Tax Reform and Rates under TRAIN Law

PRESENTED BY:
MARIVIC A.GALBAN
OIC-HEAD REVENUE EXECUTIVE ASSISTANT
HUMAN RESOURCE MANAGEMENT SERVICE
BUREAU OF INTERNAL REVENUE, DILIMAN, QUEZON CITY
1
GACPA CONVENTION – WATERFRONT CEBU CITY MAY 25, 2018
BY: MARIVIC A. GALBAN
How to achieve the vision
Ways to raise additional Complementary economic
investments reforms
Sustainable Budget Secure Enhance

borrowings property competition
reforms
rights
Tax & Tax policy Improve

customs food Simplify
administration reform regulations
security
reform
BY: MARIVIC A. GALBAN GACPA CONVENTION – WATERFRONT CEBU CITY MAY 25, 2018
2
Why tax policy reform is
needed: A deficient tax system
CAUSE EFFECT OUTCOME

Inflation High tax Inequity
rates
Special
treatment
and Complexity
Narrow tax
exemptions base
Lack of (only about Inefficiency
informatio half of the
n (e.g., bank economy is
secrecy) taxed)
3
In summary, tax reform is needed to
fund the ten-point socioeconomic agenda
BY: MARIVIC A. GALBAN GACPA

G ACPA C
CONVENTION
ONVENTION – W
WATERFRONT
ATERFRONT CEBU
CEBU CITY
CITY MAY
MAY 25, 20418
25 2018
It is crucial for the success of the
“golden age of infrastructure”.
5
6
What is the purpose
of TRAIN?
The purpose of TRAIN is to make our
country’s tax system
SECTION 3. A. INCOME TAX RATES
ON INDIVIDUAL CITIZEN AND INDIVIDUAL RESIDENT ALIEN
Effective January 1, 2018 until December 31, 2022:
In general, the income tax on the individual’s taxable income shall be
computed based on the following schedules as provided under Sec. 24(A)(2)(a)
RANGE OF TAXABLE INCOME TAX DUE = a + (b x c)
BASIC AMOUNT ADDITIONAL OF EXCESS OVER
RANGE OF TAXABLE INCOME (a) TAX DUE
RATE= a + (b x c) (c)
OVER NOT OVER
(b)
BASIC ADDITIONAL OF OVER
OVER NOT OVER
(a) (b) (c)
- - -
- 250,000
250,000.00 - -
250,000.00
250,000 400,000.00
400,000 -- 20%
20% 250,000.00
250,000
400,000.00 800,000.00 30,000.00 25% 400,000.00
400,000 800,000 30,000 25% 400,000
800,000.00 2,000,000.00 130,000.00 30% 800,000.00
800,000
2,000,000.00 2,000,000
8,000,000.00 130,000
490,000.00 30%
32% 800,000
2,000,000.00
8,000,000.00 - 2,410,000.00 35% 8,000,000.00
2,000,000 8,000,000 490,000 32% 2,000,000
8,000,000 - 2,410,000 35% 8,000,000
11
SECTION 3. INCOME TAX RATES
ON INDIVIDUAL CITIZEN AND INDIVIDUAL RESIDENT ALIEN
Effective January 1, 2023 and onwards:
RANGE OF TAXABLE INCOME TAX DUE = a + (b x c)
BASIC AMOUNT ADDITIONAL OF EXCESS OVER

(a) RATE (c)
OVER NOT OVER
(b)
- - -
250,000
250,000 400,000 - 250,000
15%
400,000 800,000 22,500 400,000
20%
800,000 2,000,000 102,500 800,000
25%
2,000,000 8,000,000 402,500 2,000,000
30%
8,000,000 - 2,202,500 8,000,000
35%
12
SECTION 3. INCOME TAX RATES ON INDIVIDUAL CITIZEN
AND INDIVIDUAL RESIDENT ALIEN
In general, the income tax on the individual’s taxable income shall be
computed based on the following schedules as provided under Sec. 24(A)(2)(a)
Effective January 1, 2018 until December 31, 2022: Effective January 1, 2023 and onwards
RANGE OF TAX DUE = a + (b x c) RANGE OF TAX DUE = a + (b x c)
TAXABLE TAXABLE INCOME
INCOME BASIC ADDITION OF EXCESS
BASIC ADDITION OF EXCESS
AMOUNT AL RATE OVER OVER
NOT AMOUNT AL RATE OVER
OVER NOT OVER (a) (b) (c)
(a) (b) (c) OVER
- - - - -
- 250,00 250,000
250,000 400,000 - 250,000
0 15%
250,000 400,000 - 250,000
20% 400,000 800,000 22,500 20% 400,000
400,000 800,000 30,000 25% 400,000
800,000 2,000,000 102,500 25% 800,000
800,000 2,000,000 130,000 30% 800,000
2,000,00 8,000,000 402,500 30% 2,000,000
2,000,00 8,000,000 490,000 32% 2,000,000 0
0
2,202,500
8,000,00 - 2,410,000
35% 8,000,000 8,000,00 - 35% 8,000,000
0 0
13
INCOME TAX PROVISIONS
• Below P10,000 taxed at 5% • Below P250,000 no tax
• Over
14
P500,000 taxed at 32% • Over 8M taxed at 35%
• No counter provision • OPTIONAL 8% gross revenue
below 3M for self-employed &
professionals to be taxed in lieu
of
• 1) graduated income tax and
2)percentage tax
• Personal exemption • No more personal and

P50,000 additional exemption
• Additional exemption
P25,000 per child not
exceeding 4
• 13th month and other • 13th month and other
benefits P82,000 benefits P90, 000
INCOME TAX PROVISIONS
• Employees of RHQ, • preferential
ROHQ, OBU & treatment shall not
petroleum service apply anymore
contractors taxed at
15%
• Fringe benefit tax • fringe benefit tax
32% 35%
• none • returns maximum
of 4 pages
• 1Q deadline April 15 • 1Q deadline May 15
• 2nd installment July 15 • 2nd installment
October 15
FINAL TAX PROVISIONS
• PCSO & LOTTO
16
• Taxable above
winning exempt P10,000
• Interest income of • 15% whether recipient
foreign currency is individual or
denominated units 7 domestic corporation
½%
• CGT on unlisted shares • 15%
5% of 1st P100,000 net
of capital gains
realized and 10% in
excess of P100,000
VALUE ADDED TAX PROVISIONS
• VAT TRESHOLD • 3M
P1,919,500
17
• SALE OF GOODS TO • 12% with enhanced VAT

PEZA 0% refund system
• VAT exempt sale of residential • P1.5M
lot not more than P1,919,300
• VAT exempt sale of residential

house & lot not more than
• 2.5m, by 2021 2m
P3,199,200
• VAT exempt - lease of • P15,000

residential unit P10T
VALUE ADDED TAX PROVISIONS
• Sale of medicine • VAT exempt sale of drugs &
medicine for DIABETES, HIGH
18 CHOLESTEROL AND
HYPERTENSION effective
Jan. 1 2019
• Asso. Dues, membership fees &
other assessments & charges of • VAT exempt
homeowner’s asso. & condominium
corp,- Vatable
• Amortization of input on • Repealed by 2022
capital goods 60
• 120days refund upon • 90 days
complete document • BIR officer maybe
• Inaction, appeal to CTA punished
after 120 day
• monthly & quarterly • 2023 only quarterly
VAT filing filing
PERCENTAGE TAX PROVISIONS
• COOPERATIVES are • Beginning January 2019,
exempt
19
from 3% gross annual gross receipts not
receipts tax exceeding P500,000 shall
not be exempt from 3%
VETOED
• Self-employed & • Jan. 1, 2019 if annual gross

professionals with gross receipt not exceeding
receipts of P1,919, 500 and P500,000 exempt-
less subject to 3% VETOED
• STOCK • 0.60 of 1%
TRANSACTION ON
listed shares 0.50 of
1%
EXCISE TAX PROVISIONS
• P31.20 per pack with 4% • P32.50 JAN 2018
increase annually • P35.00 JAN 2019
20 • P37.50 JAN 2020
• P40.00 JAN 2022
• 4% ANNUAL INCREASE
• DIESEL P0.00 PER LITER • P2.50 PER LITER 2018
• P4.50 PER LITER 2019
• P6.00 PER LITER 2020
• UNLEADED & PREMIUM • P7.00 PER LITTER 2018
GASOLINE P4.35 • P9.00 PER LITER 2019
• P10.00 PER LITER 2020
• NONE • MANDATORY MARKING OF
ALL FUEL PRODUCTS
• 2% FOR UP TO P600T • 4%
• P12,000 + 20% OVER P600T • 10% FOR OVER P600T-1M
• P112T + 40% OVER p1.1M • 20% OVER 1M-4M
• P512T + 60% over 2.1M • 50% FOR OVER 4M
EXCISE TAX PROVISIONS
• COSMETIC • COSMETIC
PROCEDURES FOR
21
PROCEDURES FOR
AESTHETIC REASONS AESTHETIC REASONS
- NONE – 5%
• SWEETENED • P6.00 PER LITER USING
CALORIC & NON-
BEVERAGES - CALORIC SWEETENERS
NONE • P12.00 PER LITER USING
HIGH-FRUCTUSE CORN
SYRUP
• P10 PER METRIC • 100% INCREASE IN
TON OF COAL RATE FOR OTHER
MINERALS
DOCUMENTARY STAMP TAX PROVISIONS
• VARIOUS • 100% INCREASE IN
22
TRANSACTIONS RATE
SUBJECT TO • EXCEPT DST ON
DIFFERENT RATES LOANS FROM P1 TO
P1.50 PER P200
• NO INCREASE IN SALE
OF REAL PROPERTY
AND INSURANCE
POLICIES
COMPLIANCE
23 REQUIREMENTS
• P600,000 • 3 MILLION
THRESHOLD FOR
KEEPING OF
BOOKS OF
ACCOUNTS FOR
ALL ENTITIES
ADMINISTRATIVE PROVISIONS
• P25 SALE REQUIRED TO • P100 SALE REQUIRED
ISSUE
24 OFFICIAL TO ISSUE OFFICIAL
RECEIPT/INVOICE RECEIPT/INVOICE
• ELECTRONIC SALES REPORTING – • ENHANCED ELECTRONIC POS
NONE EXCEPT THE QUARTERLY REPORTING BY THOSE IN EXPORT
SLSP and eSALES OF GOODS & SERVICES & LARGE
TAXPAYERS WITHIN 5 YEARS
FROM ENACTMENT OF TRAIN
• MONTHLY FILING OF WITHHOLDING TAX • QUARTERLY FILING OF WITHHOLDING TAX
AND PERCENTAGE TAX / VAT EXCEPT COMPENSATION &
VAT/PERCENTAGE
• DEFICIENCY INTEREST • DOUBLE THE LEGAL INTEREST RATE

PER ANNUM
• PENALTY FOR FAILURE TO TRANSMIT SALES • 1/10 OF 1% OF THE ANNUAL NET INCOME
DATE IN CRM/POS TO BIR – FOR THE 2ND YEAR PRECEDING THE
ADMINISTRATIVE PENALTY CURRENT TAXABLE YEAR FOR EACH DAY OF
VIOLATION OR P10,000 WHICHEVER IS
HIGHER & PERMANENT CLOSURE IF
VIOLATION EXCEEDS 180DAYS
Individuals Earning
PURELY COMPENSATION INCOME.
PURELY COMPENSATION income

shall be taxed based on the
GRADUATED INCOME TAX RATES
25
TAXABLE COMPENSATION
INCOME
GROSS COMPENSATION INCOME
Less: Non-taxable income/benefits such as but not
limited to:
¾ 13th mo. pay and other benefits (P90,000)
¾ de minimis benefits, and
¾ employee’sshare in the SSS, GSIS, PHIC, HDMF

mandatory contributions and union dues
TAXABLE INCOME FOR COMPENSATION
26
MINIMUM WAGE EARNERS (MWE)
shall be exempt from income tax on
STATUTORY MINIMUM WAGE INCLUDING:
1. Holiday pay,
2. Hazard pay
3. Overtime pay,
4. Night shift differential pay
earned by the aforementioned MWE shall likewise be
covered by the above exemption.
27
Husband and wife computation
y Husband and wife shall compute their individual
income tax SEPARATELY based on their respective
taxable income;
y if any income cannot be definitely attributed to or

identified as income exclusively earned or realized by
either of the spouses, the same shall be divided equally
between the spouses for the purpose of determining
their respective taxable income.
28
PROFESSIONAL –
y Person formally certified by a professional body
belonging to a specific profession by virtue of
having completed a required examination or
course of studies and/or practice, whose
competence can usually be measured against an
established set of standards;
y one who engages in some art or sport for money,

as a means of livelihood, rather than as a hobby.
29
PROFESSIONAL –
It includes but is not limited to
y lawyers, engineers, architects, CPAs,
y professional entertainers,
y professional athletes, directors, producers,
y insurance agents, insurance adjusters,
y management and technical consultants,
y bookkeeping agents, and other recipients of
professional, promotional and talent fees.
30
VAT Threshold
refers to the ceiling set to determine VAT
registrable taxpayers, currently set at
P3,000,000;
same threshold to be used to determine the
income tax liability of self- employed and/or
professionals under 8% option
under Sections 24(A)(2)(b) and 24(A)(2)(c)(2) of the Tax Code, as amended.
31
Taxpayer subject to the
GRADUATED INCOME TAX RATE
(20% to 35%)
Taxpayer subject to the GRADUATED INCOME TAX RATES
y either selected this as the income tax regime, or
y failed to signify chosen intention or
y failed to qualify to be taxed at the 8% income tax rate
is also subject to the applicable BUSINESS TAX, if any

.
GRADUATED INCOME TAX + VAT

GRADUATED INCOME TAX + PERCENTAGE TAX
32
NON--VAT REGISTERED Taxpayer
subject to the
INCOME
TAX
1701
1Q 1701Q 2Q 1701Q 3Q1701Q Graduated
Graduated Graduated Graduated income tax
income tax income tax income tax
BUSINESS
TAX
1Q 2Q 4Q 2551Q
2551Q
3Q 2551Q 3% percentage tax
2551Q 3% percentage tax 3% percentage tax
3% percentage tax
33
33
VAT REGISTERED Taxpayer
subject to the
INCOME
TAX
1Q 1701
1701Q
Graduated
2Q 1701Q 3Q 1701Q Graduated
Graduated Graduated income tax
income tax
income tax income tax
BUSINESS
TAX
4Q 2550Q
1Q 2550Q 2Q 2550Q 3Q 2550Q
VAT
VAT VAT VAT
34
34
(C ) INCOME TAX RATES FOR SELF-EMPLOYED INDIVIDUALS EARNING
INCOME PURELY FROM
SELF-EMPLOYMENT OR PRACTICE OF PROFESSION.
PURELY SELF-EMPLOYED INDIVIDUALS AND/OR

PROFESSIONALS whose gross sales/receipts and
other non-operating income does not
exceed the VAT threshold P3,000,000 as
provided in Section 109 (BB) of the Tax Code, as amended, shall have the
option to avail of :
35
CHOICES:
(PURELY Self-Employment/Practice of Profession)
1. The GRADUATED RATES under Section 24(A)(2)(a) of the
Tax Code, as amended; (20% to 35%)

OR
2. The 8% tax if 3M BELOW GROSS SALES/ RECEIPTS and
OTHER NON-OPERATING INCOME
in excess of P250,000
in lieu of:
a) GRADUATED INCOME TAX RATES under Section 24(A)(2)(a) and
b) PERCENTAGE TAX under Section 116.
36
Taxpayer shall be considered as having availed of the
GRADUATED income tax rates
¾ UNLESS THE TAXPAYER SIGNIFIES

in the
A. 1st Quarter PERCENTAGE TAX RETURN (due April 25)
AND/OR
B. 1st Quarter INCOME TAX RETURN (due May 15)
Or
C. INITIAL QUARTER RETURN of the taxable year after
the commencement of a NEW BUSINESS /practice of
profession
of the taxable year, the intention to elect the 8% income tax

rate and such election shall be IRREVOCABLE
37
SIGNIFIES in the
1st Quarter income tax return
1Q 1701
Q FINAL ITR
2Q 1701Q 3Q
SIGNIFIED 1701
8% 8%
8% 8%
IRREVOCABLE FOR THE TAXABLE YEAR
38
1701Q
GRADUATED RATE ITEMIZED OSD
8% INCOME TAX
39
SECTION 3. INCOME TAX RATES ON INDIVIDUAL CITIZEN
AND INDIVIDUAL RESIDENT ALIEN
VAT-registered taxpayer,
regardless of the gross sales/
receipts can no longer avail of
the 8% option.
40
Taxpayers who are subject to Other
Percentage Taxes
under Title V of the Tax Code, as amended
Taxpayers who are subject to

Other Percentage Taxes under Title V of the Tax Code, as
amended, except those subject under Section 116 of the same Title,
HAVE NO OPTION TO AVAIL OF THE 8%

INCOME TAX RATE UNDER THE LAW.
e.g. cockpits 18%
night/day clubs 18%
41
Taxpayers who cannot avail of
the 8% income tax rate:
1. Those subject to Other Percentage Taxes

under Title V of the Tax Code, as amended, except those subject under
Section 116 of the same Title
2. Partners of a General Professional

Partnership (GPP) since their distributive share
from GPP is already net of cost and expenses.
42
Not a VAT--registered
person
GROSS SALES X 3% = PERCENTAGE TAX DUE
GROSS QUARTERLY SALES

(example: Jan. 300,000 + Feb. 300,000 + March 400,000)
1,000,000 X 3% = P3,000
PERCENTAGE TAX DUE
43
Taxpayers who did not qualify for the 8%
income tax rate
1. shall be subject to the graduated
INCOME TAX RATE, and
2. shall also be subject to the applicable

BUSINESS TAX/ES, if any.
44
Taxpayer’s source of income is
PURELY FROM SELF-EMPLOYMENT,
thus she is entitled to the amount
allowed as deduction of P250,000
under Sec. 24(A)(2)(b) of the Tax Code, as
amended.
45
Optional Taxation for individuals in
business/practice of profession
* In lieu of 1) graduated income tax and
2) percentage tax under Sec 116
8% income tax*
On gross sales/receipt
GROSS SALES /
RECEIPT and other non- And other non-operating income
operating income in excess of P250,000
3M and or
below 20% to 35%
Self-employed
/ Professionals GRADUATED income tax
GROSS SALES /
RECEIPT and other 20% to 35%
non-operating income
above 3M GRADUATED
income tax
46
j. MIXED INCOME EARNER
An individual earning
COMPENSATION + INCOME FROM BUSINESS
COMPENSATION + PRACTICE OF PROFESSION
COMPENSATION + OTHER SOURCES ASIDE FROM

EMPLOYMENT
47
MIXED INCOME EARNERS
* In lieu of 1) graduated income tax and
2) percentage tax under Sec 116
8% income tax*
On gross sales/receipt
3M and And other non-operating income
in excess of P250,000
BUSINESS/ below or
PRACTICE OF 20% to 35%
PROFESSION
GRADUATED income
tax
above
20% to 35%
3M
COMPENSATION GRADUATED
income tax
48
49
50
Registration of EMPLOYER as
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.
51
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
52
REGISTRATION AS WITHHOLDING
AGENT BY THE EMPLOYER
BIR Form No. 1901 SELF-EMPLOYED/PROFESSIONALS/TRUST
BIR Form No. 1903 CORPORATIONS / GOCC /PARTNERSHIP
BIR Form No. 1906 AUTHORITY TO PRINT
BIR Form No. 1907 PERMIT TO USE CASH REGISTER/Point of Sale (POS)
BIR Form No. 1900 CAS & components
BIR Form No. 1903 GOVERNMENT AGENCIES / LGUs

BIR Form No. 1902 EMPLOYEES / OCW / NON-RESIDENT CITIZEN
BIR Form No. 1905 REGISTRATION INFORMATION UPDATE
UPDATE REGISTRATION
CANCELLING REGISTRATION
REPLACEMENT OF LOST TIN CARD/CERTIFICATE
WHEN: ON OR BEFORE COMMENCEMENT OF BUSINESS/

BEFORE PAYMENT OF ANY TAX DUE/
UPON FILING A RETURN
10 DAYS AFTER BECOMING AN EMPLOYER
( SEC 2.83.6 Rev. Regulations No. 2-98, as amended)
WHERE: Revenue District Office

Expected Document to be received by the employer: Certificate of Registration (COR)
53
REGISTRATION of all
EMPLOYEES
ALL EMPLOYEES MUST fill-up:

• Upon Employment - BIR FORM NO. 1902
Application for Registration
54
PRESCRIBING POLICIES, GUIDELINES
AND PROCEDURES ON THE
REGISTRATION OF
EMPLOYEES
(BIR FORM NO. 1902)
55
OBJECTIVES
y Clarify the procedures on the
registration of employees;
y Prescribe policies and guidelines in the

issuances of TIN of employees
using the eREG System
56
SECURE TIN OF EMPLOYEES
via eREG by employers only
1. Access eREG www.bir.gov.ph
2. ONLINE ENROLLMENT by authorized
representative of the EMPLOYER
3. Validation by RDO on enrollment details of
employer and representative
4. Receive email confirming APPROVAL /
disapproval with PASSWORD to use eREG
5. Access eREG with the password emailed by
BIR
57
58
59
60
HOW TO COMPUTE
WITHHOLDING TAXES
ON COMPENSATION
INCOME / SALARIES /
WAGES
61
Compensation defined
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.
62
DE MINIMIS BENEFITS
a. Monetized unused vacation leave
credits of private employees not
exceeding 10 days during the
year;
b. Monetized value of vacation and
sick leave credits paid to
government officials &
employees;
63
DE MINIMIS BENEFITS
cMedical cash allowance to
dependents of employees not
exceeding P1500 per employee per
semester or P250 per month;
d. Rice subsidy of P2,000 or one (1)

sack of 50-kg. rice per month
amounting to not more than P2,000;
64
De minimis benefits
e. Uniforms and clothing allowance not
exceeding P6,000 per annum;
f. Actual medical assistance
e.g. medical allowance and healthcare needs,
annual medical/ executive check-up,
maternity assistance, and
routine consultations,
not exceeding P10,000 per annum;
g. Laundry allowance not exceeding P300 per
month;
65
De minimis benefits
h. Employees achievement awards,
e.g. 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
P10,000 received by the employee under an
established written plan which does not
discriminate in favor of highly paid employees;
66
De minimis benefits
i. Gifts given during Christmas and major
anniversary celebrations not exceeding P5,000 per
annum;
j. Daily meal allowance for

y overtime work and
y night/graveyard shift
not exceeding 25% of the basic minimum wage on
a per region basis
67
Revenue Regulations 1-2015
DE MINIMIS BENEFITS Sec 2.78.1 (A)(3) of RR
2-98, as amended
y K) Benefits received by an employee by virtue of
Collective Bargaining Agreement (CBA) and
productivity incentive scheme provided that the total
annual monetary value received from both combined
do not exceed P10,000 per employee
per taxable year
Section 2.33 (c) of RR 3-98, as amended

y C) Fringe benefits not subject to FBT
68
y All other benefits given by
employers which are not included
in the above enumeration shall not
be considered as “de minimis”
benefits, and hence, shall be
subject to income tax as
well as withholding tax on
compensation income.
69
13th month + 0ther
benefits
13th month = 1 month salary
+ other benefits
P90,000
70
Term “EMPLOYEE”
An individual performing services under an
employer-employee relationship. The
term covers all employees including officers and
employees, whether elected or appointed,
of the Government of the Philippines, or any political
subdivision thereof or any agency or instrumentality.
Thus, the official and employees of the barangays

are employees of the Government and shall be
subjected to WITHHOLDING TAX, if applicable,
pursuant to Section 79(A) of the Tax Code as implemented by Section
2.79(A) of RR 2-98, as amended
71
TAX REFUND
on purely compensation income
EMPLOYER shall:
y Ensure correct computation of
y TAX WITHHELD = TAX DUE scenario.
y Refund excess withholding tax to employees, if any

PENALTY: Equal to the total amount of refund not refunded to
employees
Reminder: Non-processing of TAX REFUND

for taxpayers receiving purely compensation
income by the RDOs.
72
HOW TO COMPUTE
AND
WITHHOLD
TAXES ON COMPENSATION
INCOME USING THE
PRESCRIBED
WITHHOLDING
TAX TABLE
73
REVISED WITHHOLDING TAX TABLE
Effective January 1, 2018 to December 31, 2022
DAILY 1 2 3 4 5 6
Compensation 685 and 685-1095 1,096-2,191 2,192-5478 5,479-21,917 21,918 and
Range below
above
Prescribed 0.00 0.00 82.19 358.16 1,342.47 6,602.74
Withholding Tax
+20% over 685 +25% over P1,096 +30% over 2,192 + 32% over 5,479 + 35% over 21,918
WEEKLY 1 2 3 4 5 6
Compensation 4,808 38,462-
Range
and below
4,808-7,691 7,692-15,384 15,385- 153,846
38,461 153,845 and above
Prescribed 0.00 0.00
Withholding Tax +20% over 4,808
576.92 2,500.00 9,423.08 46,346.15
+25% over 7,692 +30% over 15,385 + 32% over 38,462 + 35% over 153,846
SEMI-MONTHLY
1 2 3 4 5 6
Compensat 10,417 33,333- 83,333-
10,417-16,666 16,667-33,332 333,333 and
ion Range AND BELOW
83,332 333,332 above
Prescribed 0.00 0.00 1,256.00 5,418.89 20,416.67 180,416.57
Withholding Tax +20% over 10,417 +25% over 16,667 +30% over + 32% over + 35% over
33,333 83,333 333,333
MONTHLY 1 2 3 4 5 6
Compensat 20,83 66,667- 166,667 - 666,667 and
ion Range 20,833- 33,333- above
3 AND 166,666 666,666
BELOW 33,332 66,666
Prescribed 0.00 0.00
Withholding Tax +20% over 20,833
10,833.33 40,833.33 200,833.3
2,500+30% over 32% overMAY 25, 3
BY: MARIVIC A. GALBAN GACPA CONVENTION – WATERFRONT
+25% over 33,333
66,667
CEBU+ CITY
166,667
74
2018
+ 35%
75
RMC 1-2018
Steps in the
Use of the Withholding Tax Table
y ln general, every employer paying compensation to
its employee/s shall DEDUCT AND WITHHOLD
from such compensation a tax determined in
accordance with the prescribed Revised
Withholding Tax Tables, version 2 (Annex "A").
76
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
77
to be Withheld
Segregate the taxable from the

non-taxable compensation paid to the
employee for the payroll period
Note: RATA & PERA granted to public officers and

employees under General Appropriations Act shall not be
subject to income tax and consequently to withholding tax.
78
RMC 1-2018
Steps in the
Step 2. Use the appropriate table in Annex "A"

for the applicable payroll period.
• Monthly
• Semi-monthly
• Weekly
• Daily
.
79
RMC 1-2018
Steps in the
Step 3. Determine the compensation
range of the employee and apply the
applicable tax rates prescribed thereon.
MONTHLY 1 2 3 4 5 6
Compensation 20,833 66,667- 166,667 - 666,667 and
AND
20,833-33,332 33,333-66,666 above
Range 166,666 666,666
BELOW
Prescribed 0.00 0.00 2,500 10,833.33 40,833.33 200,833.33
Withholding +20% over 20,833 +25% over 33,333 +30% over + 32% over 166,667 + 35% over 666,667
Tax 66,667
80
RMC 1-2018
Steps in the
Step 4.. Compute the withholding tax due

by adding the tax predetermined in the
compensation range indicated on the column used
and the tax on the excess of the total
compensation over the minimum of the
compensation range.
81
to be Withheld
. Compute the withholding tax due by adding

the tax predetermined in the compensation
level indicated 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 of the same column/ compensation
level.
82
An employee receiving semi--monthly
Example 3:
compensation in the amount of P15,500, net

of mandatory contributions.
y By using the semi- monthly withholding tax table, the withholding tax beginning January 2018 is computed by referring to
compensation range under column 2 which shows a predetermined tax of P0.00 on P10,417.00 plus 20% of the excess of
Compensation Range (Minimum) amounting to P5,083.00 (P15,500 - P10,417.00) which is P1,016.60. As such, the withholding tax to
be withheld by the employer shall be P1,016.60.
Total taxable compensation 15,500
Less: Compensation Range 2 (Minimum) 10,417
Excess
5,083
Withholding tax shall be computed as follows:
Predetermined Tax on P10,417 0.00
Add: Tax on the excess (P5,083 x 20%) 1,016.60
Total daily withholding tax 1,016.60
SEMI-
MONTHLY
1 2 3 4 5 6
Compensation 10,417
Range AND 10,417- 16,667- 33,333- 83,333- 333,333 and
BELOW 83,332 333,332 above
16,666 33,332
Prescribed 0.00 0.00 1,256.00 5,418.89 20,416.67 180,416.57
Withholding
+20% over +25% over +30% over + 32% over + 35% over
Tax 333,333
10,417 16,667 33,333 83,333
83
84
85
86
87
Employer may use of Exceptional
Computation
a. Cumulative Average Method

b. Annualized Withholding Tax Method
88
Version 6
89
PROCEDURES FOR ALPHALIST DATA ENTRY V6.0
A. PROCEDURES TO INSTALL, IMPORT AND
UPDATE DATABASE
I. INSTALL
1. Go to www.bir.gov.ph
2. Go to Downloadables
3. Download the Alphalist v6 Setup
4. Install the downloaded Alphalist v6 Setup
5. Enter the Company Taxpayer Information
90
91
92
Employees Withholding Statement of Compensation
and Withholding Tax
BIR Form 2316
per Sec 2.83.1 of RR 2-98, as amended
DUPLICATE COPY
for the BIR
transmitted on or
before February 28
BIR FORM
2316 TRIPLICATE COPY
for EMPLOYER
ORIGINAL COPY - (to be retained for
EMPLOYEE 10 years)
EMPLOYER
Issued BIR Form 2316
To ALL EMPLOYEES
Not later than
JANUARY 31
Alphalist of employees submitted to BIR

thru email: esubmission@bir.gov.ph
93
CERTIFIED LIST OF
EMPLOYEES
QUALIFIED FOR
BIR SUBSTITUTED
On or
FORM FILING OF before
2316 ANNUAL Feb
INCOME TAX
DUPLICATE COPY
RETURN (ITR)
28
-EMPLOYEE
BIR
94
95
Uses of BIR Form 2316
(Substituted Filing of ITR)
y Proof of financial capacity for loan, credit
card and other applications
y Proof of payment of tax or for availing tax
credit in the employee’s home country
y Securing travel tax exemption, when
necessary
y Other purposes with various government
agencies such as school scholarship
96
1. AN INDIVIDUAL EARNING PURELY
COMPENSATION INCOME WHOSE TAXABLE
INCOME DOES NOT EXCEED P250,000;
• the Certificate of Withholding filed by the respective
Employers, duly stamped “Received” by the Bureau, shall be
tantamount to the SUBSTITUTED FILING of income tax
returns by said employees;
2. An individual whose income tax has been correctly
withheld by his employer, provided, that such
individual HAS ONLY ONE EMPLOYER for the
taxable year –
• the Certificate of Withholding filed by the respective Employers,
duly stamped “Received” by the Bureau, shall be tantamount to the
SUBSTITUTED FILING of income tax returns by said employees;
97
3. An individual whose sole income has been
subjected to final withholding tax; and
4. A minimum wage earner as defined in these

regulations.
• the Certificate of Withholding filed by the respective
Employers, duly stamped “Received” by the Bureau, shall be
tantamount to the SUBSTITUTED FILING of income tax
returns by said employees;
98
Multiple employers
All individuals deriving compensation
income, regardless of the amount,
FROM TWO (2) OR MORE
y CONCURRENT OR
y SUCCESSIVE EMPLOYERS
at any time during the taxable year, are not

qualified for substituted filing.
y REQUIRED TO FILE A RETURN.
99
PROFESSIONAL (RMC 69-2017
NON-
LICENSED
LICENSED
100
NON-LICENSEDPROFESSIONAL
RMC 69-2017
y Refer to those individuals who are not identified under

Sec. 2.57.2(A)(1) of RR 2-98, as amended, and who
are not registered with and regulated by:
y PROFESSIONAL REGULATIONS COMMISSION (PRC)
y SUPREME COURT (SC)
y INTEGRATED BAR OF THE PHIL. (IBP)
y MARINA
y CAAP
y Etc.
who render service or labor-only for a fee
or under a contract of service
101
JOB ORDER
June 15, 2017
CIVIL SERVICE COMMISSION

(CSC)
COMMISSION ON AUDIT (COA)
DEPARTMENT OF BUDGET AND
MANAGEMENT (DBM)
102
1.BACKGROUND
y Government agencies, including GOCCs, have been authorized in
previous executive issuances and general appropriations acts to
enter into contracts with government entities,
private firms or individuals, and non-government organizations
for services related incidental to their respective functions and
weather on part-time or full-
operations,
time basis.
y Agencies have used this provision as basis for directly
hiring individual workers on contract of

service or job order to perform specific
jobs or to
supplement their current manpower.
103
1.BACKGROUND
y CSC MC No. 40, s 1998, prescribed the policies
and guidelines regarding
y Contracts of Services (COS) and
y Job Order (JO’s)
y entered into by all government agencies on both
individual and institutional basis. Said CSC policy
Service Law, rules, and regulations; and that
services rendered thereunder are
not considered as
government service.
104
1.BACKGROUND
y However, the proliferations of individual Job Order and
Contact of Service workers in the government and their
involvement even in the performance of regular agency
functions have been observed.
THIS SITUATION GAVE RISE TO THE FOLLOWING ISSUES:

a) lack of social protection for the workers and inequality
in benefits, and
b) obscure accountability of JO/COS workers due to lack
of employee-employer relationship with the hiring
agency.
y In view of the foregoing, there is a need to clarify the

guidelines on availing of the services of COS and Job Order
workers.
105
2. POLICY STATEMENT
y Government agencies are
authorized to ENTER INTO
SERVICE CONTRACTS with other
government agencies, private
firms, non-government agencies or
individuals for services related or
incidental to their respective
functions and operations weather
on a part-time or full time basis.
106
3. PURPOSE
yThis Joint Circular is issued to
prescribed the rules and
regulations governing
yContact of Service and
yJob Order
workers in the government.
107
4. COVERAGE
This Joint Circular covers
all:
y National Government Agencies ,
y Government –Owned or Controlled
Corporations with original charters,
y State Universities and Colleges and
Constitutional bodies,
y which avail of the services of Contract of
service and Job Order workers.
108
5.1 Contract of Service
y refers to the engagement of the
service and of an individual private
firm, other government agency, non-
government agency or international
organization as
y CONSULTANT,
y LEARNING SERVICE
PROVIDER OR
y TECHNICAL EXPERT
to undertake special project or
job within a specific period.
109
5.2 Contractor of Service
PROVIDER
y refers to an individual, a government
agency, private or non-government
entity, duly registered and
recognized by authorized
government agencies to provide
consultancy service in their
respective field of expertise.
110
5.3 INSTITUTIONAL
CONTRACT
y refers to the agreement between
the government agency and
contactor or service provider
duly-registered and recognized by
authorized government agencies to
provide services such as
y janitorial,
y security,
y CONSULTANCY, and
y OTHER SUPPORT SERVICES.
111
5.4 JOB ORDER
y refers to piece work (pakyaw) or
intermittent or emergency
jobs such as
y cleaning of debris on the roads, canals,
waterways etc. after natural/man-made
disasters/occurrences and
y other manual/trades and crafts services
such as carpentry for a specific piece of
work.
112
5.5 Support services
may include
y janitorial security,
y driving,
y data encoding,
y equipment and grounds maintenance
and
y other services
that support the day to day
operations of the agency.
113
6.1 INSTITUTIONAL
Contract of Service
As a general rule, government agencies may
avail of outsourced services through
institutional Contract of Service, subject to the
following conditions:
6.1.1 Institutional Contact of Service covers lump

sum work or services to perform janitorial, security,
consultancy, and other support functions for a
maximum period of one (1) year
subject to the provisions of R.A No. 9184’ and
pertinent budgeting, accounting rules and regulations.
114
6.1 INSTITUTIONAL
Contract of Service
The contractor or service provider should
meet the following requirement:
a) Duly registered with the DOLE
b) Duly registered with the BIR;
c) For sole proprietorship, duly registered with the SEC;
and
d) Must be an active employer registered with the following
agencies:
1) Social Security System (SSS)
2) Home Development Mutual Fund (PAG-IBIG Fund), and
3) Philippine Health Insurance Corporations (PHILHEALTH)
115
6.1 INSTITUTIONAL
Contract of Service
6.1.2 Workers hired through institutional contract of service shall
remain to be employees of the contractor of service
provider.
6.13 The discipline of workers under institutional contract of
service shall be the responsibility of the contractor of
service provider. The head of the procuring entity may
report to the contractor of service provider any misconduct or
wrong doing of the said worker/s.
6.1.4 The contractor of service provider shall be responsible for
providing the workers with compensation and benefits
compliant with existing labor law including the necessary
social security and other benefits mandated by law in
addition to direct compensation as payment for their services.
116
6.2 INDIVIDUAL
Contract of Service
Government agencies may enter into contract
of service with individuals as consultants/contractors
subject to the following guidelines:
6.2.1 The term of contract between the agency and the individual
contractor shall be for a maximum period of one
(1) year, renewal at the option of the Head
of the procuring entity, but in no case shall exceed
the term of the latter.
6.2.2 Engaging the services of Individual contractor shall be

subject to pertinent provisions of R.A no. 9184 and its implementing
guidelines, as applicable and the existing budgeting, accounting and
auditing rules and regulations.
117
6.3 Job Order
Government agencies may hire job order
workers subject to the following conditions:
6.3.1 The services of a job order worker is

either paid to an
y agreed contract amount for the piece of
work or
y on a daily wage basis.
6.3.2 Contracting the services of job order
workers shall be subject to pertinent
budgeting, accounting and auditing rules
and regulations.
118
7. Limitations
7.1 Hiring under contract of service shall be
limited to CONSULTANTS, LEARNING
SERVICE PROVIDERS, AND/OR OTHER
TECHNICAL EXPERTS to undertake special
project or job within a specific period.
y the project or job is not part of the regular functions of
the agency or the expertise is not available in
the agency, or it is impractical or more
expensive for the government agency to
directly undertake the service provided by the individual
institutional contractor.
119
7. Limitations
7.2 Hiring of Job Order workers shall be
LIMITED TO EMERGENCY OR
INTERMITTENT WORK, such as clearing
of debris on the roads, canal, waterways, etc.
after natural/man-made disasters/
occurrences, other trades and crafts and
manual tasks such as carpentry, plumbing,
painting, electrical, and the like which are
not part of the regular
functions of the agency.
120
7. Limitations
7.3 Contract of service and job order workers
should not be designated to positions
exercising control or supervision over
regular and career employee.
7.4 The services of the contact of service and job

order workers are not covered by Civil
Service Law and rules thus, not credible
as government service.
They do not enjoy the benefits enjoyed by
government employees, such as leave, PERA,
RATA and thirteenth month pay.
121
8. PAYMENT OF SERVICES under
Individual Contract of Service
y Individuals hired through contract of service shall

be paid the prevailing market rates,
subject to the provisions of R.A 9184 and its
implementing rules and Regulations.
y The payment of services shall be charged against
the Maintenance and other Operating
expenses (MOOE) in the approved agency
budget.
y Individuals hired through contract of service have
the OPTION TO ENROLL THEMSELVES IN
SOCIAL BENEFIT
GACPA PROGRAMS
CONVENTION
BY: MARIVIC A. GALBAN – WATERFRONTthru
CEBUthe
CITYSSS,
MAY 25, 2018
122
8. PAYMENT OF SERVICE
under Job Order
y Individuals hired through job order shall be
paid wages equivalent to the DAILY
WAGE/ SALARY of comparable
positions in government a premium
of up to 20% of such wage/salary.
y The payment of services shall be charged

against the Maintenance and Operating
Expenses in the approved agency budget.
123
9. Monitoring
yThe COA shall monitor the

compliance of agencies with the
provisions of this Joint Circular.
124
11. Transitory Provisions
11.1 Agencies may RENEW the individual

contracts of existing Contact Service or Job
Order workers until December 31, 2018.
Thereafter, hiring of Contract of Service and job
Order workers shall be in accordance with the provisions of
this Joint Circular.
As far practicable and to ensure protection of the existing
Contact of service or job Order workers, the institutional contract to be
entered into by government agencies with a contractor or service
provider shall include a provision which will state that the existing
qualified Contract of Service or Job Order workers
hired by the agency shall be GIVEN PRIORITY in the
hiring by the contactor or service provider.
125
11.2 Existing Contract of service or job
Order workers shall be given priority
in the appointment by the
agency to its vacant positions
provided that these workers meet
appropriate eligibility and other
qualification requirements for the
positions subject to existing Civil Service
law and rules.
126
11.3 In accordance with Section 90 of the General Provisions of the FY
2017 General Appropriate Act, government agencies shall
review their functions systems and procedures,
organizational structure and staffing to determine
the appropriate manpower
compliment for their programs/ activities/projects. Creation
of permanent positions may be considered for regular functions, while
hiring of casual of contractual personnel may be considered for projects
and activities that are temporary in nature, subject to approval of the
oversight agencies concerned and to existing budgeting and
accounting rules and regulations.
127
12. Sanctions
y Heads of agencies and/or responsible
officers found to violate the provisions of
these rules and regulations may be
charged before the proper
administrative bodies (Office of the
ombudsman, Office of the President or
Civil Service Commission) for violation of
existing Civil Service law and rules and
serious nature or conduct prejudicial to
the best interest of the service.
128
13. Resolution of Issues
yIssues and concerns that may
arise in the implementation of
these rules and regulations shall
be resolved by the CSC, COA
and DBM, as appropriate.
129
LONE PAYOR
(1 SOURCE OF INCOME)
OPTION to avail of:
y SUBSTITUTED PERCENTAGE TAX
RETURN
(ONE PAYOR)
y SUBSTITUTED VAT RETURN

(0NE PAYOR)
130
RR 14-2003
in order to
y Amending RR No. 2-98, as amended,
simplify the collection of tax,
through withholding at the source,
y on sales of goods or services subject to the 3% percentage tax
under Section 116 of the Code, and/or
y to the value-added tax (VAT) under Sections 106 and 108 of
the same Code.
y SUBSTITUTED PERCENTAGE TAX RETURN (ONE

PAYOR)
y SUBSTITUTED VAT RETURN (0NE PAYOR)
131
SUBSTITUTED PERCENTAGE TAX
(ONE PAYOR)
y The payor (e.g.HOR) shall submit the LIST
OF CONSULTANTS as basis for the
issuance of TIN by the RDO where payor is
registered.
y The list shall show the name, address and

birthdate of consultants and shall be
accompanied by any identification issued by
the government body and the NOTICE OF
AVAILMENT OF THE SUBSTITUTED
FILING OF PERCENTAGE TAX RETURN.
132
(ONE PAYOR)
2. The consultant shall have the OPTION to file
return if the 3% percentage tax based on gross
receipt of the payee has been subjected to
withholding tax by the LONE PAYOR.
The BIR Form 1600 duly filed by the payor
shall serve as the SUBSTITUTED RETURN
of the payee with the lone payor
y provided that BIR Form 2306 duly
executed by both payor and payee
is attached to the filed BIR Form
1600.
The filing of percentage tax return (BIR Form
2551Q) is NO LONGER REQUIRED.
133
(ONE PAYOR)
3. Payees with LONE PAYOR shall be

y EXEMPTED from the obligation of ISSUING
REGISTERED NON-VAT RECEIPTS covering
their receipt of payments.
y The “ Certificate of Final Tax Withheld at Source

(BIR Form 2306) issued to the payee shall
SERVE AS THE SUBSTITUTED OFFICIAL
RECEIPT.
134
“(E) Regular Percentage Tax Return
If the payee has more than one payors
y On the other hand, if the payee has

more than one payors, the
percentage tax withheld and remitted
by the payor under BIR Form No.
1600 shall be treated as
creditable tax by the payee
when he files BIR Form No. 2551Q.
135
NOTICE OF AVAILMENT OF THE
NOTICE OF CANCELLATION OF
OPTION TO PAY THE TAX THROUGH THE AVAILMENT OF THE
WITHHOLDING PROCESS (RR 14-2003) OPTION TO PAY THE TAX THROUGH THE
WITHHOLDING PROCESS (RR 14-2003)
NOTICE OF AVAILMENT OF THE
SUBSTITUTED FILING OF NOTICE OF AVAILMENT OF THE
PERCENTAGE TAX RETURN
(RR 14-2003) SUBSTITUTED FILING OF VAT RETURN
SWORN DECLARATION AND NOTICE OF CANCELLATION OF
WAIVER OF THE PRIVELEDGE TO CLAIM INPUT
AVAILMENT OF THE SUBSTITUTED FILING
TAX
UNDER SEC. 110 OF THE TAX CODE OF PERCENTAGE / VAT RETURN
REGISTRATION AND COMPLIANCE OF
PROFESSIONALS
Copy of ANY
BIR FORM
CONTRACT GOVERNMENT
1901
OF SERVICE ISSUED ID
REGISTRATION
BIR Form No. 1901 SELF-EMPLOYED/PROFESSIONALS/TRUST
ATTACH: (Payor consolidates and files for those availing SUBSTITUTED FILING.
Tabulates Detailed Summary):
• Job Order/MOA duly certified by the agency,
• Birth Certificate, etc.
• Substituted Percentage Tax Return
1. Notice of availment of SUBSTITUTED PERCENTAGE TAX
Or
• Substituted VAT Tax Return
1. Notice of availment of SUBSTITUTED VAT
2. Waiver of Input Tax
REGISTER tax types:
1. Annual Registration Fee (ARF) P500 every Jan 31
using BIR Form 0605
2. IncomeGACPA
Tax CONVENTION – WATERFRONT CEBU CITY MAY 25, 2018 140
REG FEE (ARF)
P500 ANNUAL
COR
PERCENTAGE / VAT
BOOKKEEPING
INVOICING
1701 ITR
1701Q
2550M / 2550Q (VAT)
2551Q (PT)
BUSINESS
INDIVIDUAL EWT TAX
(GMP)
JOB ORDER
below 3M
INCOME
GROSS
INCOME
GROSS
TAX
PERCENTAGE
VAT
3M
OR
SERVICE CONTRACT AGREEMENT
above
WITH GOVERNMENT
PROFESSIONAL (license & non-
license)& with gross receipt of * *
P250,000 below (LONE PAYOR)
Non-license professional with 2% 3 5%
gross receipt above P250,000 * * * or 10% %
or
12%
10%
(LONE PAYOR) **
License PROFESSIONAL 5% 5%
or or
with gross receipt above P250,000 10% 10% 3 12
*
%
(LONE PAYOR) * * * ** %
* May avail of SUBSTITUTED FILING of percentage tax /VAT return & SUBSTITUTED OFFICIAL RECEIPT
** 5% EWT with SWORN & COR; 10% without SWORN & COR;
10% EWT for VAT registered or gross of 3M above
Opted for 8% income tax for 3M below: No creditable PERCENTAGE TAX & not required to
file 2551Q; file 1701Q & 1701 with no FS
141
REG FEE (ARF)
P500 ANNUAL
COR
PERCENTAGE / VAT
BOOKKEEPING
INVOICING
1701 ITR
1701Q
2550M / 2550Q (VAT)
2551Q (PT)
BUSINESS
INDIVIDUAL EWT TAX
(GMP)
JOB ORDER
below 3M
INCOME
GROSS
INCOME
GROSS
TAX
PERCENTAGE
VAT
3M
OR
SERVICE CONTRACT AGREEMENT
above
WITH GOVERNMENT
Non-license 2% 3%
professional or
10% 5%
10%
(MULTIPLE PAYOR) **
License 5% 3%
PROFESSIONAL or
10% 5%
10%
(MULTIPLE PAYOR)
**
* May avail of SUBSTITUTED FILING of percentage tax /VAT return & SUBSTITUTED OFFICIAL RECEIPT
** 5% EWT with SWORN & COR; 10% without SWORN & COR;
10% EWT for VAT registered or gross of 3M
above
Opted for 8% income tax for 3M below: No creditable PERCENTAGE TAX & not
required to file 2551Q; file 1701Q & 1701 with no FS
142
EXPANDED WITHHOLDING TAX
143
PAYEE /
INCOME RECIPIENT
SAWT
FORMAT
Annex “B”
BIR REGISTERED NAME

TRADE NAME
ADDRESS
TIN
MONTHLY ALPHALIST OF WITHHOLDING TAXES (MAWT)

RETURN PERIOD
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
CERTIFICATES
BIR
DLN:
BIR Form No.
Republika ng Pilipinas
Certificate of Compensation
Kagaw aran ng Pananalapi
Kawanihan ng Rentas Internas
For Comp ensation Pay ment With or Without Tax Withheld
Payment/Tax Withheld 2316
October 2002 (ENCS)
1 For the Year 1 2 For the Period
( YYYY ) From (MM/DD) To (MM/DD)
Part I Em ploye e Inform ation Part IVD et ai l s o f C o mp ensat i o n I nco me and T ax W i t hhel d f r o m P r esent E mp l o
3 Taxpayer 3 Amount
Identif ication No. A. Non-Taxable /Exe m pt Com pe ns ation Incom e
DLN:
4 Employee's Name (Last Name, First Name, Middle Name) 5 RDO Code 25 13th Month Pay and 25
BIR Form No. Other Benef its
Republika ng Pilipinas
Certificate of Compensation 26 SSS, GSIS, PHIC & Pag-ibig 26
2316
ALPHALIST
Kawanihan ng Rentas Internas 6 Registered Address 6A Zip Code
Contributions, & Union dues
Payment/Tax Withheld 27 Salaries & Other Forms of
Compensation
27
For Comp ensation Pay ment With or Without Tax Withheld October 2002 (ENCS)
6B Local Home Address 6C Zip Code 28 Total Non-Taxable/Exempt 28
1 For the Year 1 2 For the Period Compensation Income
( YYYY ) From (MM/DD) To (MM/DD)
Part I Em ploye e Inform ation Part IV
6D Foreign Address D et ai l s o f C o mp ensat i o n I nco me and T ax W i t hhel
6E Zip Code d f r o m P r esent E mp l o
B. Taxable Com pe ns ation Incom e
3 Taxpayer 3 Amount
Identif ication No. A. Non-Taxable /Exe m pt Com pe ns ation Incom e REGULAR
4 Employee's Name (Last Name, First Name, Middle Name) 75 Date
RDOof Birth 25
Code (MM/DD/YYYY) 8 Telephone 25 Number 29 Basic Salary 29
13th Month Pay and
Other Benef its
26 SSS, GSIS, PHIC & Pag-ibig 26
9 Exemption Status 30 Representation 30
6 Registered Address 6A Zip Code
Single Contributions,
Head of&the Union dues
Family Married
27 Salaries & Other Forms of 27
9A Is the w if e claiming the additional exemption f or qualif ied dependent children?
Compensation
DLN:
6B Local Home Address 6C Zip Code Yes
28 Total Non-Taxable/Exempt No 28 31 Transportation 31
BIR Form No. Compensation Income
Republika ng Pilipinas 10 Name of Qualif ied Dependent Children 11 Date o f B irth (M M /DD/YYYY)
Certificate of Compensation
Kawanihan ng Rentas Internas
For Comp ensation Pay ment With or Without Tax Withheld
6D Foreign Address
Payment/Tax Withheld
7 Date of Birth (MM/DD/YYYY)
2316 6E Zip Code
October 2002 (ENCS)

8 Telephone Number
B. Taxable Com pe ns ation Incom e
REGULAR
29 Basic Salary 29
32 Cost of Living Allow ance
33 Fixed Housing Allow ance

32
33
1 For the Year
Part I
( YYYY )
1
Em ploye e Inform ation

2 For the Period
9 Exemption
From
Part IVD et ai Status
(MM/DD) To (MM/DD)
12 Other Dependent (to be accomplished if taxpayer
l s o f C o mp ensat i o n I nco me and T ax W i t hhel d f r o m P r esent E mp l o 30 Representation 30
34 Others (Specif y)
is head of the f amily) 3 4 A 34A
FORMAT
Date o f B irth
3 Taxpayer 3 Single Head of the Family AmountMarried Name of Dependent Relationship
(M M /DD/YYYY
Identif ication No. 9AA. Non-Taxable
Is the w if e claiming/Exethe
m pt Com peexemption
additional ns ation Incom e ied dependent children?
f or qualif 34B 34B
4 Employee's Name (Last Name, First Name, Middle Name) 5 RDO Code 25 13th Month Pay and Yes 25 31 Transportation
No Em ploye r Inform ation (Pre31
Other Benef its
10 Name of Qualif ied Dependent Children
26 SSS, GSIS, PHIC & Pag-ibig 26
11 Date o f B irth 13
Part II
(M MTaxpayer
/DD/YYYY)
Identif ication No.
13
s e nt) SUPPLEMENTARY
35 Commission 35 Annex “B”
6 Registered Address 6A Zip Code Contributions, & Union dues 14 Employer's Name 32 Cost of Living Allow ance 32 36 Prof it Sharing 36
27 Salaries & Other Forms of 27
Compensation 37 Fees Including Director's 37
33 Fixed Housing Allow ance 33 Fees
6B Local Home Address 6C Zip Code
28 Total Non-Taxable/Exempt
Compensation Income
28
12 Other Dependent (to be accomplished if taxpayer is head of the f amily) 3 4 A

15 Registered Address
34 Others (Specif y)
34A
15A Zip code 38 Taxable 13th Month Pay
and Other Benef its
38 BIR REGISTERED NAME
6D Foreign Address 6E Zip Code B. Taxable Com pe ns ation Incom e 39 Hazard Pay 39
REGULAR
Name of Dependent Relationship
Date o f B irth
(M M /DD/YYYY
Part III
main employer
34B
secondary employer
Em ploye r Inform ation (Pre vious )-1
34B
40 Others (Specif y) TRADE NAME
7 Date of Birth (MM/DD/YYYY) 8 Telephone Number 29 Basic Salary 29
Part II
13 Taxpayer
Identif ication No.
Em ploye r Inform ation (Pre s e nt)
13
30
16 Taxpayer SUPPLEMENTARY
16
35 Commission
Identif ication No.
35
40A 40A
ADDRESS
9 Exemption Status 30 Representation
Single Head of the Family Married 14 Employer's Name
9A Is the w if e claiming the additional exemption f or qualif ied dependent children?
17 Employer's Name
36 Prof it Sharing
37 Fees Including Director's
36
37
40B
41 Total Taxable Compensation 41

40B
TIN
31 Transportation 31 Fees
Yes No 18 Registered Address 18A Zip code Income
15 Registered Address 15A Zip code 38 Taxable 13th Month Pay 38
10 Name of Qualif ied Dependent Children 11 Date o f B irth (M M /DD/YYYY) Sum m ary
and Other Benef its
39 Hazard Pay 39 42 Taxable Compensation Incom42
32 Cost main
Part III
of Living Allow ance
employer 32secondary employer
Em ploye r Inform ation (Pre vious )-1 19 Taxpayer
40Em ploye
Others
19
r Inform
(Specif y) ation (Pre vious )-2 f rom Present Employer
43 Add: Taxable Compensation 43
12 Other Dependent (to be accomplished if taxpayer is head of the f amily)Identif
33 Fixed Housing Allow ance
16 34
Taxpayer
Others (Specif y)16
3 4 A ication No.
33
34A
Identif ication No.
20 Employer's Name
40A 40A
f rom Previous Employer (s)
44 Gross Taxable
Compensation Income
44 RETURN PERIOD
Date o f B irth17 Employer's Name 40B 40B 45 Less: Total Exemptions 45
Name of Dependent Relationship
(M M /DD/YYYY 21 Registered Address 21A Zip code 46 Less: Premium Paid on
34B 34B
41 Total Taxable Compensation 41 Health and/or Hospital 46
Part II
13 Taxpayer
Identif ication No.
Em ploye r Inform ation (Pre s e nt)
13
SUPPLEMENTARY
18 Registered
35 Commission
Address
35
18A Zip code Income
Em ploye r Inform ation (Pre
22
Sumvious
m ary)-3
Insurance (If applicable)
47 Taxable
Compensation Income
47 Seq TIN Registered Name Return Nature of income ATC Tax rate Tax base Tax
22 Taxpayer 42 Taxable Compensation Incom42
14 Employer's Name 36 Prof it Sharing
19 37
Em ploye r Inform36
Fees Including Director's
Taxpayer 19
ation (Pre vious )-2
37
Identif ication No.
23 Employer's Name
f rom Present Employer
43 Add: Taxable Compensation 43
48 Tax Due
49 Amount of Taxes Withheld
48
Fees 49A Present Employer 49A
15 Registered Address 15A Zip code20 38
Identif ication No.
TaxableName
Employer's 13th Month Pay
and Other Benef its
38
44 Gross Taxable
24 Registered Address
Compensation Income
44 24A Zip code 49B Previous Employer(s) 49B 3 mm/yy 5
39 Hazard Pay 39 50 Total Amount of Taxes 50
main employer secondary employer 21 40 Others (Specif
Registered Address y) 21A Zip code
45 Less: Total Exemptions
I declare,46 Less:
under Premium
the penalties o f Paid
Health and/or Hospital
45 Withheld
onthat this certificate has been made in go o d faith, verified by us, and to the best o f o ur kno wledge and belief, is true and co rrect
perjury,
46
1 2 4 6 7 8 9
Part III Em ploye r Inform ation (Pre vious )-1
16 Taxpayer
Identif ication No.
16 40A 40A
22
47 Taxable
Compensation Income
47 1
22 Taxpayer
17 Employer's Name 4 0B
Identif ication No. 40B 48 Tax Due 48
18 Registered Address 18A Zip code

23 Employer's Name
41 Total Taxable Compensation 41
Income
49A Present Employer 49A 2
24 Registered Address Sum m ary 24A Zip code 49B Previous Employer(s) 49B

42 Taxable Compensation Incom42
f rom Present Employer
50 Total Amount of Taxes
Withheld
50
I declare, under the penalties o f perjury, that this certificate has been made in go o d faith, verified by us, and to the best o f o ur kno wledge and belief, is true and co rrect
3
19 43 Add: Taxable Compensation 43
19 Taxpayer
Identif ication No.
20 Employer's Name
44 Gross Taxable 44
4
Compensation Income
21 Registered Address 21A Zip code

45 Less: Total Exemptions
46 Less: Premium Paid on
45 5
Health and/or Hospital 46

47 Taxable 47
TOTAL P P
22
22 Taxpayer
Identif ication No.
23 Employer's Name
Compensation Income
48 Tax Due
48 AMOUNT
49A Present Employer 49A
24 Registered Address 24A Zip code 49B Previous Employer(s) 49B

50 Total Amount of Taxes 50
Withheld
I declare, under the penalties o f perjury, that this certificate has been made in go o d faith, verified by us, and to the best o f o ur kno wledge and belief, is true and co rrect
PAYOR /
BY: MARIVIC A. GALBAN GACPAWITHHOLDING
CONVENTIONG– AGENT 144
WATERFRONT CEBU CITY MAY 25, 2018
BIR RECONCILIATION
FORMAT
SAWT FORMAT
ALPHA
Annex “B”
Annex “B” BIR REGISTERED NAME
TRADE NAME
BIR REGISTERED NAME ADDRESS
TRADE NAME TIN
ADDRESS
TIN MONTHLY ALPHALIST OF WITHHOLDING TAXES (MAWT)
RETURN PERIOD
RETURN PERIOD Seq TIN Registered Name Return Nature of income ATC Tax rate Tax base Tax
Seq TIN Registered Name Return Nature of income ATC Tax rate Tax base Tax 3 mm/yy 5
no. (Alphalist) period payment Withheld 1 2 4 6 7 8 9
3 mm/yy 5 1
1 2 4 6 7 8 9
1 2
2 3
4
3
5
BIR
4
TOTAL P P
5 AMOUNT
TOTAL P P
AMOUNT
• UNDER DECLARATION OF INCOME

• OVER STATEMENT OF CREDITS
• UNDER/ NON-REMITTANCE OF TAXES WITHHELD
• LATE/ NON-ISSUANCE OF CERTIFICATES
145
SALES INVOICE (SI) / Sale of GOODS
CASH INVOICE (CI) or properties
OFFICIAL RECEIPT Sale of SERVICES

(OR) or lease of goods
or properties
146
Sample Only XYZ CORPORATION
U305/3F Visayas Avenue, Quezon City “Annex C.3”
VAT Reg. TIN: 245-406-465-0000
SALES INVOICE
Sold to: _________________________________ Date: ______________
TIN: _________________________________ Terms: ______________
Address: _________________________________ OSCA/PWD ID No.: ______________
_________________________________ SC/PWD Signature: ______________
Business Style: _________________________________
QUANTITY UNIT ARTICLES UNIT PRICE AMOUNT
Total Sales (VAT Inclusive)

Less: VAT
VATable Sales Amount: Net of VAT
VAT-Exempt Sales Less: SC/PWD Discount
Zero Rated Sales Amount Due
VAT Amount Add: VAT
TOTAL AMOUNT DUE
10 Bklts (3x) 1001-1500 _______________________________

BIR Authority to Print No. 3AU000805222
Cashier/Authorized Representative
Date Issued : 07-30-13: Valid until 07-29-2018
JDC PRINTING SERVICES, INC.
Bgy. 123, Quezon City Printer’s Accreditation No.
TIN: 123-456-789-0000 P08051200
Date Issued: 08-01-12
BY: MARIVIC A. GALBAN GACPA CONVENTION – WATERFRONT CEBU CITYNo.

THIS INVOICE SHALL BE VALID FOR FIVE (5) YEARS FROM THE DATE OF ATP. 100125, 2018
MAY 147
EZG CORPORATION
Sample Only U115 G/F SM North Edsa, Quezon City
“Annex C.4”
NON-VAT Reg. TIN: 245-406-465-0000
OFFICIAL RECEIPTS
Sold to: _______________________________ Date: ______________
TIN: _______________________________ Terms: ________________
Address: _______________________________ OSCA/PWD ID No.: ____________
_______________________________ SC/PWD Signature: ______________
Business Style: _______________________________
QUANTITY UNIT ARTICLES UNIT PRICE AMOUNT
Total Sales
Less: SC/PWD-Discount
TOTAL AMOUNT DUE
_______________________________
Cashier/Authorized Representative
10 Bklts (3x) 1001-1500
BIR Authority to Print No. 3AU000805222
Date Issued : 07-30-13: Valid until 07-29-2018
JDC PRINTING SERVICES, INC. Printer’s Accreditation No.
Bgy. 123, Quezon City P08051200
TIN: 123-456-789-0000 Date Issued: 08-01-12
“THIS DOCUMENT IS NOT VALID FOR CLAIM OF INPUT TAXES” No. 1001
THIS INVOICE SHALL BE VALID FOR FIVE (5) YEARS FROM THE DATE OF ATP. 148
C O M P U T A T I O N
(V
VAT registered payee -CONTRACTOR)
NEW BILLING REQUIREMENT
VAT SEPARATELY BILLED
GROSS P100,000
ADD: 12% VAT 12,000
GROSS BILLING P112,000
less: EWT 2% x 100,000 2,000
NET AMOUNT DUE P110,000
149
C O M P U T A T I O N
(VAT registered payee- government contractor)
GROSS (exclusive of VAT) P100,000
Add: 12%VAT 12,000
Gross billing P112,000
less: a. EWT 2% x 100,000 2,000 2307 1601EQ
QAP
b. FVAT 5% x 100,000 5,000 2306 1600
NET AMOUNT DUE P105,000 ALPHA
(NON-VAT registered payee- government contractor)

GROSS billing P100,000
less:a. EWT 2% x 100,000 2,000 2307 1601EQ
QAP
b. GMP 3% x 100,000 3,000 2307 1600
NET AMOUNT DUE P 95,000 ALPHA
150
EXPANDED
WITHHOLDING
TAX
GOVERNMENT
MONEY
PAYMENTS ( 3%)
151
5% FINAL VAT
152
RR 2-2015
y Amending RR 2-2006 and 11-2013 with respect to
the submission
of copies of BIR
Form 2307 and 2316
y That SAWT submitted under RR 1-2014 using
Data Entry and validation module of
the BIR. On the other hand, in lieu of the
submission of hard copies of 2307 as an
attachment to SAWT, the following procedures
must be observed:
153
BIR Form Nos. 2307 or 2316
1. SCAN the original copies of BIR Form 2307
through a scanning machine or device;
2 Store the soft copies using pdf file format with
filenames ALPHABETICALLY ARRANGED in DVD-R.
The filename shall contain the ff: info separated by an
underline:
a. BIR registered name of the taxpayer-payor
b. TIN including branch code
c. Taxable period
Example: Bonifacio Mfg.Corp_131885220000_09312014
However, if several BIR Form 2307 same payor, same taxable period, indicate at the end
the series no.
Bonifacio Mfg.Corp_131885250000_09312014_1
Bonifacio Mfg.Corp_131885250000_09312014_2 SEVERAL TRANS.
Bonifacio Mfg.Corp_131885250000_09312014_3 IN A MONTH
154
BIR FORM NO. 2307
SWORN
155
BIR FORM NO. 2316
SWORN
156
BIR Form Nos. 2307 and 2316
y 4. Submit the DVD-R to the BIR where
registered, together with a Notarized SWORN
Certification Annex C, duly signed by the
authorized representative of the TP certifying that the
soft copies of the said form are the complete and
exact copies of the original thereof.
157
Taxpayers covered by the
amendatory provisions
yMandatory for LTS
y Any NON-LTS may, at its/his/her OPTION
comply with the said requirements
y Provided, further, that non-LTS shall NO
LONGER BE ALLOWED TO SUBMIT
IN HARD COPIES thereafter once the said TP
opted to comply with the requirements prescribed by
these Regulations
158
“SECTION 2.57.2. Income Payments Subject to
Creditable Withholding Tax.
(A)Income Payments to a CITIZEN OR TO A RESIDENT ALIEN Individual:
(A)PROFESSIONAL FEES, talent fees,

etc. for services rendered – On the gross professional, promotional,
and talent fees or any other form of remuneration for the services rendered by the
following:
Individual payee: If gross income for the current year

not exceed ₱3M - 5%
more than ₱3M - 10%
Non-individual payee:
not exceed ₱720,000 10%
exceeds ₱720,000 - 15%
159
“(1) Those individually engaged in the
practice of profession or callings;
LAWYERS CPAS
DOCTORS OF MEDICINE DENTIST
ARCHITECTS ENGINEERS
MARINE SURVEYORS DOCTORS OF VETERINARY
PROFESSIONAL APPRAISERS CONNOISSEURS OF TOBACCO
ACTUARIES INTERIOR DECORATORS
DESIGNERS REAL ESTATE SERVICE
PRACTITIONER
all other profession requiring government licensure examination
regulated by the Professional Regulations Commission (PRC),
Supreme Court, etc.
For professional fees paid to medical practitioners (includes doctors
of medicine, doctors of veterinary science and dentists) by hospitals and
clinics or paid directly by health maintenance organizations (HMOs) and/or
similar establishments [formerly under letter (I)]:
160
PF directly from patients who were
admitted and confined in hospitals/clinics
PF in the total medical bill of the patient which shall be

payable directly to the hospital or clinic.
Hospitals and clinics shall SUBMIT THE LIST containing the

names and addresses of the MEDICAL PRACTITIONERS in the
following classifications, every 15th day after the end of
each calendar quarter
161
AFFIDAVIT-DECLARATION THAT NO PROFESSIONAL FEE
HAS BEEN CHARGED BY MEDICAL PRACTITIONER
162
MEDICAL PRACTITIONERS
shall likewise include
y medical technologists,
y allied health workers (e.g., occupational therapists, physical
therapists, speech therapists, nurses, etc.)
y other medical practitioners
who are not under an employer-employee relationship
with the hospital or clinic, or HMO and other similar
establishments
163
2. Professional ENTERTAINERS
actors, actresses, singers, lyricist,
composers, emcees
3. Profession ATHLETES
basketball players, pelotaries and jockeys
4. All Directors & PRODUCERS

involved in movies, stage, radio, television
& musical productions
164
5. Insurance agents & insurance adjusters
6. Management & technical CONSULTANTS
7. Bookkeeping agents & agencies
8. Other recipient 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;
165
It shall include not only fees, but also:
per diems allowances other form of income payment
not subject to withholding tax on compensation.
In the case of professional entertainers, athletes, & all

recipients of talent fees, it shall also include the amount
paid for the of advertisements or sales promotions:
use of their names or pictures in print,
broadcast or
other media or
use for public appearances
for purposes of advertisements or sales proportion.
166
“INCOME PAYEE’S SWORN DECLARATION OF GROSS RECEIPTS/SALES
(For Self-Employed and/or Engaged in the Practice of Profession with
SEVERAL INCOME PAYORS)
167
SEVERAL INCOME PAYORS)
SWORN (Annex “B1”),

+
Certificate of
Registration (COR),
168
(For Self--Employed and/or Engaged in the Practice of Profession with Several Income Payors))
169
Not exceed 3M + non--VAT
SEVERAL INCOME PAYORS
GRADUATED INCOME TAX RATES

Section 24(A)(2)(a) of the Tax Code, as amended, based on the taxable income.
creditable withholding tax (5% with sworn; 10%);
subject to percentage tax (File 2551Q) and
will file the required percentage tax returns
or
subject to withholding percentage tax (3%),
in case of government money payments
8% income tax rate

Section 24(A)(2)(b) of the Tax Code, as amended,
based on gross receipts/sales and other non-operating income –
In lieu of:
graduated income tax rates and
Percentage Tax under Section 116 of the Tax Code, as amended;

only the CREDITABLE INCOME WITHHOLDING TAX
based on the prescribed rate shall be made (5% with sworn; 10%);
170
INCOME PAYEE’S SWORN DECLARATION OF GROSS RECEIPTS/SALES
LONE INCOME PAYOR)
171
INCOME PAYEE’S SWORN DECLARATION OF GROSS RECEIPTS/SALES
LONE INCOME PAYOR)
SWORN (Annex “B2”),

+
Certificate of
Registration (COR),
172
(For Self--Employed and/or Engaged in the Practice of Profession with LONE Income Payors)
173
INCOME PAYEE’S SWORN DECLARATION OF GROSS RECEIPTS /SALES
(For Non-Individual Taxpayer with Several Income Payors)
174
INCOME PAYORS /withholding agents shall
subsequently execute a sworn declaration (Annex “C”)
y together with the LIST OF PAYEES & NUMBER

OF PAYEES who have:
A. submitted the income payees’ sworn declarations
(Annexes “B-1”, “B-2” and “B-3”)
B. with the accompanying copies of their COR.
SUBMIT: (1) Original copy for the BIR; and

(2) Duplicate copy for lone payor/withholding agent
WHERE: BIR office where registered
WHEN: on or before January 31 of each year or
15 days following the month when a new income
recipient has submitted the payee’s sworn declaration.
175
INCOME PAYOR/WITHHOLDING AGENT’S SWORN DECLARATION
ANNEX C
176
C. RENTAL 5%
1. Real properties & personal. – On
gross rental for the continued use or
possession of real property used in business
which the payor or obligor has not taken or
is not taking title, or in which he has no
equity
177
C. Income Payment to Certain
(E)
Contractors 2%
1. GENERAL ENGINEERING CONTRACTORS
2. GENERAL BUILDING CONTRACTORS
3. SPECIALTY CONTRACTORS
4. OTHER CONTRACTORS And/or Labor-

only contractors
178
(4) Other contractors – 2%
(f) Printers, bookbinders, lithographers and publishers except
those principally engaged in the publication or printing of
any newspaper, magazine, review or bulletin which appears
at regular intervals, with fixed prices for subscription and
sale;
(g) Messengerial, janitorial, private detective and/or security
services, credit and/or collection agencies and other
business agencies;
(h) Advertising agencies, exclusive of gross payments to media;
(i) Independent producers of television, radio and stage

performances or shows;
(j) Independent producers of “jingles”;
179
TOP withholding agents
shall include the following:
a. Classified and duly notified by the Commissioner

as either any of the following unless previously de-classified as such
or had already ceased business operations:
(1) LARGE TAXPAYER under RR 1-98, as amended;
(2) Top 20,000 private corporations under RR No. 6- 2009;

or
(3) Top 5,000 individuals under RR No. 6-2009;
b. Taxpayers identified and included as

y Medium Taxpayers, and
y Taxpayer Account Management Program (TAMP)
180
(J) Income Payments made by a GOVERNMENT OFFICE,
national or local, including barangays, or their attached agencies or
bodies, and government-owned or controlled corporations to its
local/resident supplier of goods/services, other than those covered by
other rates of withholding tax. [formerly under letter (N)]
to its local/resident supplier of goods

and local/resident supplier of services
other than those covered by other rates
of withholding tax
1% PURCHASE OF GOODS
2% PURCHASE OF SERVICES
* GOCCs shall withhold in their
capacity as government.
181
(N) Income payments made to suppliers of
AGRICULTURAL PRODUCTS [formerly under letter (S)] –
y – Income payments made to AGRICULTURAL SUPPLIERS such as

those, but not limited to,
y payments made by hotels, restaurants, hotels, restaurants, resorts, caterers,
food processors, canneries, supermarkets, livestock, poultry, fish and marine
product dealers, hardwares, factories, furniture shops, and all other
establishments, in excess of the cumulative amount of
₱300,000.00 within the same taxable year. - 1%
“A
AGRICULTURAL SUPPLIERS” refers to suppliers/sellers of agricultural, forest
and marine food and non-food products, livestock and poultry of a kind generally used
as, or yielding or producing of foods for human consumption; and breeding stock and
genetic materials therefor.
“LIVESTOCK” shall include cow, bull and calf, pig, sheep, goat and other animals
similar thereto.
“POULTRY” shall include fowl, duck, goose, turkey and other animals similar thereto.
MARINE PRODUCTS” shall include fish and crustacean such as but not limited to,
eel, trout, lobster, shrimp, prawn, oyster, mussel and clam, shell and other aquatic
products.
182
O)Income payments on PURCHASES OF MINERALS,
MINERAL PRODUCTS AND QUARRY RESOURCES
as defined and discussed in Section 151 of the Tax Code
[formerly under letter (T)]
y Income payments on purchases of minerals, mineral products, and

quarry resources such as but not limited to silver,
gold,
marble, granite, gravel, sand, boulders and other
materials/products. – 5%
y However, BSP is required to withhold 1% of gross payments
made, and remit the same to the Government.
(P) MERALCO Payments on the following [formerly under letter (U)]:

( Q) Interest income on the refund paid either through direct
payment or application against customers’ billings by other electric Distribution
Utilities (DUs) in accordance with the rules embodied in ERC Resolution No. 8,
Series of 2008, dated June 4, 2008, governing the refund of meter deposits …
[formerly under letter (V)] - xxx
183
(R) Income payments made by POLITICAL PARTIES
AND CANDIDATES of local and national elections on
all their PURCHASE OF GOODS AND SERVICES related
to campaign expenditures, and income payments made by individuals
or juridical persons for their purchases of goods and services intended
to be given as campaign contributions to political parties and candidates
[formerly under letter (X)] – 5%
(S) INTEREST INCOME derived from any other debt instruments
not within the coverage of ‘deposit substitutes’ and Revenue
Regulations 14-2012, unless otherwise provided by law or regulations
[formerly under letter (Y)] – 20%
(T) Income payments to Real Estate Investment
Trust (REIT) [formerly under letter (Z)] – Income payments made to corporate
taxpayers duly registered with the LTS Regular LT Audit Division as REIT for
purposes of availing the incentive provisions of Republic Act No. 9856,
otherwise known as “The Real Estate Investment Trust Act of 2009”, as implemented
by RR 13-2011 - 1%
184
y Any income subject to INCOME TAX
may be subject to WITHHOLDING TAX;
y However, INCOME EXEMPT from

income tax is consequently
EXEMPT FROM WITHHOLDING TAX.
y Further, income not subject to withholding

tax does not necessarily mean that it is
not subject to income tax.”
185
Returns and Payment of Taxes
“SECTION 2.58.
Withheld at Source
BIR Form No. 1601EQ for creditable withholding tax Not later than the
last day of the
BIR Form No. 1602Q for final tax on interest on bank month following
deposits
the close of the
BIR Form No. 1603Q for final tax withheld on fringe benefits, quarter during
which the
BIR Form No. 1601FQ for all other final withholding taxes) withholding was
made.
QUARTERLY Alphabetical List of Payees (QAP)

y NAME OF INCOME PAYEES,
y Taxpayer Identification Number (TIN),
y AMOUNT OF INCOME PAID
y SEGREGATED PER MONTH
y WITH TOTAL FOR THE QUARTER
(ALL INCOME PAYMENTS prescribed as subject to withholding tax under
these regulations, whether actually subjected to withholding tax or
not subjected due to exemption), and
y TOTAL AMOUNT OF TAXES WITHHELD, if any.
186
187
Considering that taxes withheld by the withholding agents are
C
HELD IN TRUST FOR THE GOVERNMENT and its availability is
an imperious necessity to ensure sufficient cash inflow to the National
Treasury, withholding agents shall file
BIR Monthly Remittance Form

(BIR Form No. 0619E and/or 0619F)
y every tenth (10th) day of the following month
when the withholding is made, regardless of the amount withheld.
For withholding agents using EFPS facility,

the due date is on the 15th day of the following month.
Withholding agents with zero remittance are still required to use and file
the same form.
188
189
1st mo 2nd mo
190
191
1st mo 2nd mo
192
TAX ADVISORY 4/24/18
Alphabetical List of Payees (QAP)

y ln line with the submission of the Quarterly
Alphabetical List of Payees (QAP)
that shall accompany the
y Quarterly Remittance Return of Creditable Income
Taxes Withheld (Expanded) BIR Form No. 1601-EQ]
y Quarterly Remittance Return of Final Income Taxes
Withheld (BIR Form No. 1601-FQ),
please be informed that the Alphalist Data Entry and
Validation module Version 6.0 is now available for use.
This can be downloaded from the Bureau's
website at www.bir.gov.ph, as follows:
193
QAP
ALPHALIST DATA ENTRY MODULE VER 6
1. CLICK on the "Downloadables" button

at the lower left side of the web page;
2. SCROLL DOWN to search the section
showing the "Alphalist Data Entry and
Validation Module Version 6.0 (ver)";
and
3. Follow the instructions stated on the said
section to install the module.
194
QAP SUBMISSION
The QAP shall be submitted either
1. through the eSubmission facility
(esubmission@bir.gov.ph) of the
Bureau or
2. through the dedicated email account of the RDO
having jurisdiction over the withholding agent's
registered address.
This is required to be submitted on or before the last
day of the month following the close of the
quarter as an "ATTACHMENT" to the quarterly
withholding tax returns prescribed under Revenue
Regulations No. 11-2018, as amended
195
Tax advisory
196
REGISTRATION COR
y Thus, the concerned taxpayers need not visit
their respective RDO to UPDATE THEIR
REGISTRATION and replace their Certificate of
Registration (COR)
y A separate advisory shall be issued for taxpayers

under LTS & Region 8 - Makati to the new form
types.
197
B) Withholding Tax Statement for
Taxes Withheld
Every payor required to deduct and withhold taxes under this subsection
shall furnish each payee, a withholding tax statement,
IN TRIPLICATE,
y TIME: within 20 days from the close of the quarter
y upon request of the payee, the payor must furnish such statement,
simultaneously with the income payment
y FORM: BIR Form No. 2307 for creditable withholding tax
BIR Form No. 2306 for final withholding tax
SHOWING:
y monthly income payments made,
y quarterly total, and
y amount of taxes withheld.
198
199
1. BIR Form Nos. 1601-EQ/1601-FQ
A. Manual Return
4. Remittance of the tax due thereon, if any, shall be made
thru:
a. Manual Payment
y Authorized Agent Bank (AAB) located within the territorial jurisdiction
of the Revenue District Office (RDO) where the taxpayer is registered
y In places where there are no AABs, the return shall be filed and the tax
due shall be paid with the concerned Revenue Collection Officer
(RCO), thru the MRCOS facility, under the jurisdiction of the RDO.
b. Online Payment
1. Thru GCash Mobile Payment
2. Landbank of the Philippines (LBP) Linkbiz Portal, for taxpayers
who have ATM account with LBP and/or holders of Bancnet ATM/Debit
Card
3. DBP Tax Online, for holders of VISA/Master Credit Card and/or
Bancnet ATM/Debit
200
SYSTEM DOWN
RETURN NOT AVAILABLE IN efps
201
(C) ANNUAL Alphabetical Information Return and
Annual List of Payees for income tax withheld at source
The withholding agent is required to file with the concerned office of the
LTS/RR/RDO where the withholding agent is registered, the following:
1. (BIR FORM NO. 1604E)
Annual Information Return of Creditable Taxes Withheld (Expanded)
/Income Payments Exempt from Withholding Tax including the
corresponding Annual Alphabetical List of Payees –
y on or before March 1 of the following year in which payments were
made; and
2. (BIR Form 1604F) Annual Information Return on Final

Income Taxes Withheld including the
corresponding Annual Alphabetical List of Payees –
y On or before January 31 of the following year in which payments were
made.”
202
When and Where
to File and Pay
For Electronic
• e-filed and e-paid on or before the DEADLINE
http://www.bir.gov.ph.
203
DOWNLOADABLES
1.1. www.knowyourtaxes.ph
1.2. www.dof.gov.ph
1.3. Dropbox : http://goo.gl/UCr8XS
1.4. www.bir.gov.ph
204
Step 1.
DOWNLOAD, INSTALL and RUN
eBIRForms Package version
Step 2.
FILL-UP directly by encoding data in tax return
Step 3.
Click VALIDATE after accomplishing tax return.
If there are changes to make, click EDIT button.
Make sure to validate after every changes made.
Step 4.
Click SUBMIT / FINAL COPY
205
Penalties for Non-Compliance
•LATE FILING
Non-withholding
Under withholding
Under remittance
Failure to refund excess taxes
withheld on compensation
• overwithholding
• overremittance
206
OFFICERS & EMPLOYEES
REQUIRED TO DEDUCT & WITHHOLD
BARANGAY BARANGAY BARANGAY
TREASURER CAPTAIN
MUNICIPALITIES MUNICIPAL CHIEF MAYOR

/ CITIES /CITY ACCOUNTANT
TREASURER
PROVINCES PROVINCIAL CHIEF GOVERNOR
TREASURER ACCOUNTANT
DEPARTMENTS CHIEF HEAD OF

BUREAUS ACCOUNTANT OFFICE
GOCCS (Official holding the
OTHER GOVT highest position such as
Secretary, Regional
OFFICES Director, etc.)
207
208
Presented by
y:
MARIVIC A. GALBAN
Email:
il: marivic.galban@bir.gov.ph
marivic.galbanwtd@yahoo.com
Queries? –
VISIT THE NEAREST BIR REGIONAL OFFICES OR REVENUE DISTRICT OFFICES
Pls. call BIR Call Center

http://www.bir.gov.ph
209

Tax Reform and Rates under TRAIN Law

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Copyright:

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Tax Reform and Rates under TRAIN Law

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PRESENTED BY:

Sustainable Budget Secure Enhance

Tax & Tax policy Improve

CAUSE EFFECT OUTCOME

BY: MARIVIC A. GALBAN GACPA

BASIC AMOUNT ADDITIONAL OF EXCESS OVER

• Personal exemption • No more personal and

• SALE OF GOODS TO • 12% with enhanced VAT

• VAT exempt sale of residential

• VAT exempt - lease of • P15,000

• Self-employed & • Jan. 1, 2019 if annual gross

• DEFICIENCY INTEREST • DOUBLE THE LEGAL INTEREST RATE

PURELY COMPENSATION income

¾ employee’sshare in the SSS, GSIS, PHIC, HDMF

y if any income cannot be definitely attributed to or

y one who engages in some art or sport for money,

is also subject to the applicable BUSINESS TAX, if any

GRADUATED INCOME TAX + VAT

PURELY SELF-EMPLOYED INDIVIDUALS AND/OR

1. The GRADUATED RATES under Section 24(A)(2)(a) of the

Tax Code, as amended; (20% to 35%)

¾ UNLESS THE TAXPAYER SIGNIFIES

of the taxable year, the intention to elect the 8% income tax

IRREVOCABLE FOR THE TAXABLE YEAR

Taxpayers who are subject to

HAVE NO OPTION TO AVAIL OF THE 8%

1. Those subject to Other Percentage Taxes

2. Partners of a General Professional

GROSS QUARTERLY SALES

2. shall also be subject to the applicable

COMPENSATION + PRACTICE OF PROFESSION

COMPENSATION + OTHER SOURCES ASIDE FROM

-A Withholding agent can be an

To deduct and withhold

To remit the tax withheld

BIR Form No. 1903 GOVERNMENT AGENCIES / LGUs

WHEN: ON OR BEFORE COMMENCEMENT OF BUSINESS/

WHERE: Revenue District Office

ALL EMPLOYEES MUST fill-up:

y Prescribe policies and guidelines in the

d. Rice subsidy of P2,000 or one (1)

j. Daily meal allowance for

Section 2.33 (c) of RR 3-98, as amended

Thus, the official and employees of the barangays

y Refund excess withholding tax to employees, if any

Reminder: Non-processing of TAX REFUND

Step 1. Determine monetary and

Segregate the taxable from the

Note: RATA & PERA granted to public officers and

Step 2. Use the appropriate table in Annex "A"

Step 4.. Compute the withholding tax due

. Compute the withholding tax due by adding

compensation in the amount of P15,500, net

a. Cumulative Average Method

Alphalist of employees submitted to BIR

4. A minimum wage earner as defined in these

at any time during the taxable year, are not

y Refer to those individuals who are not identified under

CIVIL SERVICE COMMISSION

hiring individual workers on contract of

THIS SITUATION GAVE RISE TO THE FOLLOWING ISSUES:

y In view of the foregoing, there is a need to clarify the

6.1.1 Institutional Contact of Service covers lump

GRADUATED INCOME TAX RATES

8% income tax rate

Percentage Tax under Section 116 of the Tax Code, as amended;