Search This Blog

Tuesday, April 8, 2014

File your Income Tax Returns On or Before April 15

BIR Keeps April 15 Deadline, urges taxpayers to file early to avoid long lines 



Bureau of Internal Revenue Commissioner Kim Jacinto-Henares reminds all Filipinos that the BIR is keeping its April 15 deadline for filing their income tax returns (ITR) despite falling within the Holy Week.

Failure to submit their ITRs, Henares says will result in a penalty of 25 percent and 20 percent interest per annum.

Income tax is a portion of the gross income that is taxed by the government. The ITR breaks down the respective deductions from the gross income to arrive at the income tax that must be paid.
The BIR chief hopes that with its reinforced campaign against tax cheats, taxpayers would file and pay their correct taxes this time.

“We’ve been very consistent with the actions that we’re taking, it’s not just a flash in the pan. Hopefully people would take that very seriously,” Henares said in a news report.
It is the duty of all income earning Filipino citizens—including employees, self-employed and big business—to settle their tax obligations, which account for the bulk of government revenues.
The basic obligation of everyone is to pay taxes and the orderly way of paying taxes is through the filing of tax returns.

The BIR is tasked to collect a record P176.51 billion in taxes next month, higher by 18 percent compared with its above-target P148.99-billion revenues in the same month last year.
With its reinforced drive Henares, meanwhile, is hopeful BIR could again exceed the year’s largest monthly collection goal in April, where also deadline for filing ITRs falls.
Last April 2013, the BIR surpassed its target by 4.4 percent and registered a 28 percent year-on-year growth. This year, the BIR is tasked to collect another record P1.456 trillion in taxes, higher by 19 percent compared with its actual revenue take last year.

Learn more about Taxation with this FAQ from GMA NEWS ONLINE 

1. What constitutes taxable income?
According to the amended Tax Code, or the National Internal Revenue Code, taxable income refers to the items of gross income without the personal exemptions and other forms of deductions. (See No. 2)
Gross income includes compensation for services, such as fees, salaries and commissions; income   from business, trade or exercise of profession; interests; rent; royalties; and prizes.
Not included in gross income are life insurance, compensation for illness or sickness, and retirement benefits.
The basic categories of taxable income are compensation income (payments for  employer-employee relationship in the form of wages and salaries), business, trade and professional income (outside the employer-employee relationship), and passive income (interests from foreign and local currency bank deposits, royalties, prizes, dividends, and capital gains from shares of stock.)
Incentives—such as 13th month pay, bonuses, and other benefits—are not taxed separately from the gross income.

2. What are gross income deductions?
Only premium payments for health and hospitalization are excluded from the gross compensation income of individuals.
Deducted from the gross business and professional income are expenses paid for business or trade, including wages, salaries, and benefits of employees. Also deducted are interest on debt, taxes paid—except income tax—losses from transactions in shares of stock, depreciation or wear and tear of property, and charitable contributions.
No deductions are made under passive income.

By law employees, businesses and professionals are entitled to personal and additional exemptions.

Singles and married couples as well as those who are single or legally separated but supporting others under 21 years old or those physically or mentally challenged are entitled to a personal exemption valued at P50,000.

Individuals may also get a P25,000 additional exemption for each legitimate, illegitimate or legally adopted child as long as number of dependents do not exceed four.

3. Where can employees get a refund for excess payment of income tax?
Tax refunds must be coordinated with employers and not with the BIR.
Taxpayers may use that refund to pay their next income tax, or they may not pursue the refund so it could be used as additional government fund.

4. Who may file their income tax returns?
Resident or non-resident citizens as well as expatriates who receive income from sources in the Philippines are required to submit their ITR.
Domestic corporations which generate income within and outside the Philippines, as well as foreign firms earning within the country, are also required by law to file an ITR.

5.  Who are not required to file their ITRs?
Exempted from filing ITRs are minimum wage earners, an individual whose gross income is not more than his or her total personal and additional exemptions, those whose income has been subjected to a final withholding tax, and those qualified under “substituted filing.”
A withholding tax is “prescribed on certain income payments and is not creditable against the income tax due of the payee on other income subject to regular rates of tax for the taxable year,” according to the bureau.
Overseas Filipino workers do not earn their income within the country and are thus exempted from filing an ITR.
For more detailed explanations check out http://www.bir.gov.ph/taxinfo/tax_income.htm

1 comment:

  1. Thanks for sharing this site, it is very informative for the business accounting. Keep on continuing with this. I also provides this service visit the site. Income Tax Returns Intouch Accountants aims to provide an affordable, timely, clear and concise accounting service for small and medium businesses.

    ReplyDelete

Discover How the Infinix NOTE 40 Pro+ 5G Series Merges Style with Functionality for Stylish Adventures

We took the Infinix NOTE 40 Pro+ 5G out for a spin at the bowling alley to test its 100W Fast Charging and 20W Wireless Charging capabilitie...