Bir and enterprise

Special ReportBy: Karla A. Milan

Entrepreneur Class – Prof. Saguinsin

TAXATION Defined

Is the process or act of imposing a charge by governmental authority on property, individuals or transactions to raise money for public purposes.

A symbolic relationship whereby in exchange for the protection that the citizens get from the government, taxes are paid.

Application for Taxpayer Identification Number

DESCRIPTION

Any person, whether natural or juridical, required under the authority of the Internal Revenue Code to make, render or file a return, statement or other documents, shall be supplied with or assigned a Taxpayer Identification Number (TIN) to be indicated in the return, statement or document to be filed with the Bureau of Internal Revenue, for his proper identification for tax purposes (Sec. 236 (j) of the Tax Code).

Application for Taxpayer Identification Number

Deadline- All individuals engaged in trade or business shall accomplish and file the application before the commencement of their business operation.

Get your Taxpayer Identification Number online!

https://ereg.bir.gov.ph/ereg/welcome.do

https://ereg.bir.gov.ph/ereg/welcome.do

Monthly Filing of BIR Remittances2. Monthly Remittance Return of Income

Taxes Withheld on Compensation This return is filed by every Withholding

Agent (WA)/payor who is either an individual or non-individual, required to deduct and withhold taxes on compensation paid to employees.

BIR Form No. 1601C Deadline: every 10th day of the

succeeding month.

Monthly Filing of BIR Remittances

Example:Employee 1 has a basic salary of Php 8,000.Basic Salary ---------------------- Php 8,000Less: SSS -------------------------- 1,500Philhealth ------------------------ 500Mutual Fund -------------------- 100Tax --------------------------------- 1,000Net Pay Php 5,900


2. Monthly Remittance Return of Creditable Income Taxes Withheld (Expanded)

This return is filed by every Withholding Agent (WA)/payor who is either an individual or non-individual, required to deduct and withhold taxes on income payments subject to Expanded / Creditable Withholding Taxes.

BIR Form No. 1601E Deadline: every 10th day of the succeeding month.


Example:ABC Company has a monthly rental of

Php10,000. Rentals of real properties are subject to 5% Expanded Withholding Tax is computed as:Php 10,000 x 5% = Php 500

Monthly Filing of BIR Remittances3A. Monthly Percentage Tax Return Persons whose gross annual sales and/

or receipt do not exceed P1,500,000 and who are not VAT-registered persons.

BIR Form No. 2551M Deadline: every 20th day of the

succeeding month.


Example:ABC Company earned Php 100,000 monthly

gross sales. Percentage Tax is: 100,000 x 3% Php 3,000


3B. Monthly Value-Added Tax Declaration A VAT-registered person BIR Form No. 2550M Deadline: every 20th day of the succeeding month


Example:ABC Company earned Php 100,000 gross sales

and incurred Php 80,000 purchases. Output Tax: Php 100,000 x 12% = Php 12,000 Input Tax: Php 80,000 x 12% = 9,600 VAT Payable = Php

2,400

Penalties

25% Surchage – failure to file and pay the return.

50% Surcharge – falsity or fraud on remittances.

20% Interest per annum Compromise Penalty: Individual – Php 250Partnership – Php 750Corporation – Php 1000

BIR Audit Process for Assessment

BIR Audit Process for Assessment

Education

Bir and enterprise