) P 36,000.00
Compensation from present employer (July 6 to Dec) 120,000.00
Total taxable compensation (Jan. to Dec.) 156,000.00
Less: Personal exemptions 50,000.00
Premium payments on health &
hospitalization insurance *2,400.00 52,400.00
Net taxable compensation P103,600.00

Tax Due P 15,220.00


Less: Taxes Withheld
** Previous employer P 2,899.68
***Present employer 17,500.50 20,400.18
Amount to be refunded in December (P 5,180.18)
=========

* Premium payment on health and/or hospitalization shall be allowed considering that gross compensation amounted
to P156,000 only and did not exceed P250,000.00.
** Refer to Certificate of Compensation Payment /Tax Withheld (BIR Form No. 2316) issued by previous employer.
*** Taxes withheld from July 6 to December 31, 2008 computed by the present employer using the cumulative
computation.

CS & TMD
General Course for Revenue Officers WT 230 Slide 41
Requirement for Deductibility

The provisions of Sec 2.58.5 of RR 2-98, as amended,


shall apply. Provided, that compensation income where no
income taxes were withheld pursuant to Section 2.79(A) of these
regulations, shall be allowed as deduction from an employers
gross income when the required employees withholding statement
(BIR Form No. 2316) have been issued to subject employees in
accordance with Sec. 2.83.1 of RR 2-98, as amended. Provided,
further, that the Alphabetical List of the subject employees,
including MWEs, shall be submitted under BIR Form No. 1604-CF
with Alphalists of Employees in accordance with Sec. 2.83.2 of
RR 2-98, as amended.

CS & TMD
General Course for Revenue Officers WT 230 Slide 42
Right to Claim Withholding Exemptions

An employee receiving compensation shall be entitled


to withholding exemptions as provided in the Code, as
amended. In order to receive the benefit of such exemptions,
the employee must file the Application for Registration (BIR
Form No. 1902), upon employment, or a Certificate of Update
of Exemption and of Employers and Employees Information
(BIR Form No. 2305), in case of updates on changes in his
exemption. The withholding exemption to which an employee is
entitled depends upon his status and the number of dependents
qualified for additional exemptions.

CS & TMD
General Course for Revenue Officers WT 230 Slide 43
Application for Registration for Individuals Earning
Compensation Income (BIR Form No. 1902)

1. Name/Taxpayers Identification Number (TIN)/ Address of employee/other


information required as stated in BIR Form No. 1902;
2. Status of employee whether SINGLE/ legally separated/ widow or widower with no
dependent child or married;
3. Status of spouse of the employee. If the employee is legally married, the Name/
TIN, if any, of the spouse and whether said spouse is employed, unemployed,
employed abroad, or is engaged in trade or business should be indicated on the
application;
4. Qualified dependents Name and date of birth of qualified dependent/s child(ren);
5. Claimant of exemption for children. The husband is the proper claimant of
additional exemptions for qualified dependent children. However, the wife shall
claim full additional exemption for children in the following cases:
(a) Husband is unemployed;
(b) Husband is a non-resident citizen deriving income from foreign sources;
(c) The husband waives his right to claim the exemptions of children (waiver
should be for all children) in a sworn statement to be attached to his
Application for Registration (BIR Form No. 1902) and that of his wifes, in
accordance with the procedures prescribed in this Section;

CS & TMD
General Course for Revenue Officers WT 230 Slide 44
Required forms and attachments
(BIR Form Nos. 1902 and 2305)

a. Marriage Contract;
b. Birth Certificate of each qualified dependent child(ren), certified by the
Local Civil Registry Office/National Statistics Office (NSO)/equivalent
document issued by a government office previously requiring certified copy
showing the name of parent/s and the name of the QDC with birth date
(e.g. passport of QDC as certified by companys Human Resource Officer);
c. Certificate of employment of the husband if he is working abroad;
d. Sworn Declaration and Waiver of Right to Claim Exemptions of Qualified
Dependent Child(ren) by the Husband (Annex F) in case wife is claiming
the additional exemptions of the children;
e. Medical Certificate of qualified dependent child, if physically/mentally
incapacitated;
f. Court decision of legal adoption of children;
g. Death Certificate; and
h. Other documentary evidence, where the above documents are not
available.

CS & TMD
General Course for Revenue Officers WT 230 Slide 45
What are TPs Expectation after
Submission of Annual Return

1. TPs file copy of manually submitted


BIR Form 1604CF / 1604E

2. Transmittal Form issued by the RDO


on the receipt of diskette submitted

CS & TMD
General Course for Revenue Officers WT 230 Slide 46
Transmittal Form
REPUBLIC OF THE PHILIPPINES ANNEX C
DEPARTMENT OF FINANCE
BUREAU OF INTERNAL REVENUE
TRANSMITTAL FORM
BIRs Copy

Type of Returns : 1604-CF 1604-E For the Year: ___________


Transmittal Number : _____________________ TIN: _____ - _____ - _____
Name of Withholding Agent :_____________________________________________
Address : ____________________________________________________________________
Name of Contact Person/WAs Representative:_____________________ Tel. No.:__________
No. of Diskettes Submitted: ________
Received by: _______________ Office: ____________________

------ For returned diskette (to be resubmitted within 1 week) -------


Stamp
Labelling Virus found of
Receiving Office
Date returned: _____________ Date resubmitted: _____________
-----------------------------------------------------------------------------------------
Date: __________
Uploaded Date of uploading: _________________

Not uploaded Reason: _________________________

CS & TMD
General Course for Revenue Officers WT 230 Slide 47
Substituted Filing

 An individual taxpayer will no longer have to


personally file his own Income Tax Return (BIR Form
No. 1700) but instead the employers Annual
Information Return on Income Taxes Withheld (BIR
Form No. 1604CF) filed will be considered as the
substitute ITR of the employee.

 Effectivity - Year 2001 voluntary basis


- Year 2002 and thereafter mandatory

CS & TMD
General Course for Revenue Officers WT 230 Slide 48
Requisites for Individuals Qualified for Substituted Filing
and May No Longer/No Need to File BIR Form No. 1700

1. Receives purely compensation income regardless of


amount;
2. Compensation from only one employer in the Philippines
for the calendar year;
3. Income tax has been withheld correctly by the employer
(tax due equals tax withheld);
4. The employees spouse also complies with all the three
conditions stated above;
5. Employer files the BIR Form 1604-CF; and
6. The employer issues each employee BIR Form No. 2316
(October 2002 ENCS or any later version).

CS & TMD
General Course for Revenue Officers WT 230 Slide 49
Requisites for Individuals Qualified for Substituted Filing
and May No Longer/No Need to File BIR Form No. 1700

Note: All of the above requisites must be present. The Annual


Information Return of Income Taxes Withheld on Compensation
and Final Withholding Taxes (BIR Form No. 1604-CF) filed
by their respective employers duly stamped Received, shall be
tantamount to the substituted filing of income tax returns by said
employees.

CS & TMD
General Course for Revenue Officers WT 230 Slide 50
Individuals NOT Qualified for Substituted
Filing and Must File BIR Form No. 1700

1. Individuals with two or more employers


concurrently and successively at anytime during
the taxable year.

2. Employees whose income tax have not been


withheld correctly resulting to collectible or
refundable return.

3. Employees whose monthly gross income do not


exceed Five Thousand Pesos (P5,000.00) or the
statutory minimum wage, whichever is higher, and
opted for non-withholding of tax on said income.

CS & TMD
General Course for Revenue Officers WT 230 Slide 51
Individuals NOT Qualified for Substituted
Filing and Must File BIR Form No. 1700 (cont.)

4. Individuals deriving other non-business, non-profession-


related income in addition to compensation income not
otherwise subject to final tax.

5. Individuals receiving purely compensation income from a


single employer whose income tax has been correctly
withheld but whose spouse does not qualify for
substituted filing.

CS & TMD
General Course for Revenue Officers WT 230 Slide 52
Individuals NOT Qualified for Substituted
Filing and Must File BIR Form No. 1700 (cont.)

6. Non-resident aliens engaged in trade or business in the


Philippines deriving purely compensation income or
compensation income and other non-business, non-
profession-related income.

Note: In case of married individuals who are still required to file


returns, only ONE RETURN FOR THE TAXABLE YEAR SHALL
BE FILED by either of the spouses to cover income of both. It
shall be SIGNED BY HUSBAND AND WIFE unless physically
impossible to do so, in which case, signature of one of the
spouses would suffice.

CS & TMD
General Course for Revenue Officers WT 230 Slide 53
Certificate of Compensation Payment/
Tax Withheld
What to issue: BIR Form No. 2316
(BIR Form 2316 Oct 2002 ENCS version)
Who to issue: Employer
When to issue: a) On or before January 31 of the
succeeding calendar year; or
b) On the day of last payment of
compensation, if terminated
Number of copies: Three (3) copies
Signed by: Both employer and employee
(under the penalty of perjury)
Note: An extra copy shall be furnished by the employer duly certified by him to
his NEW employer in case of transfer of employment within the taxable year.

CS & TMD
General Course for Revenue Officers WT 230 Slide 54
Certificate of Final Income Tax
Withheld at Source
What to issue: BIR Form No. 2306
Who to issue: Payor
When to issue: On or before January 31 of the
following calendar year; or

Number of copies: Three (3) copies

CS & TMD
General Course for Revenue Officers WT 230 Slide 55
For Substituted Filing
Certificate of Compensation Payment/Tax Withheld -
(BIR Form No. 2316)
 This certificate shall include a certification that
the employers filing of BIR Form No. 1604-CF
shall be considered a substituted filing of the
employees income tax return.
 It shall be signed by both the employees and
employer attesting the information stated
therein has been verified and is true and correct
to the best of their knowledge.

NOTE: However, the withholding agents/employers are


required to retain copies of the duly signed BIR
Form No. 2316 for a period of three (3) years as
required under the NIRC.

CS & TMD
General Course for Revenue Officers WT 230 Slide 56
For Individuals Not Qualified for Substituted Filing
Certificate of Compensation Payment/Tax Withheld -
(BIR Form No. 2316)

 Information referring to the certification,


appearing at the bottom of BIR Form No.
2316, shall not be signed by both the
employer and the employee if the latter is not
qualified for substituted filing.

 BIR Form No. 2316 furnished by the employer


to the employee shall be attached to the
employees Income Tax Return (BIR Form No.
1700) to be filed on or before April 15 of the
following year.

CS & TMD
General Course for Revenue Officers WT 230 Slide 57
Uses of Certificate of Compensation Payment/
Tax Withheld (BIR Form No. 2316)

 Proof of financial capacity for purposes of loan,


credit card, or other applications;

 Proof of payment of tax or for availing tax credit


in the employees home country;

 Securing travel tax exemption, when necessary;


and

 Other purposes with various government


agencies.

CS & TMD
General Course for Revenue Officers WT 230 Slide 58
What to Do with BIR Form No. 2316
Issued by Employer

1.) If the BIR Form No. 2316 was issued by a previous


employer as a result of termination of employment
and the employee has been subsequently
employed within the same calendar year, the
employee should submit a copy of BIR Form No.
2316 issued by the previous employer to his
present employer, for consolidation with his current
compensation received from the present employer.

CS & TMD
General Course for Revenue Officers WT 230 Slide 59
What to Do with BIR Form No. 2316
Issued by Employer (cont.)

2.) If the employee is qualified for substituted filing, a


copy of BIR Form No. 2316 signed both by the
employer and employee shall be retained and kept
by the employer and the employee.

3.) If an employee is not qualified for substituted filing,


he is required by law to file his Income Tax Return
(BIR Form No. 1700 or BIR Form No. 1701) and
BIR Form No. 2316 should be attached as proof of
his compensation income and withholding taxes.

CS & TMD
General Course for Revenue Officers WT 230 Slide 60
Expanded Withholding Taxes (EWT)

The Withholding of Creditable Tax at Source


or simply called Expanded Withholding Tax is a tax
imposed and prescribed on the items of income
payable to natural or juridical persons, residing in the
Philippines, by a payor-corporation/person which shall
be credited against the income tax liability of the
taxpayer for the taxable year.

CS & TMD
General Course for Revenue Officers WT 230 Slide 61
Income Tax / Creditable VAT / Percentage

Creditable Income Tax Creditable VAT/


Percentage Tax
What to issue: BIR Form No. 2307 BIR Form No. 2307
Who to issue: Payor Payor
When to issue: 20th following the close of the 5th day of the
taxable Quarter employed by following month
the payee in filing his income tax
return or upon request of the payee
No. of copies: Three (3) copies Three (3) copies
Signed by: Both payor and payee Both payor and payee
(under the penalty of perjury) (under the penalty of perjury)

CS & TMD
General Course for Revenue Officers WT 230 Slide 62
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates
Income Subject to EWT Rate
A. Professional fees, talent fees, etc. 15% if the gross income for
for services rendered by individuals the current year exceeds
P720,000.00
1. Individuals engaged in the practice of
10% if P720,000 or less
profession or callings like Lawyers,
CPAs, Engineers, etc.

2. Professional entertainers, such as, but


not limited to, actors and actresses,
singers lyricist, composers and
emcees.

CS & TMD
General Course for Revenue Officers WT 230 Slide 63
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (cont.)

Income Subject to EWT Rate


A. Professional fees, talent fees, etc. 15% if the gross income for
for services rendered by individuals the current year exceeds
P720,000.00
3. Professional athletes, including
10% if P720,000 or less
basketball player, pelotaris and
jockeys.

4. All directors and producers involved


in movies, stage, radio, television and
musical productions.

5. Insurance agents and Insurance


adjusters
CS & TMD
General Course for Revenue Officers WT 230 Slide 64
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (cont.)
Income Subject to EWT Rate
A. Professional fees, talent fees, etc. 15% if the gross income for
for services rendered by individuals the current year exceeds
P720,000.00
6. Management and technical
10% if P720,000 or less
consultants.
7. Bookkeeping agents and agencies.
8. Other recipients of talent fees
9. Fees of directors who are not
employees of the company paying
such fees, whose duties are confined
to attendance at and participation in
the meetings of the board of directors.

CS & TMD
General Course for Revenue Officers WT 230 Slide 65
Affidavit - Declaration of Current
Years Gross Income
Republic of the Philippines )
Province of ___________________ ) SS
City/Municipality _______________ )

I, ____________, of legal age, single/married, residing at ________,


______________ , after being sworn in accordance with law, depose and say
that:

1. I am a/an [state nature of work] for which I receive talent fees;

2. As such, I have received a gross income of __________________


for the current year as of _________________, 20__________;

3. I am executing this Affidavit - Declaration as a requirement of


Revenue Regulations No. 12-2001 of the Bureau of Internal
Revenue in the determination of the applicable creditable withholding
tax rate (10% or 15%) to be imposed by withholding agent/s.

IN WITNESS WHEREOF, I have hereunto set my hand this ___ day of


_______ , 20__, in the City/Municipality of __________, Province of _______,
Philippines.

_______________
Affiant-Declarant

SUBSCRIBED and sworn to before me, in the City/Municipality of ____,


this ___ day of_______, 20__ by ________ with Community Tax Certificate No.
______ issued at __________________ on ___________________, 20___.

Notary Public
My commission expires on _______________
Doc. No. :______
Page NO. :______
Book No. :______
Series of 20 ______

CS & TMD
General Course for Revenue Officers WT 230 Slide 66
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)
Income Subject to EWT Rate
B. Professional fees, talent fees, etc. for 15% if the gross income for the
services of taxable juridical persons current year exceeds
P720,000.00
10% if P720,000 or less
C. Rentals
Real properties
Personal properties used in business in
5%
excess of P10,000 annually except RA
8556 (Financial Company Act of 1998)
Poles, satellites and transmission facilities
Billboards
D. Cinematographic film rentals & other 5%
payments

CS & TMD
General Course for Revenue Officers WT 230 Slide 67
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)
Income Subject to EWT Rate
E. Income payments to certain contractors:
2%
General engineering contractors
General building contractors
Specialty contractors
Other contractors
F. Income distribution to the beneficiaries 15%
of estate and trusts
G. Gross commission or service fees of 10%
customs, insurance, stocks, real estate,
immigration and commercial broker and
fees of agents of professional entertainers

CS & TMD
General Course for Revenue Officers WT 230 Slide 68
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)
Income Subject to EWT Rate
H. Payment by the general professional 15% if the gross income
partnership (GPP) to its partners for the current
I. Payments to medical/dental/veterinary year exceeds
services thru hospitals/clinics/health P720,000.00
maintenance organizations, including 10% if P720,000 or less
direct payments to service providers

CS & TMD
General Course for Revenue Officers WT 230 Slide 69
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)
Income Subject to EWT Rate
J. Gross selling price or total amount of
consideration or its equivalent paid to the
seller/owner for the sale, exchange or
transfer of real property classified as
ordinary asset:
exempt
1. Seller/transferor is exempt from CWT in
accordance with Sec. 2.57.5 of RR 2-98
With a selling price of P500,000 or less 1.5%
With a selling price of P500,000 but not
3.0%
more than P2,000,000
With a selling price of more than P2,000,000 5%

2. Seller/transferor is not habitually 6%


engaged in the real estate business

CS & TMD
General Course for Revenue Officers WT 230 Slide 70
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)
Income Subject to EWT Rate
K. Additional income payments to government 15%
personnel from importers, shipping and
airline companies or their agents for
overtime services
L. Certain income payments made by credit 1% on one-half of the
card companies gross amount paid

CS & TMD
General Course for Revenue Officers WT 230 Slide 71
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)

Income Subject to EWT Rate


M. Income payments made by Top 20,000
private corporations to their
local/resident suppliers of goods and
services other than those covered by
other rates of withholding tax
Supplier of goods 1%
Supplier of services 2%

Note: Provided, however, that for purchases involving agricultural products in their original state,
the tax required to be withheld under this sub-section shall only apply to purchases in excess of
the cumulative amount of Three Hundred Thousand Pesos (P300,000) within the same taxable
year. For this purpose, agricultural products in their original state as used in these regulations,
shall only include corn, coconut, copra, palay, rice, cassava, sugar cane, coffee, fruits,
vegetables, marine food products, poultry and livestocks.

CS & TMD
General Course for Revenue Officers WT 230 Slide 72
Criteria to be Used in the Identification as
Top 5,000 Individuals

a. VAT payment or payable, whichever is higher, of at least P100,000


for the preceding year;
b. Annual income tax due of at least P200,000 for the preceding year;
c. Total percentage tax paid of at least P100,000 for the preceding
year;
d. Gross sales of P10,000,000 and above for the preceding year;
e. Gross purchases of P5,000,000 and above for the preceding year;
f. Total excise tax payment of at least P100,000 for the preceding year.

CS & TMD
General Course for Revenue Officers WT 230 Slide 73
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)

Income Subject to EWT Rate


N. Income payments made by the government
to its local/resident suppliers of goods &
local/resident supplier of services other
than those covered by other rates of
withholding tax
Supplier of goods 1%
Supplier of services 2%

CS & TMD
General Course for Revenue Officers WT 230 Slide 74
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)
Income Subject to EWT Rate
O. Commissions, rebates, discounts and other 10%
similar considerations paid/granted to
independent and exclusive distributors,
medical/technical and sale representative
and marketing agents and sub-agents of
multi-level marketing companies
P. Tolling fees paid to refineries 5%
Q. Payments made by pre-need companies to 1%
funeral parlors

CS & TMD
General Course for Revenue Officers WT 230 Slide 75
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)
Income Subject to EWT Rate
R. Gross payments to embalmers by funeral 1%
companies
S. Income payments made to suppliers of 1%
agricultural products
Note: Suspended per RR 3-2004)
T. Income payments on purchases of minerals, 10%
mineral products and quarry resources as define
in section 151 of the NIRC
Income payments on purchases of gold by
BSP from gold miners/suppliers under PD
1899, as amended by RA 7076

CS & TMD
General Course for Revenue Officers WT 230 Slide 76
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)

Income Subject to EWT Rate


U. MERALCO Refund arising from Supreme
Court case G.R. No. 14814 of April 9, 2003
to customers under phase 4 as approved
by the ERC

Customers with active contracts 25%


Customers with terminated contracts
32%

CS & TMD
General Course for Revenue Officers WT 230 Slide 77
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)
Income Subject to EWT Rate
V. Withholding on gross amount of interest
on the refund of meter deposit whether
paid directly to the customers or applied
against customers billings
1. Residential and General Service 10%
customers as classified by Meralco
2. Non-residential customers as classified 10%
by Meralco
3. Residential and General Service 10%
customers as classified by other electric
Distribution Utilities (DU)
20%
4. Non-residential customers as classified
by other electric Distribution Utilities (DU)

CS & TMD
General Course for Revenue Officers WT 230 Slide 78
Income Payments Covered & Its Applicable
Expanded Withholding Tax Rates (Cont.)
Income Subject to EWT Rate
W. Income payments made by the top five
thousand (5,000) Individual Taxpayers to
their local/resident suppliers of goods and
local/resident suppliers of services other
than those covered by other rates of
withholding tax
1%
Supplier of goods
2%
Supplier of services
Note: Provided, however, that for purchases involving agricultural products in their original state,
the tax required to be withheld under this sub-section shall only apply to purchases in excess of
the cumulative amount of Three Hundred Thousand Pesos (P300,000) within the same taxable
year. For this purpose, agricultural products in their original state as used in these regulations,
shall only include corn, coconut, copra, palay, rice, cassava, sugar cane, coffee, fruits,
vegetables, marine food products, poultry and livestocks.

CS & TMD
General Course for Revenue Officers WT 230 Slide 79
Criteria to be Used in the Identification as
Top 20,000 Private Corporations

a. Classified and duly notified by the Commissioner as a large taxpayer


under Revenue Regulations No. 1-98, as amended (automatic
inclusion);
b. VAT payment or payable, whichever is higher, of at least P100,000
for the preceding year;
c. Annual income tax due of at least P200,000 for the preceding year;
d. Total percentage tax paid of at least P100,000 for the preceding
year;
e. Gross sales of P10,000,000 and above for the preceding year;
f. Gross purchases of P5,000,000 and above for the preceding year;
g. Total excise tax payment of at least P100,000 for the preceding year.

CS & TMD
General Course for Revenue Officers WT 230 Slide 80
Final Withholding Taxes

The amount of income tax withheld by the


withholding agent is constituted as a full and final
payment of the income tax due from the payee on the said
income.

The liability for payment of tax rests primarily on the


payor as a withholding agent. Failure to withhold the tax or in
case of under withholding, the deficiency tax shall be
collected from payor/withholding agent.

The payee is not required to file an income tax


return for the particular income.

CS & TMD
General Course for Revenue Officers WT 230 Slide 81
A. Income Payments to a Citizen or
to a Resident Alien Individual
Income Subject to FWT Rate
1. Interest from any peso bank deposit, and yield or 20%
any other monetary benefit from deposit
substitutes and from trust funds and similar
arrangements
Prizes [except prizes amounting to P10,000
or less which is subject to tax under Sec. 24
(A) (1) of the NIRC
Winning (except from Philippine Charity
Sweepstakes Office and lotto)
2. Royalties on books as well as other literary 10%
works and musical compositions

CS & TMD
General Course for Revenue Officers WT 230 Slide 82
A. Income Payments to a Citizen or
to a Resident Alien Individual (cont.)

Income Subject to FWT Rate


3. Prizes (except prizes amounting to P10,000 or 20%
less which is subject to tax under Sec. 24 (A) (1)
of the NIRC)
4. Winnings (except from Philippine Charity 20%
Sweepstakes Office and lotto)
5. Interest income received from a depository bank 7.5%
under Foreign Currency Deposit System

CS & TMD
General Course for Revenue Officers WT 230 Slide 83
A. Income Payments to a Citizen or to a
Resident Alien Individual (cont.)

Income Subject to FWT Rate


6. Interest income from long-term deposit or
investment in the form of savings, common
or individual trust funds, deposit substitutes,
investment management accounts and other
investments evidenced by certificates
prescribed by Bangko Sentral ng Pilipinas

Holding Period
Four (4) years to less than five (5) years 5%
Three (3) years to less than four (4) years 12%
Less than three (3) years 20%

CS & TMD
General Course for Revenue Officers WT 230 Slide 84
A. Income Payments to a Citizen or to a
Resident Alien Individual (cont.)

Income Subject to FWT Rate


7. Cash and/or property dividends actually or
constructively received from a domestic
corp., joint stock company, insurance or
mutual fund companies or on the share of
an individual partner - at the following rate:

Beginning January 1, 1998 6%


Beginning January 1, 1999 and 8%
Beginning January 1, 2000 and 10%
thereafter

CS & TMD
General Course for Revenue Officers WT 230 Slide 85
A. Income Payments to a Citizen or to a
Resident Alien Individual (cont.)
Income Subject to FWT Rate
8. On capital gains presumed to have been 6%
realized from the sale, exchange or other
disposition of real property located in the
Philippines, classified as capital assets
including pacto de retro sales and other form
of conditional sales
9. Gross Income derived from contracts by sub- 8%
contractors from service contractors engaged
in petroleum operation as defined under P.D.
87 (also known as the Oil Exploration and
Development Act) in the Philippines

CS & TMD
General Course for Revenue Officers WT 230 Slide 86
B. Income Payments to Non-resident Aliens Engaged
in Trade or Business in the Philippines

Income Subject to FWT Rate


1. On certain passive income 20%

a. Cash and/or property dividend from a


domestic corporation or from joint stock,
or from an insurance or mutual fund
company or from a regional operating
headquarters of a multinational company

b. Share in the distributable net income after


tax of a partnership of which he is a partner

CS & TMD
General Course for Revenue Officers WT 230 Slide 87
B. Income Payments to Non-resident Aliens Engaged
in Trade or Business in the Philippines

Income Subject to FWT Rate


c. Interests from any currency bank deposits 20%
and yield or any other monetary benefit
from deposit substitutes and from trust
funds and similar arrangements

d. Royalties (except royalties on books, as well 20%


as other literary works and musical
compositions which shall be subject to 10%)

e. Prizes exceeding P10,000 and other


winnings (except PCSO and Lotto Winnings) 20%

CS & TMD
General Course for Revenue Officers WT 230 Slide 88
B. Income Payments to Non-resident Aliens Engaged
in Trade or Business in the Philippines

Income Subject to FWT Rate


2. Interest income derived from long-term deposit
or investment in the form of savings, common
or individual trust funds, deposit substitutes,
investment management accounts and other
investments evidenced by certificates
prescribed by Bangko Sentral ng Pilipinas at
the following rate:

Holding Period

Four (4) years to less than five (5) years 5%


Three (3) years to less than four (4) years 12%
Less than three (3) years 20%

CS & TMD
General Course for Revenue Officers WT 230 Slide 89
B. Income Payments to Non-resident Aliens Engaged
in Trade or Business in the Philippines

Income Subject to FWT Rate


3. On capital gains presumed to have been realized 6%
from the sale, exchange or other disposition of real
property located in the Philippines, classified as
capital assets including pacto de retro sales and
other forms of conditional sales
4. Gross income from all sources within the Philippines 25%
derived by non-resident cinematographic film
owners, lessors or distributors
5. Gross income derived from contracts by 8%
subcontractors from service contractors engaged
in petroleum operation as defined under P.D.87
(also as the Oil Exploration and Development
Act) in the Philippines

CS & TMD
General Course for Revenue Officers WT 230 Slide 90
C. Income Derived Within the Philippines by a Non-resident
Alien Individual Not Engaged In Trade or Business

Income Subject to FWT Rate


1. On the gross amount of income derived from 25%
all sources as interest, cash and/or property
dividends, rents, salaries, wages, premiums,
annuities, compensation, remuneration,
emoluments, or other fixed or determinable
annual or periodic or casual gains, profits
and income and capital gains

2. On capital gains presumed to have been 6%


realized from the sale, exchange or other
disposition of real property located in the
Philippines, classified as capital assets

CS & TMD
General Course for Revenue Officers WT 230 Slide 91
D. Income Derived by Alien Individuals Employed by Regional
or Area Headquarters & Regional Operating Headquarters
of Multinational Companies

Income Subject to FWT Rate


1. On gross income received by every alien 15%
individual occupying managerial & technical
positions as salaries, wages, annuities,
compensation, remuneration, & other
emoluments except income subject to
fringe benefit tax

CS & TMD
General Course for Revenue Officers WT 230 Slide 92
E. Income Derived by Alien Individual Employed by
Offshore Banking Units

Income Subject to FWT Rate


1. On gross income received as salaries, wages, 15%
annuities, compensation, remuneration, &
other emoluments

CS & TMD
General Course for Revenue Officers WT 230 Slide 93
F. Income of Aliens Employed by Foreign Petroleum
Service Contractors and Subcontractors

Income Subject to FWT Rate


1. On gross income of an alien individual who is a 15%
permanent resident of a foreign country but who
is employed and assigned in the Philippines by
a foreign service contractor or by a foreign
service subcontractor who is engaged in a
petroleum operations in the Philippines

The same tax treatment shall apply to Filipinos


who are employed and occupying the same
positions as those of aliens engaged by foreign
petroleum service contractors or subcontractors.

CS & TMD
General Course for Revenue Officers WT 230 Slide 94
G. Income Payment to a Domestic
Corporation
Income Subject to FWT Rate
1. Interest from any currency bank deposit & yield or 20%
any other monetary benefit from deposit
substitutes & from trust fund & similar arrangements
derived from sources within the Philippines

2. Royalties derived from sources within the Philippines 20%

3. Interest derived from a depository bank under 7.5%


the Expanded Foreign Currency Deposit
System, otherwise known as a Foreign
Currency Deposit Unit (FCDU)

CS & TMD
General Course for Revenue Officers WT 230 Slide 95
G. Income Payment to a Domestic
Corporation
Income Subject to FWT Rate
4. Income derived by a Depository Bank under 10%
the FCDU from foreign transactions with
local commercial banks
5. On capital gains presumed to have been realized 6%
from sale, exchange or other disposition of land
and building located in the Philippines classified
as capital assets

6. Gross Income derived from contracts by sub- 8%


contractors from service contractors engaged in
petroleum operation as defined under P.D. 87
(also known as the Oil Exploration and
Development Act) in the Philippines

CS & TMD
General Course for Revenue Officers WT 230 Slide 96
H. Income Payment to a Resident
Foreign Corporation
Income Subject to FWT Rate
1. Offshore Banking Units 10%

2. Tax on Branch Profit Remittances 15%

3. Interest on any currency bank unit deposit & yield 20%


or any other monetary benefit from deposit
substitutes & from trust funds & similar arrange-
ments & royalties derived from sources within the
Philippines

4. Interest income derived from a Depository Bank 7.5%


under the Expanded Foreign Currency Deposit
System

CS & TMD
General Course for Revenue Officers WT 230 Slide 97
H. Income Payment to a Resident
Foreign Corporation (cont.)
Income Subject to FWT Rate
5. Income derived by the depository bank under the 10%
expanded foreign currency deposit system from
foreign currency transactions with local
commercial banks including branches of foreign
banks that may be authorized by the Bangko
Sentral ng Pilipinas

6. Gross Income derived from contracts by sub- 8%


contractors from service contractors engaged in
petroleum operation as defined under P.D. 87
(also known as the Oil Exploration and
Development Act) in the Philippines

CS & TMD
General Course for Revenue Officers WT 230 Slide 98
I. Income Derived from All Sources Within the Philippines
by Non-resident Foreign Corporations
Income Subject to FWT Rate
1. Interests, dividends, rents, royalties, salaries,
premiums (except reinsurance premiums),
annuities, emoluments, or other fixed or
determinable annual, periodic or casual gains,
profits & income & capital gains (except capital
gains realized from sale, exchange, disposition
of shares of stock in any domestic corporation)
subject to the following rates:
34%
34% - beginning January 1, 1998
33% - beginning January 1, 1999 and 33%
32% - beginning January 1, 2000 and 32%
thereafter
35% - beginning January 1, 2005 35%
30% - beginning January 1, 2009 30%

CS & TMD
General Course for Revenue Officers WT 230 Slide 99
I. Income Derived from All Sources Within the Philippines
by Non-resident Foreign Corporations
Income Subject to FWT Rate
2. Gross income from all sources within the 25%
Philippines derived by non-resident
cinematographic film owners, lessors or
distributors

3. On the gross rentals, lease & charter fees, 4.5%


derived by non-resident owner or lessor
of vessels from leases or charters to
Filipino citizens or corporations as
approved by the Maritime Industry Authority

CS & TMD
General Course for Revenue Officers WT 230 Slide 100
I. Income Derived from All Sources Within the Philippines
by Non-resident Foreign Corporations
Income Subject to FWT Rate
4. On the gross rentals, charter & other fees 7.5%
derived by non-resident lessor of aircraft,
machineries & other equipment
5. Interest on foreign loans contracted on or 20%
after August 1, 1986
6. Dividends received from a domestic corporation 15%
subject to the condition that the country in which the
non-residents foreign corporation is domicile.

CS & TMD
General Course for Revenue Officers WT 230 Slide 101
J. Fringe Benefits Granted to Employees
(Except Rank and File Employee)
Fringe Benefit means any good, service or other
benefits furnished or granted in cash or in kind by an employer to
an individual employee (except rank and file) such as but not limited
to the following:
housing;
expense account;
vehicle of any kind;
household personnel (maid, driver and others);
interest on loan at less than market rate to the extent of the
difference between the market rate and actual rate granted;
membership fees, dues and other expenses borne by the
employer for the employee in social and athletic clubs or
other similar organizations;
expenses for foreign travel;
holiday and vacation expenses;
educational assistance to employee or his dependents; and
life or health insurance and other non-life insurance premiums
or similar amounts in excess of what the law allows.

CS & TMD
General Course for Revenue Officers WT 230 Slide 102
Fringe Benefit Tax Rate

The Fringe Benefit Tax Rate (FBT) shall be:

1998 - 34%
1999 - 33%
2000 and thereafter - 32%

The gross up divisor shall be:

1998 - 66%
1999 - 67%
2000 and thereafter - 68%

CS & TMD
General Course for Revenue Officers WT 230 Slide 103
K. Informers Reward

Income Subject to FWT Rate


1. Informers reward to persons instrumental in the 10%
discovery of violators of the NIRC and the
discovery and seizure of smuggled goods

CS & TMD
General Course for Revenue Officers WT 230 Slide 104
Withholding of Final Value-Added Tax Rate

Payments for purchases of:


Goods - 5%

Services - 5%

Payments for lease or use - 12%


of properties or property
rights to non-resident owners

Other services rendered in the - 12%


Philippines by non-residents

CS & TMD
General Course for Revenue Officers WT 230 Slide 105
Withholding on Percentage Tax

Nature of payments subject to Rate


percentage tax
1. Persons exempt from VAT 3%

2. Domestic carries and keepers of garages 3%

3. International Carriers 3%
a. On gross payments to international air carriers doing
business in the Philippines.
b. On gross payments to international shipping carriers
doing business in the Philippines.

4. Franchises tax on radio and TV broadcasting companies 3%


whose annual gross receipts do not exceed P10 M and
who are not VAT - registered taxpayers

CS & TMD
General Course for Revenue Officers WT 230 Slide 106
Withholding on Percentage Tax (cont.)

Nature of payments subject to Rate


percentage tax
Tax on life insurance premiums 5%
Person exempt from VAT under Sec. 109 (z) 3%
Tax on overseas dispatch, message or conversion 10%
from the Philippines
Business tax on agents of foreign insurance 10%
company, insurance agents
Business tax on agents of foreign insurance 5%
company, owner of the property

CS & TMD
General Course for Revenue Officers WT 230 Slide 107
Withholding on Percentage Tax (cont.)

Nature of payments subject to Rate


percentage tax
Tax on international carriers 3%
Tax on cockpits 18%
Tax on cabaret, night and day clubs 18%
Tax on boxing exhibitions 10%
Tax on professional basketball games 15%
Tax on jai-alai and race tracks 30%

CS & TMD
General Course for Revenue Officers WT 230 Slide 108
Withholding on Percentage Tax (cont.)

Nature of payments subject to Rate


percentage tax
Tax on sale, barter or exchange of stocks listed 1/2 of 1%
and traded through Local Stock Exchange

Tax on royalties, rentals of property, and all other 5%


gross income earned by banks & non-banks
financial intermediaries

Tax on interest, discounts and other items of gross 5%


income paid to finance companies & other financial
intermediaries not performing quasi-banking
functions

CS & TMD
General Course for Revenue Officers WT 230 Slide 109
Withholding on Percentage Tax (cont.)

Nature of payments subject to Rate


percentage tax
On interest, commissions & discounts paid from
their loan transactions from finance companies
as well as leasing based on the remaining
maturities of the of the instruments
Short term maturity [not exceeding two (2) years] 5%
Medium term maturity [over two (2) years but not 3%
exceeding four (4) years]
Long term maturity
- Over four (4) years but not exceeding 1%
seven (7) years
- Over seven (7) years 0%

CS & TMD
General Course for Revenue Officers WT 230 Slide 110
Withholding Tax on Government
Money Payment

Simplify, streamline, and make more efficient


the collection of tax thru withholding at
source:

 percentage tax on sales of


goods or services

 VAT on sales of goods or


services

CS & TMD
General Course for Revenue Officers WT 230 Slide 111
Persons Required to Withhold (Requirements)
Final VAT / Final Percentage Tax
Final Percentage Tax Final Value-Added Tax
BY BY
Any person, natural or Any person, natural or
juridical, with respect to the juridical, with respect to the
purchase of goods or purchase of goods or
payments for purchase of payments for purchase of
services subject to 3% services subject to VAT
percentage tax under Sec. under Sec. 106 & 108 made
116 made in the course of in the course of trade or
trade or business (including business (including exercise
exercise of profession or of profession or calling)
calling)

CS & TMD
General Course for Revenue Officers WT 230 Slide 112
Persons Required to Withhold (Requirements)
Final VAT / Final Percentage Tax (cont.)
FROM FROM
NON-VAT registered persons VAT registered persons subject
subject to the 3% percentage to Value Added Tax
tax (whose gross annual sales
or receipts do not exceed
P1,500,000 and who do not opt
to be registered as VAT
taxpayer)
RATE 3% RATE 12%
CONDITION Opts to remit VAT
CONDITION Opts to remit PT
thru the withholding
thru the withholding system /
system; executes waiver
files notice of availment of the
of claim of input tax credits
option
and notice of availment of
the option

CS & TMD
General Course for Revenue Officers WT 230 Slide 113
Persons Required to Withhold
Purchase of goods / services
- by the agents / employees or any person purchasing goods / services
Official Receipt shall be in the name of person they represent
Certificate of Taxes Withheld (BIR Form No. 2307) shall be issued

Income payments which are subjected to withholding tax


- by the person having control over the payment, who at the same time,
claims expenses
Income payments made through broker / agents / persons
authorized to collect/receive payments for and on behalf of payee
- by the person having control over the payment
Note:
Obligation to withhold is imposed upon the buyer-payor although the
burden of tax is really upon the seller-income earner.
All government offices including GOCC, as well as provincial, city &
municipal government.

CS & TMD
General Course for Revenue Officers WT 230 Slide 114
Returns & Payments of Taxes Withheld
on Final VAT/Final Percentage Tax

Final Value-Added Tax Withholding /


Final Percentage Tax Withholding

BIR Form No. 1600 (Monthly Remittance Return of


VAT & Other Percentage Taxes Withheld)

No. of copies Three (3) copies

CS & TMD
General Course for Revenue Officers WT 230 Slide 115
Returns & Payments of Taxes Withheld
on Final VAT/Final Percentage Tax
Where to file/pay:
a. Authorized Agent Banks (AABs) under the
jurisdiction of the LTS & LTDO in case of large
taxpayers; or

b. AABs under the jurisdiction of the RDO where the


withholding agent is located in case of non-large
taxpayers; or
c. Revenue Collection Officer (RCO) or duly authorized
Treasurer of the City or Municipality where the WA is
required to register (in the absence of AABs)

CS & TMD
General Course for Revenue Officers WT 230 Slide 116
Returns & Payments of Taxes Withheld
on Final VAT/Final Percentage Tax

When to file/pay:

Within ten (10) days following the end of the month


the withholding was MADE.

(If WA is enrolled in EFPS, filing of returns and


payment of taxes are governed by EFPS rules and
regulations)

CS & TMD
General Course for Revenue Officers WT 230 Slide 117
Certificate of Tax Withheld -
Payee with Only One Payor

Percentage Tax Value-Added Tax


BIR Form No. 2306 (Certificate BIR Form No. 2306 (Certificate of
of Final Tax Withheld at Source) Final Tax Withheld at Source)
No. of copies Four (4) No. of copies Four (4)
a. Two (2) copies to the payee a. Two (2) copies to the payee
given within ten (10) days given within ten (10) days
following the end of the month following the end of the month
the withholding was made the withholding was made
b. One copy file copy of WA b. One copy file copy of WA
c. One copy copy to be c. One copy copy to be
attached to the filed BIR Form attached to the filed BIR
No. 1600 Form No. 1600

CS & TMD
General Course for Revenue Officers WT 230 Slide 118
Certificate of Tax Withheld -
Payee with Only One Payor (cont.)

Percentage Tax Value-Added Tax


Signed by both the payee Signed by both the payee
and WA. and WA.
Serves as the authority Serves as the authority given by
given by the payee to the the payee to the payor to file and
payor to file and consider consider the payors duly filed
the payors duly filed BIR BIR Form No. 1600 as the
Form No. 1600 as the substituted VAT return.
substituted percentage tax B. Constituted and treated as
return. substituted official receipt (for
seller of service).

CS & TMD
General Course for Revenue Officers WT 230 Slide 119
Certificate of Tax Withheld -
Payee with Several Payor

Percentage Tax Value-Added Tax


B. BIR Form No. 2307 (Certificate BIR Form No. 2307 (Certificate
of Creditable Tax Withheld at of Creditable Tax Withheld
Source) at Source)
No. of copies: Four (4) No. of copies: Four (4)
a. Two copies for attachment a. Two copies for attachment to
to percentage tax return VAT return (BIR Form No.
(BIR Form No. 2551M) 2550Q)
b. One copy attached to the b. One copy attached to the
filed BIR Form No. 1600 filed BIR Form No. 1600
c. One copy file copy of c. One copy - file copy of payor
payor

CS & TMD
General Course for Revenue Officers WT 230 Slide 120
Substituted Official Receipts

Seller of services whose gross receipts were subjected to


withholding of 3% percentage tax / 10% VAT are exempted
from issuing non-VAT/ VAT receipts. In lieu thereof:

BIR Form No. 2306 BIR Form No. 2307


for Payees with for Payees with
just ONE payor SEVERAL payors

shall be constituted and treated as the substituted official


receipts.

CS & TMD
General Course for Revenue Officers WT 230 Slide 121
Substituted Returns

Payee with only 1 payor

NO longer required to file the Monthly Percentage Tax/


Monthly & Quarterly Value Added Tax return/s (BIR
Form Nos. 2551M / 2550M & 2550Q).

The filed BIR Form No. 1600 serves as the substituted


return of the payee provided that BIR Form No. 2306
executed and signed by both payor and payee is
attached to the filed BIR Form No. 1600.

Payee is not entitled to input tax credit.

CS & TMD
General Course for Revenue Officers WT 230 Slide 122
Substituted Percentage Tax Return
(BIR Form No. 1600)
Allowed if the income recipient/payee
1. has only one payor
2. has filed with the RDO
a. Notice of Availment of the Option to
Pay the Tax through the Withholding
Process
b. Notice of Availment of the Substituted
Filing of Percentage Tax Return
copy furnished the lone payor and the
RDO of both the payor and the payee
3. updates his registration with his home RDO
4. the three percent (3%) percentage tax has been
withheld and remitted by the lone payor

CS & TMD
General Course for Revenue Officers WT 230 Slide 123
Substituted VAT Return
(BIR Form No. 1600)
Allowed if the income recipient/payee
1. has only one payor
2. has filed with the RDO
a. Notice of Availment of the Option to
Pay the Tax through the Withholding
Process
b. Notice of Availment of the Substituted
Filing of VAT Return copy
c. Waiver of the Privilege to Claim Input Tax Credit
copy furnished the lone payor and the RDO
of both the payor and the payee
3. updates his registration with his home RDO
4. the ten percent (10%) VAT has been withheld and
remitted by the lone payor

CS & TMD
General Course for Revenue Officers WT 230 Slide 124
Regular Percentage and VAT Returns
Payees with several payors (all sales receipts are subject to withholding)

Percentage Tax Value-Added Tax


Still required to file percentage Still required to file the regular
tax return (2551M) value added tax return (2550Q)
Tax withheld can be deducted Tax withheld can be deducted
as tax credit as tax credit
No tax payable
No tax payable BIR Form No. 2550Q merely a
BIR Form No. 2551M merely a consolidation of all taxable
consolidation of all taxable transactions
transactions To be filed with the appropriate
BIR offices
To be filed with the appropriate Payee not entitled to input tax
BIR offices credit

CS & TMD
General Course for Revenue Officers WT 230 Slide 125
Regular Percentage and VAT Returns
Payees with several payors (incorrect withholding/
transactions with non-business engaged payors)

Percentage Tax Value-Added Tax


Still required to file percentage Still required to file the regular
tax / VAT return/s (2551M) value added tax return
(2550M/2550Q)
Tax withheld can be deducted Tax withheld can be deducted as
as tax credit tax credit
BIR Form Nos. 2551M shall BIR Form Nos. 2550M / 2550Q
reflect an amount payable shall reflect an amount payable
To be filed in the appropriate
To be filed with the AABs / BIR offices
RDOs Payee not entitled to input tax
credit

CS & TMD
General Course for Revenue Officers WT 230 Slide 126
Option to REMIT Tax under the
Withholding Tax System

1. The option to REMIT the percentage tax/ VAT


once chosen remains as the manner of
remitting the tax unless cancelled by the
payee (Notice of Cancellation of Availment of
the Option to Pay the Tax through the
Withholding Process)

CS & TMD
General Course for Revenue Officers WT 230 Slide 127
Notice of Availment of the Option

Notice of Availment of the To be filed with the RDO copy


Option to Pay the Tax furnished the payor-withholding
Through the Withholding agent and the RDO of both the
Process payor and the payee.

Notice of Availment of To be filed with the RDO where


Substituted Filing of the income recipient is registered
Percentage Tax Return/ or required to register, copy
VAT Return furnished the lone payor of
(for payee with only one income.
payor)

CS & TMD
General Course for Revenue Officers WT 230 Slide 128
Notice of Availment of the Option (cont.)

Waiver of the Privilege to To be executed and furnished the


Claim VAT Input Tax Credits payor-withholding agent
and the RDO of both payor
and payee.

CS & TMD
General Course for Revenue Officers WT 230 Slide 129
Cancellation of Availment

When to file

Notice of 10th day of the Automatic


Cancellation of month following the reversion to regular
Availment of close of the taxable filing procedure
Substituted Filing year
of Return
Immediately Additional client or
customer comes in
within the taxable
year

CS & TMD
General Course for Revenue Officers WT 230 Slide 130
Quarterly Submission of SLSPs

VAT-registered taxpayers shall still comply with


the conditions set forth by RR No. 8-2002
regarding the submission of Summary List/s of
Sales/Domestic Purchases/Importations.

CS & TMD
General Course for Revenue Officers WT 230 Slide 131
Privilege Store

It refers to a stall or outlet, popularly known as


tiangge;

It is not registered with the BIR;

It is not permanently fixed to the ground, normally set up


in places like shopping malls, hospitals, office buildings,
hotels, villages, subdivisions, churches, parks,
sidewalks, streets, and other public places, for the
purpose of selling a variety of goods for short duration of
time/special events; and

If the duration exceed six (6) months in any taxable year,


then it shall not be considered a privilege store.

CS & TMD
General Course for Revenue Officers WT 230 Slide 132
Exhibitor/Organizer

The primary lessee of the entire space where the


operations of privilege stores are held by virtue of a
lease contract executed between the owner of the
leased property and the organizer who subsequently
sub-leases the same to the privilege store operators
during the entire duration of the lease contract.

In case the owner of the real property is the one


directly leasing to the privilege-store operator, such
owner shall be constituted as the exhibitor or
organizer.

CS & TMD
General Course for Revenue Officers WT 230 Slide 133
Privilege-Store Operator

It refers to a person or entity leasing from the


lessor/owner or sub-leasing from the exhibitor or
organizer a space upon which privilege stores are
erected for the purpose of selling goods or services
during the entire duration of the lease contract.

CS & TMD
General Course for Revenue Officers WT 230 Slide 134
Obligations of the Exhibitor/Organizer

1. To post in a conspicuous place the Certificate of


Registration (COR) of the organizer

If such organizer is not yet registered, then he must


register at least fifteen (15) days before commencement
of privilege stores activity

It shall be valid within the calendar year

CS & TMD
General Course for Revenue Officers WT 230 Slide 135
Obligations of the Exhibitor/Organizer (cont.)

2. To deduct and withhold the Expanded Withholding


Tax on Lease Payments to the Lessor of Real Property
Withhold five percent (5%) of the gross amount of rentals
Remit/pay on or before the 10th day of the following month
for January -November
Taxes filed for the month of December of each year shall be
filed on or before January 15 of the following year
Use the Monthly Remittance Return of Creditable
Withholding Taxes Withheld (Expanded) (BIR Form No.
1601E)
Electronic Filing and Payment System (eFPS) filers shall
follow procedures using eFPS

CS & TMD
General Course for Revenue Officers WT 230 Slide 136
Obligations of the Exhibitor/Organizer (cont.)

3. To inform Revenue District Office

He must provide RDO with the list of the name, residence


addresses, stall number/slot, location site, TIN of
persons/entities participating in the event and the specific
dates and duration of the operation.

4. To ensure presentation of TIN, the Remittance of Actual


Withholding Tax Liabilities and of Advance Percentage Tax
by the Privilege-Store Operator

5. To report to the Bureau non-compliance by the privilege-


store operators of their obligations and responsibilities

CS & TMD
General Course for Revenue Officers WT 230 Slide 137
Obligations of Privilege-
Store Operator
1. To deduct and withhold the Expanded Withholding Tax
on Rental Payments to exhibitor/organizer for sub-
leased spaces of lessor/owner of leased property

Withhold five percent (5%) of the gross amount of rentals


Remit/pay on or before the 10th day of the following
month for January -November
Taxes filed for the month of December of each year shall
be filed on or before January 15 of the following year.
Use the Monthly Remittance Return of Creditable
Withholding Taxes Withheld (Expanded) (BIR Form No.
1601E)
Electronic Filing and Payment System (eFPS) filers shall
follow procedures using eFPS

CS & TMD
General Course for Revenue Officers WT 230 Slide 138
Obligations of Privilege-
Store Operator (cont.)
2. To pay Advanced Percentage Tax

It shall be paid to the BIR through the Authorized Agent


Bank (AAB) or Revenue Collection Officer (RCO).
In the absence of AAB, it shall be paid through the
Revenue District Office (RDO) having jurisdiction over
such privilege stores.
It shall be paid on a monthly basis using BIR Form No.
0605 on or before its operation and the 1st day of every
month thereafter
If operation is less than one (1) month, advance payment
shall cover only said lesser period

CS & TMD
General Course for Revenue Officers WT 230 Slide 139
Imposition of Advanced Payment of Taxes

SET-UP IN
AN AIR- NON AIR-
CONDITIONED CONDITIONED
PLACE PLACE
CITY/FIRST CLASS P150 per day or * P100 per day or *
MUNICIPALITY P4,500 a month P3,000 a month
MUNICIPALITY P75 per day or * P50 per day or *
OTHER THAN FIRST P2,500 a month P1,500 a month
CLASSMUNICIPALITY

CS & TMD
General Course for Revenue Officers WT 230 Slide 140
Cessation as Privilege Store

A business activity ceases to be a privilege


store when it is registered with the BIR and
complies with its bookkeeping requirements.

CS & TMD
General Course for Revenue Officers WT 230 Slide 141
Proof of Advance Payment

Duly validated copy of BIR Form No. 0605; and

Official Receipt/Deposit Slip issued by the AAB or


the RCO in the absence of an AAB, of the RDO
having jurisdiction over the place where the
privilege-store operates.

CS & TMD
General Course for Revenue Officers WT 230 Slide 142
Implementing Guidelines

1.All RDOs shall be primarily responsible in monitoring


compliance by the organizer/exhibitor of his obligation, its
activities as well as in validating the list furnished by the
exhibitor/organizer regarding the identity and number of
participants as well as duration of exhibit.
2. The RDO shall recommend the issuance by the Regional
Director of Mission Order/s to deploy RCOs or Revenue
Officers who shall be in charge of:
Physically checking compliance of obligations; and
Monitoring and checking whether advance payments of
business tax and actual payment of the withholding tax
on rentals and other income payments subject to
withholding tax have been duly made by the operators
of the privilege stores.

CS & TMD
General Course for Revenue Officers WT 230 Slide 143
Implementing Guidelines (cont.)

3. Advance payment shall be made on a monthly basis which


shall be paid a week before the start of every month and
remitted to the AAB or RCO, using BIR Form No. 0605,
unless duration is for a lesser period.
Notes:

In all cases, advance payment shall always be made


within the week prior to the actual start of the exhibit.

The advance payment shall be equal to the number of


days of operation in a months time for which the
advance payment shall be applied for.

CS & TMD
General Course for Revenue Officers WT 230 Slide 144
Time of Filing and eFiling of Other Taxes

Taxes Affected by the Acceleration of Filing of Returns and Payment Taxes Due
Thereon (see RR 6-2001 as amended by RR 12-2001& further amended by RR 4-2002)

Tax From To (Manual) To (EFPS)


1. Creditable and NOTE: All EFPS must
final withholding follow the staggered
tax filing of return

a. Non-Large Within 10 days Within 10 days Within 15 days after


Taxpayer after the end of after the end of the
each month each month end of each month

b. Large Taxpayer Within 25 days Within 10 days Within 15 days after


after the end of after the end of the
the month the month end of the month

CS & TMD
General Course for Revenue Officers WT 230 Slide 145
Time of Filing and eFiling of
Other Taxes (cont.)
Taxes Affected by the Acceleration of Filing of Returns and Payment Taxes Due
Thereon (see RR 6-2001 as amended by RR 12-2001& further amended by RR 4-2002)

Tax From To (Manual) To (EFPS)


2. Creditable and NOTE: All EFPS
final withholding must follow the
tax for the month staggered
December filing of return

a. Non-Large On or before On or before On or before


Taxpayer January 25 of the January 15 of the January 20 of the
following year following year following year

b. Large Taxpayer On or before On or before On or before


January 25 of the January 15 of the January 20 of the
following year following year following year

CS & TMD
General Course for Revenue Officers WT 230 Slide 146
Time of Filing and eFiling of
Other Taxes (cont.)
Taxes Affected by the Acceleration of Filing of Returns and Payment Taxes Due
Thereon (see RR 6-2001 as amended by RR 12-2001& further amended by RR 4-2002)

Tax From To (Manual) To (EFPS)


3. Final withholding tax NOTE: All EFPS
on interest from any must follow the
currency bank staggered
deposits and yield or filing of return
any other monetary
benefit from deposit
substitutes and from
trusts funds and
similar arrangements:

CS & TMD
General Course for Revenue Officers WT 230 Slide 147
Time of Filing and eFiling of
Other Taxes (cont.)
Taxes Affected by the Acceleration of Filing of Returns and Payment Taxes Due
Thereon (see RR 6-2001 as amended by RR 12-2001& further amended by RR 4-2002)

Tax From To (Manual) To (EFPS)


a. Non-Large Within 25 days For Jan. to Nov.- within For January to November-
Taxpayer from the close of 10 days after the end of within 15 days after the
each calendar each month end of each month
quarter For December- on or For December- on or
before January 15 of before January 20 of the
the following year following year

b. Large Within 25 days For Jan. to Nov.-within For January to November -


Taxpayer from the close of 10 days after the end within 15 days after the
each calendar of each month end of each month
quarter For December- on or For December- on or
before January 15 of before January 20 of the
the following year following year

CS & TMD
General Course for Revenue Officers WT 230 Slide 148
Time of Filing and eFiling of
Other Taxes (cont.)
Taxes Affected by the Acceleration of Filing of Returns and Payment Taxes Due
Thereon (see RR 6-2001 as amended by RR 12-2001& further amended by RR 4-2002)

Tax From To (Manual) To (EFPS)


4. Withholding tax on NOTE: All EFPS
compensation must follow the
(excluding the staggered
month of filing of return
December:

CS & TMD
General Course for Revenue Officers WT 230 Slide 149
Time of Filing and eFiling of
Other Taxes (cont.)
Taxes Affected by the Acceleration of Filing of Returns and Payment Taxes Due
Thereon (see RR 6-2001 as amended by RR 12-2001& further amended by RR 4-2002)

Tax From To (Manual) To (EFPS)


a. Non-Large On or before the On or before the 10th On or before the 15th
Taxpayer 10th day of the day of the month day of the month
month following following the month following the month in
the month in which in which withholding which withholding was
withholding was was made made
made

b. Large On or before 25th On or before the 10th On or before the 15th


Taxpayer day of the day of the month day of the month
following month following the month following the month in
in which withholding which withholding was
was made made

CS & TMD
General Course for Revenue Officers WT 230 Slide 150
Time of Filing and eFiling of
Other Taxes (cont.)
Taxes Affected by the Acceleration of Filing of Returns and Payment Taxes Due
Thereon (see RR 6-2001 as amended by RR 12-2001& further amended by RR 4-2002)

Tax From To (Manual) To (EFPS)


5. Withholding tax NOTE: All EFPS
on compensation must follow the
for the month of staggered filing of
December: return

a. Non-Large Not later than Not later than Not later than
Taxpayer January 25 of January 15 of the January 20 of the
the following year following year following year

b. Large Taxpayer On or before the Not later than Not later than
25th day of the January 15 of January 20 of the
following month following year

CS & TMD
General Course for Revenue Officers WT 230 Slide 151
Time of Filing and eFiling of
Other Taxes (cont.)
Taxes Affected by the Acceleration of Filing of Returns and Payment Taxes Due
Thereon (see RR 6-2001 as amended by RR 12-2001& further amended by RR 4-2002)

Tax From To (Manual) To (EFPS)


6. Final income NOTE: All EFPS
taxes withheld must
on fringe benefits follow the staggered
to employee filing of return
other than rank
and file:
(BIR Form 1603)

CS & TMD
General Course for Revenue Officers WT 230 Slide 152
Time of Filing and eFiling of
Other Taxes (cont.)
Taxes Affected by the Acceleration of Filing of Returns and Payment Taxes Due
Thereon (see RR 6-2001 as amended by RR 12-2001& further amended by RR 4-2002)

Tax From To (Manual) To (EFPS)


a. Non-Large On or before the 10th On or before the 15th
Taxpayer day of the month day of the month
following the calendar following the calendar
quarter in which the quarter in which the
fringe benefits were fringe benefits were
granted granted

b. Large On or before the 10th On or before the 15th


Taxpayer day of the month day of the month
following the calendar following the calendar
quarter in which the quarter in which the
fringe benefits were fringe benefits were
granted granted

CS & TMD
General Course for Revenue Officers WT 230 Slide 153
Time of Filing and eFiling of
Other Taxes (cont.)
Taxes Affected by the Acceleration of Filing of Returns and Payment Taxes Due
Thereon (see RR 6-2001 as amended by RR 12-2001& further amended by RR 4-2002)
Tax From To (Manual) To (EFPS)
7. Documentary Within 10 days after the Within 5 days after the
stamp tax: close of the month when close of the month
a. Non-Large the taxable document when the taxable
Taxpayer was made, signed, document was made,
accepted, or signed, accepted, or
transferred transferred

b. Large Within 10 days after the Within 5 days after the


Taxpayer close of the month when close of the month
the taxable document when the taxable
was made, signed, document was made,
accepted or transferred signed, accepted, or
transferred

CS & TMD
General Course for Revenue Officers WT 230 Slide 154
Time of Withholding

A. Ordinarily, the obligation of the payor to deduct and


withhold arises:
at the time an income payment is paid or payable; and
income payment is accrued or recorded as an expense or
asset, whichever is applicable in the payors books,
whichever comes first.

B. When income is not yet paid or payable but has been


recorded as an expense or asset, whichever is applicable,
in the payors books:
last month of the return period in which the same is
claimed as an expense or amortized for tax purposes.

CS & TMD
General Course for Revenue Officers WT 230 Slide 155
Payees Claiming or Applying the Creditable
Taxes Withheld (BIR Form No. 2307)
Attachment to the following:
Individual Payee
BIR Form 1701Q - Quarterly Income Tax Return
BIR Form 1701 - Annual Income Tax Return
Corporate Payee
BIR Form 1702Q - Quarterly Corporate Income Tax Return
BIR Form 1702 - Annual Income Tax Return
Creditable VAT Withheld
BIR Form 2550M - Monthly VAT Declaration
BIR Form 2550Q - Quarterly VAT Return
Creditable Percentage Taxes Withheld
BIR Form 2551M - Monthly Percentage Tax Return
BIR Form 2551Q - Quarterly Percentage Tax Return

CS & TMD
General Course for Revenue Officers WT 230 Slide 156
Details Required Under Schedule Summary of
Creditable Withholding Tax (BIR Form No. 2307)

Payors Name;
Nature of Income Payment;
Period Covered;
Tax Base;
Rate;
Applied Tax Withheld; and
Unapplied Tax Withheld in the Current Return.

CS & TMD
General Course for Revenue Officers WT 230 Slide 157
Withholding Agent

Withholding Agent - is any person or


entity who is in control of the payment
subject to withholding tax and therefore is
required to deduct and remit the taxes
withheld to the government. A Withholding
agent can be an individual, a corporation, a
financial institution or a government agency.

CS & TMD
General Course for Revenue Officers WT 230 Slide 158
Duties & Obligations of a
Withholding Agent

To register

To deduct and withhold

To remit the tax withheld

To file withholding
tax returns

To issue withholding
tax certificate

CS & TMD
General Course for Revenue Officers WT 230 Slide 159
Withholding Tax Returns

A. Remittance Returns
Form 1600 - Monthly Remittance of VAT and Other
Percentage Taxes Withheld (with Alphalists of
Payees)
Form 1600 WP- Remittance Return of Percentage Tax on
Winnings and Prizes Withheld by Racetrack
Operators
Form 1601 C - Monthly Remittance Return of Income Taxes
Withheld on Compensation
Form 1601 E - Monthly Remittance of Creditable Income
Taxes Withheld (Expanded)
(with Monthly Alphalists of Payees (MAP)

CS & TMD
General Course for Revenue Officers WT 230 Slide 160
Withholding Tax Returns (cont.)

Form 1601 F - Monthly Remittance Return of Final Income


Taxes Withheld
(with Monthly Alphalists of Payees (MAP)
Form 1602 - Monthly Remittance Return of Final Income
Taxes Withheld on Interest Paid on Deposits
and Yield Deposit Substitute/Trusts/Etc
Form 1603 - Quarterly Remittance of Final Income Taxes
Withheld on Fringe Benefits Paid to Employees
Other than Rank and File
Form 1606 - Monthly Withholding Tax Remittance Return for
Onerous Transfer of Real Property Other than
Capital Asset (including Taxable and Exempt)

CS & TMD
General Course for Revenue Officers WT 230 Slide 161
Monthly Alphalists of Payees (MAP)
(BIR Form Nos. 1600/1601E / 1601F)
10 or less number of employees or payees
Manual submission only three (3) copies of 1600/1601E / 1601F
+ alphalists of payees.
10 or more number of payees
Manual submission three (3) copies of 1600/1601E / 1601F +
alphalist of income payees; and
Diskette Submission ten (10) or more number of employees
or payees who are recipient of income payments subject to
creditable and final withholding tax, are required to submit 3.5
inch floppy disk using any of the following options:
1. Excel Format Provided under Revenue Regulation No. 7 2000 with
technical specification with validation module prescribed by BIR.
2. Own extract program that shall meet the requirements specified in RR
7 2000 with validation module prescribed by BIR.
3. Data Entry Module using Visual Fox Pro.

CS & TMD
General Course for Revenue Officers WT 230 Slide 162
MAP SAWT
1601-E
MAP
(T o be filled up by the B IR)
DLN: PSIC:

Republika ng Pilipinas Monthly Remittance Return BIR Form No.


Kagaw aran ng Pananalapi
of Creditable Income Taxes
Kaw anihan ng Rentas Internas
(Exc ept f or transac tions inv olving onerous t rans fer W ithheld (Expanded) April 2003 (ENCS)
1601-E
of real property class if ied as ordinary
Fill in all applicable spaces. Mark all appropriate box es w ith an X.
1 For the Month 2 Amended Return? 3 No. of Sheets Attac hed 4 Any Tax es Withheld?
(MM / YYYY) Yes No Yes No

WITHHOLDING
Part I Bac k g r o u n d I n f o r m at i o n
5 TIN 6 RDO Code 7 Line of Busines s

8 Withholding Agent's Name (Las t Name, First Name, Middle Name fo r Individuals )/(Regist ered Name for Non-Indiv iduals)
9 Telephone Number

10 Regis tered Address 11 Zip Code


FORMAT
12 Category of Wit hholding Agent 13 Are t here pay ees av ailing of tax relief under special law or international tax t reaty ?

Part I I
Priv ate Gov ernment Yes No If y es, specif y
Com pu tation of Tax
AnnexB
TAX T AX REQUIRED
NATURE OF I NCOME PAYMENT ATC T AX BASE
RATE TO BE WITHHELD

BIRREGISTEREDNAME
TRADENAME
ADDRESS
TIN

AGENTS/ 14 Total Tax Required to be Withheld and Remitted 14


no.

1
1 2
MONTHLYALPHALISTOFWITHHOLDINGTAXES(MAWT)
RETURNPERIOD

Seq TIN RegisteredName


(Alphalist)
3
Return Natureofincome ATC Taxrate Taxbase Tax
period
mm/yy
4
payment
5
6 7 8
Withheld

PAYORS
15 Less: Tax Remitted in Return Previous ly Filed, if this is an amended return 15
16 Tax Still Due/(Overremittance) 16
17 Add: Penalties
17A
Surcharge
17B
Interest
17C
Compromise
17D
3
18 Total Amount Still Due/(Ov erremittance) (Sum of Items 16 & 17D) 18
I declare, under the penalties of perjury, that this return has been made in good f aith, verified by me, and t o the best of my know ledge, and belief ,
4
is true and correct, pursuant to t he provisions of the National Internal Revenue Code, as amended, and the regulat ions issued under authority thereof .
5
19 20
President/Vice President /Authorized Repres ent ative/Tax Agent
(Signature Over Printed Name)
Treasurer/As st. Treasurer/ Authorized Repres entativ e
(Signature Ov er Printed Name)
TOTAL P P
AMOUNT
Title/Posit ion of Signatory Title/ Pos ition of Signatory

TIN of Tax Agent (if applicable) Tax A gent A c c reditat ion N o./D ate o f A c c reditat ion ( if applic able)
Part I II Detail s of Paym ent St amp of Rec eiv ing
Dr aw ee Bank / Date Of f ice and
Par ticul ar s Agency Num ber MM DD YYYY Am ount Date of Rec eipt
21 Cash/Bank 21

1601-F
(T o be filled up by the B IR)

MAP
DLN: PSIC:

Republika ng Pilipinas Monthly Remittance Return BIR Form No.


Kagaw aran ng Pananalapi
of Creditable Income Taxes
Kaw anihan ng Rentas Internas
(Exc ept f or transac tions inv olving onerous t rans fer W ithheld (Expanded) April 2003 (ENCS)
1601-E
of real property class if ied as ordinary
Fill in all applicable spaces. Mark all appropriate box es w ith an X.
1 For the Month 2 Amended Return? 3 No. of Sheets Attac hed 4 Any Tax es Withheld?
(MM / YYYY) Yes No Yes No
Part I Bac k g r o u n d I n f o r m at i o n
5 TIN 6 RDO Code 7 Line of Busines s

8 Withholding Agent's Name (Las t Name, First Name, Middle Name fo r Individuals )/(Regist ered Name for Non-Indiv iduals)
9 Telephone Number

10 Regis tered Address 11 Zip Code


FORMAT
12 Category of Wit hholding Agent 13 Are t here pay ees av ailing of tax relief under special law or international tax t reaty ?
Priv ate Gov ernment Yes No If y es, specif y
Part I I
NATURE OF I NCOME PAYMENT
Com pu tation of Tax
ATC T AX BASE
TAX T AX REQUIRED AnnexB
RATE TO BE WITHHELD

BIRREGISTEREDNAME
TRADENAME
ADDRESS
TIN

MONTHLYALPHALISTOFWITHHOLDINGTAXES(MAWT)
RETURNPERIOD

Seq TIN RegisteredName Return Natureofincome ATC Taxrate Taxbase Tax

BIR
no. (Alphalist) period payment Withheld
3 mm/yy 5
1 2 4 6 7 8 9
14 Total Tax Required to be Withheld and Remitted 14
1
15 Less: Tax Remitted in Return Previous ly Filed, if this is an amended return 15
16 Tax Still Due/(Overremittance) 16 2
17 Add: Penalties Surcharge Interest Compromise
17A 17B 17C
18 Total Amount Still Due/(Ov erremittance) (Sum of Items 16 & 17D)
17D
18 3
I declare, under the penalties of perjury, that this return has been made in good f aith, verified by me, and t o the best of my know ledge, and belief ,
is true and correct, pursuant to t he provisions of the National Internal Revenue Code, as amended, and the regulat ions issued under authority thereof . 4
19 20 5
President/Vice President /Authorized Repres ent ative/Tax Agent Treasurer/As st. Treasurer/ Authorized Repres entativ e
(Signature Over Printed Name) (Signature Ov er Printed Name)
TOTAL P P
Title/Posit ion of Signatory Title/ Pos ition of Signatory AMOUNT
TIN of Tax Agent (if applicable) Tax A gent A c c reditat ion N o./D ate o f A c c reditat ion ( if applic able)
Part I II Detail s of Paym ent St amp of Rec eiv ing
Dr aw ee Bank / Date Of f ice and
Par ticul ar s Agency Num ber MM DD YYYY Am ount Date of Rec eipt
21 Cash/Bank 21

1600
(T o be filled up by the B IR)
DLN:

Republika ng Pilipinas
Kagaw aran ng Pananalapi
Kaw anihan ng Rentas Internas
Monthly Remittance Return
of Creditable Income Taxes
PSIC:

BIR Form No.

1601-E
MAP
(Exc ept f or transac tions inv olving onerous t rans fer W ithheld (Expanded) April 2003 (ENCS)
of real property class if ied as ordinary
Fill in all applicable spaces. Mark all appropriate box es w ith an X.
1 For the Month 2 Amended Return? 3 No. of Sheets Attac hed 4 Any Tax es Withheld?
(MM / YYYY)
Part I
Yes No
Bac k g r o u n d I n f o r m at i o n
Yes No FORMAT
5 TIN 6 RDO Code 7 Line of Busines s

8 Withholding Agent's Name (Las t Name, First Name, Middle Name fo r Individuals )/(Regist ered Name for Non-Indiv iduals)
9 Telephone Number
AnnexB
10 Regis tered Address 11 Zip Code

12 Category of Wit hholding Agent


Priv ate Gov ernment
13 Are t here pay ees av ailing of tax relief under special law or international tax t reaty ?
Yes No If y es, specif y BIRREGISTEREDNAME
Part I I
NATURE OF I NCOME PAYMENT
Com pu tation of Tax
ATC T AX BASE
TAX T AX REQUIRED TRADENAME
RATE TO BE WITHHELD
ADDRESS
TIN

MONTHLYALPHALISTOFWITHHOLDINGTAXES(MAWT)
RETURNPERIOD

Seq TIN RegisteredName Return Natureofincome ATC Taxrate Taxbase Tax


no. (Alphalist) period payment Withheld
3 mm/yy 5
1 2 4 6 7 8 9
1
2
3
14 Total Tax Required to be Withheld and Remitted 14
15 Less: Tax Remitted in Return Previous ly Filed, if this is an amended return 15 4
16 Tax Still Due/(Overremittance) 16
17 Add: Penalties Surcharge Interest Compromise 5
17A 17B 17C 17D
18 Total Amount Still Due/(Ov erremittance) (Sum of Items 16 & 17D) 18 TOTAL P P
I declare, under the penalties of perjury, that this return has been made in good f aith, verified by me, and t o the best of my know ledge, and belief ,
is true and correct, pursuant to t he provisions of the National Internal Revenue Code, as amended, and the regulat ions issued under authority thereof . AMOUNT
19 20
President/Vice President /Authorized Repres ent ative/Tax Agent Treasurer/As st. Treasurer/ Authorized Repres entativ e
(Signature Over Printed Name) (Signature Ov er Printed Name)

Title/Posit ion of Signatory Title/ Pos ition of Signatory

TIN of Tax Agent (if applicable) Tax A gent A c c reditat ion N o./D ate o f A c c reditat ion ( if applic able)
Part I II Detail s of Paym ent St amp of Rec eiv ing
Dr aw ee Bank / Date Of f ice and
Par ticul ar s Agency Num ber MM DD YYYY Am ount Date of Rec eipt
21 Cash/Bank 21

CS & TMD
General Course for Revenue Officers WT 230 Slide 163
MAP SAWT
MAP
FORMAT

Annex B

BIRREGISTEREDNAME
TRADE NAME
ADDRESS
TIN

MONTHLY ALPHALIST OF WITHHOLDINGTAXES (MAWT)


RETURNPERIOD

Seq TIN Registered Name Return Nature of income ATC Tax rate Tax base Tax
no. (Alphalist) period payment Withheld
3 mm/yy 5
1 2 4 6 7 8 9
1
2
3
4
5
TOTAL P P
AMOUNT

ORIGINAL

MAP
FORMAT

Annex B

BIRREGISTEREDNAME
TRADE NAME

BIR
ADDRESS

MANUAL
TIN

MONTHLY ALPHALIST OF WITHHOLDINGTAXES (MAWT)


RETURNPERIOD

Seq TIN Registered Name Return Nature of income ATC Tax rate Tax base Tax
no. (Alphalist) period payment Withheld
3 mm/yy 5
1 2 4 6 7 8 9
1
2

FILERS
3
4
5
TOTAL P P
AMOUNT

DUPLICATE

MAP
FORMAT

Annex B

BIRREGISTEREDNAME
TRADE NAME
ADDRESS
TIN

MONTHLY ALPHALIST OF WITHHOLDINGTAXES (MAWT)


RETURNPERIOD

Seq TIN Registered Name Return Nature of income ATC Tax rate Tax base Tax
no. (Alphalist) period payment Withheld
3 mm/yy 5
1 2 4 6 7 8 9
1
2
3
4
5
TOTAL P P
AMOUNT

TRIPLICATE
TAXPAYER
CS & TMD
General Course for Revenue Officers WT 230 Slide 164
MAP SAWT
1700 DLN:
2316
Republika ng Pilipinas
Kagaw aran ng Pananalapi
K awa ni ha n ng Re ntas In te rna s
Certificate of Comp ensation
BIR Form No.

2316 SAWT
For Compensation P ayment Wit h or Without Tax Wit hheld
Payment/Tax Withh eld Oc tober 2002 (ENCS)
1 For the Y ear 1 2 For the Period
( YYYY ) From (MM/DD) To ( MM/DD)
Par t I Emp lo ye e In for m atio n Par t IVDe t ai ls o f Co mpe ns a t i on Inc o me a nd T a x W i t hhe ld f r om P r e s e nt E mpl oy e r
(To be fill ed up by the B IR) 3 Tax pay er 3 A mount
DLN: PSIC:
Identific ation No. A. Non -T axable/Exem p t Co m pe ns at io n Inco me

Republika ng Pilipinas Monthly Remittance Return BIR Form No.


4 Employee's Name (Last Name, Fir st Name, Middle Name) 5 RDO Code 25 13th Month Pay and
Other Benef its
25
FORMAT
Kagaw aran ng Pananalapi 26 SSS, GSIS, PHIC & Pag-ibig 26
Kaw anihan ng Rentas Inter nas
of Creditable Income Taxes 1601-E 6 Regis tered Address 6A Z ip Code Contr ibutions , & Union dues
( Ex cept f or transactions involv ing onerous tr ans fer Withheld (Expanded) April 2003 ( ENCS)
27 Salaries & Other Forms of
Compens ation
27
of r eal pr oper ty c las s ified as ordinar y
Fill in all applic able s pac es . Mark all appr opriate boxes w ith an X. 6B Loc al Home A ddres s 6C Z ip Code 28 Total Non-Tax able/Exempt
Compens ation Inc ome
28 AnnexB
1 For the Month 2 Amended Return? 3 No. of Sheets Attac hed 4 Any Taxes Withheld?
(MM / YYYY) Yes No Yes No 6D For eign Addres s 6E Zip Code B. T axable Com p en satio n In co m e
Part I Ba ck g r o u n d I n f o rm at i o n
REGUL AR
5 TIN 6 RDO Code 7 Line of Business

8 Withholding Agent's Name (Last Name, F irst Name, Middl e Name for Individuals)/(R egistered Name for No n-Individuals) Telephone Number
7 Date of Birth ( MM/DD/YY YY) 8 Telephone Number 29 Bas ic Salary 29
BIRREGISTEREDNAME
9

10 Regis ter ed Addr es s 11 Z ip Code


9 Exemption Status
Single Head of the Family Married
30 Repres entation 30
TRADENAME
12 Category of Withholding Agent 13 Are there payees av ailing of tax relief under s pec ial law or international tax treaty ?
9A Is the w if e claiming the additional ex emption for qualified dependent c hildren?
Y es No 31 Trans portation 31 ADDRESS
Private Government Yes No If yes, s pecify 10 Name of Qualif ied Dependent Childr en 11 Dat e o f Birt h ( M M /D D/YYYY)

Part II Com put at io n of Tax


32 Cos t of Liv ing A llow anc e 32
TIN
TAX TAX REQUIRED
NATURE OF INCOME PAYMENT AT C TAX BASE RATE TO BE WITHHELD
33 Fix ed Hous ing Allow ance 33
34 Others ( Specify )
12 Other Dependent (to be ac c omplished if tax pay er is head of the family ) 3 4A
Name of Dependent Relationship Dat e o f Birt h
34A
MONTHLYALPHALISTOFWITHHOLDINGTAXES(MAWT)
(M M /DD /YYYY

Par t II Emp lo ye r Info r mation (Pr es en t)


3 4B

SUPPL EM ENTARY
34B
RETURNPERIOD
13 Taxpay er 13 35 Commiss ion 35
Identific ation No.
14 Employ er's Name 36 Profit Sharing 36
37 Fees Inc luding Director 's
Fees
37
Seq TIN RegisteredName Return Natureofincome ATC Taxrate Taxbase Tax
15 Regis tered Addres s 15A Z ip c ode 38 Taxable 13th Month Pay 38
and Other Benefits
39 Haz ard Pay 39 no. (Alphalist) period payment Withheld
Par t III
main employ er s ec ondary employ er
Em ployer In for m atio n (Pr e viou s) -1
40 Others ( Specify )
3 mm/yy 5
16 Taxpay er 16 4 0A 40A
Identific ation No.
17 Employ er's Name 4 0B 40B
1 2 4 6 7 8 9
18 Regis tered Addres s 18A Z ip c ode
41 Total Tax able Compensation 41 1
Inc ome
Su mm ar y

Em ployer In for m atio n (Pr e viou s) -2


42 Taxable Compens ation Income
from Pres ent Employ er
42
2
19 Taxpay er 19 43 Add: Tax able Compens ation 43
Identific ation No.
20 Employ er's Name
f rom Prev ious Employer (s )
44 Gr os s Taxable
Compens ation Inc ome
44 3
21 Regis tered Addres s 21A Z ip c ode
45 Less : Total Ex emptions
46 Less : Pr emium Paid on
Health and/or Hos pital
45

46
4
14 Total Tax Required to be Withheld and Remitted 14
15 Les s: Tax Remitted in Retur n Previously Filed, if this is an amended return
16 Tax Still Due/( Overr emittanc e)
15
16 22 Taxpay er
Em ployer In for m atio n (Pr e viou s) -3
22
Ins uranc e (If applic able)
47 Taxable
Compens ation Inc ome
47 5
17 Add: Penalties
17A
Surc harge
17B
Interest
17C
Compromise
17D
Identification No.
23 Employ er's Name
48 Tax Due
49 Amount of Tax es Withheld
49A Present Employer
48

49A
TOTAL P P
18 Total Amount Still Due/(Overr emittanc e) ( Sum of Items 16 & 17D) 18
I declare, under the penalties of per jur y, that this return has been made in good f aith, verif ied by me, and to the best of my know ledge, and belief,
24 Regis tered Addres s 24A Z ip c ode 49B Prev ious Employer(s ) 49B AMOUNT
50 Total Amount of Tax es 50
is true and corr ec t, pur suant to the pr ov is ions of the National Internal Rev enue Code, as amended, and the r egulations is sued under authority ther eof. Withheld
I declare, under the penalt ies of perjury, that this cer tif icat e has been made in goo d faith, verified by us, and t o the best of o ur knowledge and belief , is tr ue and cor rect
19 20
President/Vice Pr es ident/Authoriz ed Repr es entativ e/Tax Agent Treasurer/Ass t. Treas urer/Author ized Representative
(Signature Ov er Pr inted Name) (Signature Ov er Pr inted Name)

Title/Position of Signatory Title/Pos ition of Signatory

TIN of Tax Agent ( if applic able) Tax Agent Accreditation No./D ate of Accreditatio n (if applicable)
Part III Details of Paym ent Stamp of Rec eiving
Draw ee Bank / Dat e Of fic e and
Particu lars Age ncy Num ber MM DD YYYY Amou nt Date of Receipt
21 Cash/Bank 21

1701/Q 2307/2316 SAWT


FORMAT
(T o be fi lled up by t he BI R)
DLN: PSIC:

Republika ng Pil ipinas Monthly Remittance Return BIR Form No.


AnnexB
Kagaw ar an ng Pananalapi
of Creditable Income Taxes
Kawanihan ng Rentas Internas
(Ex cept for transactions invol ving onerous transfer Withheld (Expanded) April 2003 (ENCS)
1601-E
of real property cl ass ified as ordinary
Fil l in all applicable spaces. Mark all appropriate boxes w ith an X.
1 For the Month 2 Amended Return? 3 No. of Sheets Attached 4 A ny Taxes Withheld? Republika ng Pilipinas
Kaw anihan ng Rentas Internas
Summary List of Creditable Withholding Tax at Source (2307) Received BIRREGISTEREDNAME
(MM / YY YY ) Y es No Yes No Kagaw aran ng Pananalapi
Par t I
5 TIN
Ba c k g r o u n d I n f o r m a t i o n
6 RDO Code 7 Li ne of Bus ines s
For the Period 1
TRADENAME
8 Withholdi ng Agent's Name (Las t Nam e, First Name, M iddle Name f or Indiv iduals )/ (Regis t ered Nam e fo r No n-Indiv iduals ) 9 Telephone Number From
( MM / DD / YYYY )
To
( MM / DD / YYYY ) ADDRESS
Part I P a y e e I n f o r m a t i o n
10 Regis tered A ddress 11 Zip Code
Tax pay er 2 2A Zip 3 Payee's Name (Last N am e, F irst N ame, M iddle Name f or Individuals)(R egistered N ame fo r No n- Individuals) TIN
12 Category of Withholding A gent 13 Are there payees avai ling of tax r elief under special law or inter national tax tr eaty? Identific ation No. Code
Priv ate Gover nment Yes No If yes , speci fy
Par t II Computation of Tax Regis tered A ddres s 4A Foreign
NATURE OF INCOM E PAYM ENT A TC TAX BASE
TAX
RATE
TAX REQUIRED
TO BE WITHHELD A ddres s MONTHLYALPHALISTOFWITHHOLDINGTAXES(MAWT)
Part II Sum mary L ist of Payors
Payor's Name A m o u n t o f In c o m e Pa y m e n t s RETURNPERIOD
Payor's Las t Name, Firs t Name, Middle Name f or Individuals AT C 1st Mo nth 2n d M on th 3rd M onth Tax Withh eld
T IN Regis tered Name for Non-Indiv iduals of the Quarter of th e Quarte r o f the Qu arter T otal Fo r the Quarter

Seq TIN RegisteredName Return Natureofincome ATC Taxrate Taxbase Tax


no. (Alphalist) period payment Withheld
3 mm/yy 5
1 2 4 6 7 8 9
1
2
3
4
14 Total Tax Required to be Withheld and Remitted
15 Less : Tax Remitted in Retur n Prev iously Fil ed, if thi s is an amended return
14
15
5
16 Tax Still Due/(Ov erremittanc e)
17 A dd: Penalties Surcharge Interes t Compr omis e
16
TOTAL P P
17A 17B
18 Total A mount Still Due/(Over remittance) (Sum of Items 16 & 17D)
17C 17D
18 AMOUNT
I declare, under the penalties of perjury, that this r eturn has been made in good fai th, verified by me, and to the best of my knowledge, and beli ef,
is true and correc t, pur suant to the provis ions of the Nati onal Internal Revenue Code, as amended, and the regulations iss ued under authority thereof.

19 20
Pr esident/Vic e Pres ident/A uthor ized Repres entative/Tax A gent Treasurer/Ass t. Treasurer/Authoriz ed Repres entative
( Signature Ov er Printed Name) ( Signature Ov er Printed Name)

Title/Pos ition of Signatory Title/Position of Signatory

TIN of Tax Agent ( if applicable) Tax A gent A c c reditat ion No. /Dat e o f Ac c redit ati on (i f applic able)
T OTAL : P P P P P
Par t III Details of Payment Stamp of Receiv ing
Note: The taxpayer/ filer attest to the accurac y of the information ent ered herein.

PAYEE/
Drawee Bank/ Date Offic e and
Part iculars Agency Number MM DD YYYY Amount Date of Receipt
21 Cas h/Bank 21

1702/Q 2307 SAWT


INCOME (To be f ill ed up by the B IR)
FORMAT

BIR
DLN: PSIC:

Republika ng Pil ipi nas


Kagaw aran ng Pananalapi
Monthly Remittance Return BIR Form No.
Republika ng Pilipinas
Summary List of Creditable Withholding Tax at Source (2307) Received AnnexB
Kaw anihan ng Rentas Inter nas
( Ex cept f or transactions involv ing onerous tr ans fer
of Creditable Income Taxes
W ithheld (Expande d) A pril 2003 ( ENCS)
1601-E Kaw anihan ng Rentas Internas
Kagaw aran ng Pananalapi
of r eal pr oper ty c las s ified as ordinar y
Fill i n all applic able s pac es . Mark all appr opri ate boxes w ith an X.
1 For the Month 2 A mended Return?
For the Period 1
3 No. of Sheets A ttac hed 4 Any Taxes Withheld?

5 TIN
(MM / Y Y YY )
Part I
Y es No
Ba ck g r o u n d I n f o rm at i o n
6 RDO Code 7 Line of Busi ness
Y es No From
( MM / DD / YY YY )
To
( MM / DD / Y Y YY ) BIRREGISTEREDNAME
Part I P a y e e I n f o r m a t i o n
8 Withhol ding A gent's Name (Last Nam e, F irst Nam e, M iddl e Nam e f or I ndividuals)/ (R egist ered Nam e f or No n-Individuals) 9 Telephone Number
Tax pay er 2 2A Zip 3 Payee's Name (Last N am e, F i rs t N am e, M iddle Nam e f or Indi vi dual s )(R egi s tered N am e fo r No n- Indiv i dual s ) TRADENAME
Identific ation No. Code
10 Regis ter ed A ddr es s 11 Z ip Code
ADDRESS

RECIPIENT
12 Category of Wi thholding A gent 13 A re there payees av ailing of tax relief under s pec ial law or internati onal tax treaty ? Regis tered A ddres s 4A Foreign
Part II
Pri vate Government Y es No If yes, s peci fy
Com put at io n of Tax
TAX TAX REQUIRED
A ddres s TIN
NATURE OF INCOM E PAYM ENT AT C TAX BASE RATE TO BE WITHHELD Part II Sum mary L ist of Payors
Payor's Name A m o u n t o f In c o m e Pa y m e n t s
Payor's
T IN
Las t Name, Firs t Name, Middle Name f or Individuals
Regis tered Name for Non-Indiv iduals
AT C 1st Mo nth
of the Quarter
2n d M on th
of th e Quarte r
3rd M onth
o f the Qu arter T otal
Tax Withh eld
Fo r the Quarter MONTHLYALPHALISTOFWITHHOLDINGTAXES(MAWT)
RETURNPERIOD

Seq TIN RegisteredName Return Natureofincome ATC Taxrate Taxbase Tax


no. (Alphalist) period payment Withheld
3 mm/yy 5
1 2 4 6 7 8 9
1
14 Total Tax Required to be Wi thheld and Remitted
15 Les s: Tax Remitted in Retur n Previously Fi led, if this is an amended return
14
15
2
16 Tax Still Due/( Overr emittanc e) 16
17 A dd: Penal ti es
17A
Surc harge
17B
Interest

18 Total A mount Still Due/(Overr emittanc e) ( Sum of Items 16 & 17D)


17C
Compromise
17D
18
3
I declare, under the penalties of per jur y, that this return has been made in good f ai th, verif ied by me, and to the best of my know ledge, and belief,
i s true and corr ec t, pur suant to the pr ov is ions of the National Internal Rev enue Code, as amended, and the r egulations is sued under authority ther eof. 4
19
Presi dent/V ice Pr es ident/Authoriz ed Repr es entativ e/Tax A gent
(Si gnature Ov er Pr inted Name)
20
Treasurer/A ss t. Treas urer/A uthor ized Representative
(S ignature Ov er Pr inted Name)
5
Title/Posi ti on of S ignatory Ti tle/Pos ition of Signatory TOTAL P P
Part III
TIN of Tax A gent ( if applic able)
Details of Paym ent
Tax Agent Accredit at ion No. /D ate of Accredit at io n (if applicable)
Stamp of Rec ei ving
AMOUNT
Draw ee Bank / Dat e Of fic e and
Particu lars Age ncy Num ber MM DD YY YY Amou nt Date of Receipt
21 Cash/Bank 21

T OTAL : P P P P P
Note: The taxpayer/ filer attest to the accurac y of the information ent ered herein.

2550M/Q
2551M/2553
2307 FORMAT
SAWT
(T o be fil led up by the B IR)
DLN: PSIC:
Republika ng Pilipinas
Summary List of Creditable Withholding Tax at Source (2307) Received
Republika ng Pilipinas
Kagaw aran ng Pananalapi
Monthly Remittance Return BIR Form No. Kaw anihan ng Rentas Internas
Kagaw aran ng Pananalapi AnnexB
Kaw anihan ng Rentas Int ernas
of Creditable Income Taxes
(Ex cept f or transact ions inv olving onerous transf er W ithheld (Expanded)
1601-E
April 2003 (ENCS)
For the Period 1
of real property clas sif ied as ordinary From To
Fill in all applicable s pac es . Mark all appropriate boxes w ith an X. ( MM / DD / YY YY ) ( MM / DD / Y Y YY )
1 For the Month
(MM / Y Y Y Y )
2 A mended Return?
Y es No
3 No. of Sheets A t tac hed 4 Any Tax es Withheld?
Y es No
Part I P a y e e I n f o r m a t i o n BIRREGISTEREDNAME
Tax pay er 2 2A Zip 3 Payee's Name (Last N am e, F i rs t N am e, M iddle Nam e f or Indi vi dual s )(R egi s tered N am e fo r No n- Indiv i dual s )
Par t I
5 TIN
Ba c k g r o u n d
6
Inf or m a t io n
RDO Code 7 Line of Bus iness Identific ation No. Code TRADENAME
8 Wit hholding A gent's Name
ADDRESS
( Las t Nam e, Fi rs t Nam e, M i ddl e Nam e for Indiv i duals )/( Regi stered Nam e fo r N on-Indiv i duals ) 9 Telephone Number
Regis tered A ddres s 4A Foreign
10 Regist ered A ddres s 11 Zip Code A ddres s

12 Category of Withholding A gent 13 A re there pay ees availing of tax relief under special law or international tax treaty?
Part II Sum mary L ist of Payors TIN
Priv at e Gov ernment Y es No If yes , s pecif y
Payor's Name A m o u n t o f In c o m e Pa y m e n t s
Par t II Com pu tation of Tax Payor's Las t Name, Firs t Name, Middle Name f or Individuals AT C
TAX TAX REQUIRED
1st Mo nth 2n d M on th 3rd M onth Tax Withh eld
NATURE OF I NCOME PAYMENT ATC TAX BASE T IN Regis tered Name for Non-Indiv iduals of the Quarter of th e Quarte r o f the Qu arter T otal Fo r the Quarter
RATE TO BE WITHHELD
MONTHLYALPHALISTOFWITHHOLDINGTAXES(MAWT)
RETURNPERIOD

Seq TIN RegisteredName Return Natureofincome ATC Taxrate Taxbase Tax


no. (Alphalist) period payment Withheld
3 mm/yy 5
1 2 4 6 7 8 9
1
2
3
14 Tot al Tax Required to be Withheld and Remitt ed
15 Les s: Tax Remitted in Return Prev ious ly Filed, if this is an amended return
14
15 4
16 Tax St ill Due/ (Ov erremittanc e) 16
17 A dd: Penalties
17A
S urcharge
17B
Interest
17C
Compromis e
17D
5
18 Tot al A mount St ill Due/ (Ov erremittanc e) (Sum of Items 16 & 17D) 18
I dec lare, under t he penalties of perjury, that this ret urn has been made in good f ait h, verif ied by me, and to the best of my know ledge, and belief ,
is true and correct, pursuant to the provisions of the National Internal Revenue Code, as amended, and the regulations iss ued under authorit y t hereof .
TOTAL P P
19 20 AMOUNT
President/V ice Pres ident/A ut horized Representativ e/ Tax A gent Treas urer/A ss t. Treasurer/A ut horized Representativ e
(Signature Ov er Printed Name) (Signat ure Over Printed Name)

Title/Pos ition of S ignat ory Title/Pos ition of Signat ory

T OTAL : P P P P P
TIN of Tax A gent (if applic able) Tax A gent A cc reditati on N o./ Date of A c c redi tatio n (i f appl ic abl e) Note: The taxpayer/ filer attest to the accurac y of the information ent ered herein.

CS & TMD
Par t III Detail s of P aym ent Stamp of Rec eiving
Draw ee Ban k/ Date Of f ice and
Particulars Agency Num ber MM DD YYYY Am ount Date of Receipt
21 Cash/Bank 21

General Course for Revenue Officers WT 230 Slide 165


MAP SAWT
SAWT
FORMAT

Annex B

BIRREGISTEREDNAME
TRADE NAME
ADDRESS
TIN

MONTHLY ALPHALIST OF WITHHOLDINGTAXES (MAWT)


RETURNPERIOD

Seq TIN Registered Name Return Nature of income ATC Tax rate Tax base Tax
no. (Alphalist) period payment Withheld
3 mm/yy 5
1 2 4 6 7 8 9
1
2
3
4
5
TOTAL P P
AMOUNT

ORIGINAL

SAWT
FORMAT

BIR
Annex B

BIRREGISTEREDNAME
TRADE NAME
ADDRESS
TIN

MANUAL
MONTHLY ALPHALIST OF WITHHOLDINGTAXES (MAWT)
RETURNPERIOD

Seq TIN Registered Name Return Nature of income ATC Tax rate Tax base Tax
no. (Alphalist) period payment Withheld
3 mm/yy 5
1 2 4 6 7 8 9
1
2
3

FILERS
4
5
TOTAL P P
AMOUNT

DUPLICATE
SAWT
FORMAT

Annex B

BIRREGISTEREDNAME
TRADE NAME
ADDRESS
TIN

MONTHLY ALPHALIST OF WITHHOLDINGTAXES (MAWT)


RETURNPERIOD

Seq TIN Registered Name Return Nature of income ATC Tax rate Tax base Tax
no. (Alphalist) period payment Withheld
3 mm/yy 5
1 2 4 6 7 8 9
1
2
3
4
5
TOTAL P P
AMOUNT

TRIPLICATE TAXPAYER
CS & TMD
General Course for Revenue Officers WT 230 Slide 166
Withholding Tax Returns (cont.)

B. Annual Returns
Form 1604 CF - Annual Information Return of Income Taxes
Withheld on Compensation and Final
Withholding Taxes
(with Alphalists of Employees and/or
payees)

Form 1604 E - Annual Information Return of Creditable


Income Taxes Withheld
(with Alphalists of Payees)

CS & TMD
General Course for Revenue Officers WT 230 Slide 167
Annual Information Return (BIR Form 1604CF / 1604-E) Including
the Alphabetical List of Employees and Income Recipient

10 or less number of employees or payees


Manual submission only three (3) copies of 1604CF / 1604E
+ alphalist of employees and income payees.
10 or more number of employees or payees
Manual submission three (3) copies of 1604CF / 1604E +
alphalist of employees and income payees; and
Diskette Submission ten (10) or more number of employees
or payees who are recipient of income payments subject to
creditable and final withholding tax, are required to submit 3.5
inch floppy disk using any of the following options:
1. Excel Format Provided under Revenue Regulation No. 7 2000 with
technical specification with validation module prescribed by BIR.
2. Own extract program that shall meet the requirements specified in RR
7 2000 with validation module prescribed by BIR.
3. Data Entry Module using Visual Fox Pro.

CS & TMD
General Course for Revenue Officers WT 230 Slide 168
Annual Information Return (BIR Form 1604CF / 1604-E) Including
the Alphabetical List of Employees and Income Recipient

 What to use 1604CF + alphalist 1604 E + alphalist

 When to submit on or before Jan. 31 on or before March1


of the following year of the following year

 Where to submit RDO RDO


LTDO LTDO
LTAD LTAD

 Retention 3 years in a secondary 3 years in a secondary


storage (diskette) storage (diskette)

CS & TMD
General Course for Revenue Officers WT 230 Slide 169
Withholding Tax Returns (cont.)

C. Certificates
Form 2304 - Certificate of Income Payment not Subject to
Withholding Tax (Excluding Compensation
Income)
Form 2305 - Certificate of Update of Exemption and of
Employers and Employees Information
Form 2306 - Certificate of Final Tax Withheld at Source
Form 2307 - Certificate of Creditable Tax Withheld at
Source
Form 2316 - Employers Certificate of Compensation
Payment/Tax Withheld (for Compensation
Payment With or Without Tax Withheld)

CS & TMD
General Course for Revenue Officers WT 230 Slide 170
GOVERNMENT EXPENSE CHART
(Effective November 1, 2005)
GOOD EWT GMP TOTAL
SERVICES BIR CREDITABLE FINAL VAT NON-VAT %
EXPENSE / INCOME PAYMENTS VAT PERCENTAGE
FORMS
1601-E BIR Form No. 1600

MAINTENANCE AND OPERATING EXPENSES


Communications Services (PLDT, Smart, etc.) Service 2% NONE 5% 3% 7% or 5%
Repairs and Maintenance of Government Service 2% NONE 5% 3% 7% or 5%
Facilities Goods 1% NONE 5% 3% 6% or 4%
Repairs and Maintenance of Government Service 2% NONE 5% 3% 7% or 5%
Vehicles Goods 1% NONE 5% 3% 6% or 4%
Transport of Goods, Merchandise, Cargo Service
Domestic- air, sea and land (within the Phils.) 2% 5% 3% 7% or 5%
NONE
Domestic- air, sea and land (Phils. To foreign country) Service 2% NONE NONE NONE 2%
International Air & Sea Carriers (Phils. To foreign) Service 2% NONE NONE 3% 5%
Transport of Passengers Service
2% NONE 7%
NONE 5%
Domestic- land (within the Phils.) 2% NONE NONE 3% 5%
International - air & sea (Phils. To foreign) 2% NONE NONE 3% 5%
Supplies and materials, including equipment Goods 1% NONE 5% 3% 6% or 4%

CS & TMD
General Course for Revenue Officers WT 230 Slide 171
GOVERNMENT EXPENSE CHART
(Effective November 1, 2005)
GOOD EWT GMP TOTAL
SERVICES BIR CREDITABLE FINAL VAT NON-VAT %
EXPENSE / INCOME PAYMENTS VAT PERCENTAGE
FORMS
1601-E BIR Form No. 1600

MAINTENANCE AND OPERATING EXPENSES


RENTAL (see NOTE no. 2)
1. Real Property Service 5% NONE 5% 3% 10% or 8%
2. Cinematographic Films Service 5% NONE 5% 3% 10% or 8%
3. Personal Property Service 5% NONE 5% 3% 10% or 8%
Payment for :
1. Use or Lease of property rights to non-resident Service NONE NONE 12% NONE 12%
owners
2. Services rendered by local insurance companies Service NONE 12% NONE 12%
NONE
with respect to reinsurance premiums payable to
non-residents
3. Other services rendered in the Phils. By non- Service NONE NONE 12% NONE 12%
residents

MANILA WATER CO., INC. (MWCI)


Income Tax Holiday up to December 31, 2006
Starting January 1, 2007 Service 2% NONE 5% NONE 7%
MAYNILAD WATER SERVICE, INC. (MWSI)
Income Tax Holiday up to August 2007
Starting September 1, 2007 Service 2% NONE 5% NONE 7%
POWER (MERALCO) Service 2% NONE 5% NONE 7%
OTHER WATER UTILITIES Service 2% NONE 5% 2% 7% or 4%

CS & TMD
General Course for Revenue Officers WT 230 Slide 172
GOVERNMENT EXPENSE CHART
(Effective November 1, 2005)
GOOD EWT GMP TOTAL
SERVICES BIR CREDITABLE FINAL VAT NON-VAT %
EXPENSE / INCOME PAYMENTS VAT PERCENTAGE
FORMS
1601-E BIR Form No. 1600

MAINTENANCE AND OPERATING EXPENSES


PAYMENT TO COOPERATIVES:
A. 1. With BIR issued exemption certificate Service NONE NONE NONE NONE NONE
2. Without BIR issued exemption certificate 2% NONE 5% NONE 7%

B. 1. With BIR issued exemption certificate Goods NONE NONE NONE NONE NONE
2. Without BIR issued exemption certificate 1% NONE 5% NONE 6%
C. Electric Cooperative (Power distribution)
1. Registered with NEA
Service NONE NONE 5% NONE 5%
2. Registered with CDA
a. Do not transact with non-members Service NONE NONE 5% NONE 5%
b. Transacting with members & non-members Service
b1. With members Service NONE NONE 5% NONE 5%
b2. With non-members and have an
accumulated reserve and undivided net
savings of not more than P10M Service NONE NONE 5% NONE 5%
b3. With non-members and have an
accumulated reserve and undivided net
savings of more than P10M
- with conditions under RMC 72-2003
Service NONE NONE 5% NONE 5%

CS & TMD
General Course for Revenue Officers WT 230 Slide 173
GOVERNMENT EXPENSE CHART
(Effective November 1, 2005)
GOOD EWT GMP TOTAL
SERVICES BIR CREDITABLE FINAL VAT NON-VAT %
EXPENSE / INCOME PAYMENTS VAT PERCENTAGE
FORMS
1601-E BIR Form No. 1600

MAINTENANCE AND OPERATING EXPENSES


TRAININGS AND SEMINARS Service 2% NONE 5% 3% 7% or 5%
Purchase of GASOLINE Goods 1% NONE 5% 3% 6% or 4%
Other petroleum products (wax, grease, etc.) Goods 1% NONE 5% 3% 6% or 4%
SERVICES rendered by gasoline stations Service 2% NONE 5% 3% 7% or 5%
PAYMENT OF INSURANCE PREMIUMS Service
Non-Life 2% NONE 5% 3% 7% or 5%
Life
2% NONE NONE 5% 7%
LIBRARY BOOKS Goods 1% NONE NONE NONE 1%
OTHER LIBRARY MATERIALS Goods 1% NONE 5% 3% 6% or 4%
SERVICES Service 2% NONE 5% 3% 7% or 5%
Security, Janitorial, Maintenance of aircon,
computers, elevators, etc.
Professional Services rendered by General Service NONE NONE 5% 3% 5% or 3%
Professional Partnership (GPP)

CS & TMD
General Course for Revenue Officers WT 230 Slide 174
GOVERNMENT EXPENSE CHART
(Effective November 1, 2005)
GOOD EWT GMP TOTAL
SERVICES BIR CREDITABLE FINAL NON-VAT %
EXPENSE / INCOME PAYMENTS VAT VAT PERCENTAGE
FORMS
1601-E BIR Form No. 1600

MAINTENANCE AND OPERATING EXPENSES

Professional fee paid to taxable juridical Service 10% or 15% NONE 5% 3% 15% or 13% &
20% or 18%
person
Services rendered by persons engaged in the practice of
Profession or callings Service 10% or 15% NONE 5% 3% 15% or 13% &
20% or 18%
Services rendered by actors, actresses, talents, singers,
emcees, prof. athletes, radio and television broadcasters Service 10% or 15% NONE 5% 3% 15% or 13% &
and choreographers, musical, radio, television and stage 20% or 18%
directors
Services by other professionals, talents, etc. under RR Service 10% or 15% NONE 5% 3% 15% or 13%
No. 17-2003 as amended by RR No. 30-2003 (see note 20% or 18%
No. 5)
Purchase of Other Goods Goods 1% NONE 5% 3% 6% or 4%
Purchase of other services other than those covered Service 2% NONE 5% 3% 7% or 5%
by other rates of withholding tax (RR No. 17 2003)

Purchase of Agriculture Products (see note Goods 1% NONE NONE NONE 1%


no. 7)

CS & TMD
General Course for Revenue Officers WT 230 Slide 175
GOVERNMENT EXPENSE CHART
(Effective November 1, 2005)
GOOD EWT GMP TOTAL
SERVICES BIR CREDITABLE FINAL VAT NON-VAT %
EXPENSE / INCOME PAYMENTS VAT PERCENTAGE
FORMS
1601-E BIR Form No. 1600

Commissions received by customs, real estate, stock, Service 10% NONE 5% 3% 15% or
Immigration and commercial brokers 13%

CAPITAL OUTLAY
PURCHASE OF LAND considered as ordinary 1.5%, 3%, NONE 5% 3% 6.5%, 8%,
asset 5% or 6% 10%, 11%
or
4.5%, 6%,
8%, 9%
Land improvement outlay Goods 1% NONE 5% 3% 6% or 4%
Service 2% NONE 5% 3% 7% or 5%
Buildings and Improvements Outlay
Straight Contract (Labor and Materials) Service 2% NONE 5% 3% 7% or 5%
Separate Invoice/Billing for Materials Goods 1% NONE 5% 3% 6% or 4%
Separate Invoice/Billing for Labor Service 2% NONE 5% 3% 7% or 5%
Furniture, Fixtures, Equipment Outlay Goods 1% NONE 5% 3% 6% or 4%
Information Technology (IT) Equipment Outlay Goods 1% NONE 5% 3% 6% or 4%
Service 2% NONE 5% 3% 7% or 5%

CS & TMD
General Course for Revenue Officers WT 230 Slide 176
GOVERNMENT EXPENSE CHART
(Effective November 1, 2005)
GOOD EWT GMP TOTAL
SERVICES BIR CREDITABLE FINAL VAT NON-VAT %
EXPENSE / INCOME PAYMENTS VAT PERCENTAGE
FORMS
1601-E BIR Form No. 1600

CAPITAL OUTLAY
Lump-Sum for Capital Outlay 2% NONE 5% 3% 7% or 5%

Franchise Tax on Radio and TV Broadcasting Service 2% NONE NONE 3% 5%


companies whose annual gross receipts do not
exceed P10M and who are not VAT-registered
taxpayer

Business Tax on Agents of Foreign Insurance Co. Service 2% NONE NONE 10% 12%
Insurance Agents

Business Tax on Agents of Foreign Insurance Co.- Service 2% NONE NONE 5% 7%


owner of the property

Tax on Cockpits Service 2% NONE NONE 18% 20%


Tax on Cabaret, night and day clubs Service 2% NONE NONE 18% 20%

Tax on Boxing exhibitions Service 2% NONE NONE 10% 12%

Tax on Professional basketball games Service 2% NONE NONE 15% 17%

CS & TMD
General Course for Revenue Officers WT 230 Slide 177
GOVERNMENT EXPENSE CHART
(Effective November 1, 2005)
GOOD EWT GMP TOTAL
SERVICES BIR CREDITABLE FINAL VAT NON-VAT %
EXPENSE / INCOME PAYMENTS VAT PERCENTAGE
FORMS
1601-E BIR Form No. 1600

CAPITAL OUTLAY
Tax on Jai-Alai and race tracks Service 2% NONE NONE 30% 32%
Tax on sale, barter or exchange of stocks listed and Service 2% NONE NONE 1 1/2% or 1% 11%
traded through Local Stock Exchange
Tax on shares of stock sold or exchanged through
initial and secondary public offering
- Not over 25% Service 2% NONE NONE 4% 6%
- Over 25% but not exceeding 33 1/3 % Service 2% NONE NONE 2% 4%
- Over 33 1/3 % Service 2% NONE NONE 1% 3%
Tax on interest, commissions and discounts from
lending activities as well as income from financial
leasing, on the basis of remaining maturities of
instrument from which such receipts are derived: (see
Note no. 3)
- Maturity period is five years or less Service 2% NONE NONE 5% 7%
- maturity period is more than five years Service 2% NONE NONE 1% 3%

Tax on dividends and equity shares and net income


NONE NONE NONE 0% 0%
of subsidiaries

CS & TMD
General Course for Revenue Officers WT 230 Slide 178
GOVERNMENT EXPENSE CHART
(Effective November 1, 2005)
GOOD EWT GMP TOTAL
SERVICES BIR CREDITABLE FINAL VAT NON-VAT %
EXPENSE / INCOME PAYMENTS VAT PERCENTAGE
FORMS
1601-E BIR Form No. 1600

CAPITAL OUTLAY
Tax on royalties, rentals of property, real or personal,
profits from exchange and all other items treated as
gross income under Section 32 of the Tax Code.
Tax on:
- Royalties 7%
Service NONE NONE NONE 7%
- Rental of Property
Service 5% NONE NONE 7% 12%
- Profits for exchange and all other items
Service NONE NONE NONE 7%
treated as gross income under Section 32 of 7%
the Tax Code

Tax on the net trading gains within the taxable year 7%


NONE NONE NONE 7%
on foreign currency, debt securities, derivatives, and
other similar financial instruments
(see Note no. 4)

CS & TMD
General Course for Revenue Officers WT 230 Slide 179
GOVERNMENT EXPENSE CHART
(Effective November 1, 2005)
GOOD EWT GMP TOTAL
SERVICES BIR CREDITABLE FINAL VAT NON-VAT %
EXPENSE / INCOME PAYMENTS VAT PERCENTAGE
FORMS
1601-E BIR Form No. 1600

CAPITAL OUTLAY

Tax on interest, commissions and discounts from


lending activities as well as income from financial
leasing, on the basis of remaining maturities of
instrument from which such receipts are derived:

- Maturity period is five years or less Service 2% NONE NONE 5% 7%


- maturity period is more than five years Service 2% NONE NONE 1% 3%

On all other items treated as gross income under the Depends Depends 5% Depends Depends
code: Rate depends of transaction

CS & TMD
General Course for Revenue Officers WT 230 Slide 180
GOVERNMENT EXPENSE CHART
(Effective November 1, 2005)
NOTE :

1. For casual or single purchase of goods and services worth P10,000.00 and below under
Section 3(N) of RR No. 17-2003 NOT SUBJECT TO EWT.

2. For rental of personal properties in excess of P10,000.00 annually except those under
financial lease arrangement with leasing and finance companies under R.A. No. 8556
(Financing Company Act of 1998) under Section 3(C)(2) of RR No. 17-2003 5% EWT

3. Please refer to Section 121 of RA 8424 as amended by RA 9337.

4. For purchases of goods and services subject to FINAL VAT please refer to Section
4.114-2 of RR No. 16-2005.

5. 15% EWT if the payees current years income exceeds P 720,000.00 and 10% if other
wise pursuant to RR No. 30-2003

6. For Final WT, please refer to transactions under Section 2.57.1 of RR No. 2-98.

7. Please refer to Revenue Memorandum Circular Nos. 44-2007 and 45-2007 (RMC 44-2007/45-
2007) in relation to Section 4,109.1 of RR 16-2005 as regards agricultural products in their
original state

Date Revised: July, 2007


CS & TMD
General Course for Revenue Officers WT 230 Slide 181
Revised Withholding Tax Tables
Effective January 1, 2009
DAILY 1 2 3 4 5 6 7 8
Exemption 0.00 0.00 1.65 8.25 28.05 74.26 165.02 412.54
Status ('000P) +0% +5% +10% +15% +20% +25% +35% +32%
over over over over over over over over
A. Table for employees without qualified dependent
1. Z 0.0 1 0 33 99 231 462 825 1,650
2. S/ME 50.0 1 165 198 264 396 627 990 1,815
B. Table for single/married employee with qualified dependent child(ren)
1. ME1 / S1 75.0 1 248 281 347 479 710 1,073 1,898
2. ME2 / S2 100.0 1 330 363 429 561 792 1,155 1,980
3. ME3 / S3 125.0 1 413 446 512 644 875 1,238 2,063
4. ME4 / S4 150.0 1 495 528 594 726 957 1,320 2,145
Legend:
Z - Zero exemption
S-Single
ME-Married Employee

CS & TMD
General Course for Revenue Officers WT 230 Slide 182
Revised Withholding Tax Tables
Effective January 1, 2009
WEEKLY 1 2 3 4 5 6 7 8
Exemption 0.00 0.00 9.62 48.08 163.46 432.69 961.54 2,403.85
Status +0% +5% +10% +15% +20% +25% +35% +32%
over over over over over over over over
A. Table for employees without qualified dependent
1. Z 0.0 1 0 192 577 1,346 2,692 4,808 1,650
2. S/ME 50.0 1 962 1,154 1,538 2,308 3,654 5,769 1,815
B. Table for single/married employee with qualified dependent child(ren)
1. ME1 / S1 75.0 1 1,442 1,635 2,019 2,788 4,135 6,250 11,058
2. ME2 / S2 100.0 1 1,923 2,115 2,500 3,269 4,615 6,731 11,538
3. ME3 / S3 125.0 1 2,404 2,596 2,981 3,750 5,096 7,212 12,019
4. ME4 / S4 150.0 1 2,885 3,077 3,462 4,231 5,577 7,692 12,500
Legend:
Z - Zero exemption
S-Single
ME-Married Employee

CS & TMD
General Course for Revenue Officers WT 230 Slide 183
Revised Withholding Tax Tables
Effective January 1, 2009

SEMI-MONTHLY 1 2 3 4 5 6 7 8
Exemption 0.00 0.00 20.83 104.17 354.17 937.50 2,083.33 5,208.33
Status +0% +5% +10% +15% +20% +25% +35% +32%
over over over over over over over over
A. Table for employees without qualified dependent
1. Z 0.0 1 0 417 1,250 2,917 5,833 10,417 20,833
2. S/ME 50.0 1 2,083 2,500 3,333 5,000 7,917 12,500 22,917
B. Table for single/married employee with qualified dependent child(ren)
1. ME1 / S1 75.0 1 3,125 3,542 4,375 6,042 8,958 13,542 23,958
2. ME2 / S2 100.0 1 4,167 4,583 5,417 7,083 10,000 14,583 25,000
3. ME3 / S3 125.0 1 5,208 5,625 6,458 8,125 11,042 15,625 26,042
4. ME4 / S4 150.0 1 6,250 6,667 7,500 9,167 12,083 16,667 27,083
Legend:
Z - Zero exemption
S-Single
ME-Married Employee

CS & TMD
General Course for Revenue Officers WT 230 Slide 184
Revised Withholding Tax Tables
Effective January 1, 2009

MONTHLY 1 2 3 4 5 6 7 8
Exemption 0.00 0.00 41.67 208.33 708.33 1,875.00 4,166.67 10,416.67
Status +0% +5% +10% +15% +20% +25% +35% +32%
over over over over over over over over
A. Table for employees without qualified dependent
1. Z 0.0 1 0 833 2,500 5,833 11,667 20,833 41,667
2. S/ME 50.0 1 4,167 5,000 6,667 10,000 15,833 25,000 45,833
B. Table for single/married employee with qualified dependent child(ren)
1. ME1 / S1 75.0 1 6,250 7,083 8,750 12,083 17,917 27,083 47,917
2. ME2 / S2 100.0 1 8,333 9,167 10,833 14,167 20,000 29,167 50,000
3. ME3 / S3 125.0 1 10,417 11,250 12,917 16,250 22,083 31,250 52,083
4. ME4 / S4 150.0 1 12,500 13,333 15,000 18,333 24,167 33,333 54,167
Legend:
Z - Zero exemption
S-Single
ME-Married Employee

CS & TMD
General Course for Revenue Officers WT 230 Slide 185
INTEGRITY
The following are grave offenses with their corresponding penalties:

a) Dishonesty (1st Offense, Dismissal) ;


b) Gross neglect of duty (1st Offense, Dismissal) ;
c) Grave misconduct (1st Offense, Dismissal) ;
d) Falsification of official document (1st Offense, Dismissal) ;
e) Oppression (1st Offense, suspension for six months and one day
to one year; 2nd Offense, Dismissal) ; and
f) Inefficiency and incompetence in the performance of official duties
(1st Offense, Suspension for six months and one day to one year;
2nd Offense, Dismissal).

CS & TMD
General Course for Revenue Officers WT 230 Slide 186