Overview on the Taxability of Constructors. Presented by: Susan D. Tusoy, CPA, MPS Asst. Chief, Assessment Division Revenue Region 19, Davao City. It is impossible to begin to learn that which one thinks one already knows. - Epictetus. Things to consider i n the conduct of your Business.
Susan D. Tusoy, CPA, MPS
Asst. Chief, Assessment Division
Revenue Region 19, Davao City
It is impossible to begin to learn that which one thinks one already knows.- Epictetus
Things to consider already knows.
in the conduct
of your Business
STAGE 1 STAGE 2
Issuance of TIN
Registration of books,
Issuance of ATP, CAS
All of the above to be done within 30 days from date of registration
REGISTRATION FEES already knows.
INCOME TAX already knows.
Income Tax – 2%
Earnings Tax – 10%
Percentage Tax already knows.
Value-Added Tax already knows.
In the course of trade/business already knows.
Leases goods or properties (including deemed sales)
Whether or not it the course of trade or business
provided the aggregate sales/receipts exceeds P1.5MTransactions subject to VAT
Output Tax ( Sales x 12%) - P x x x
Less Input Tax (Purchases x 12%) - x x x
VAT payable - P x x x
Rules on Gross Receipts already knows.
refers to the total amount of money or its equivalent representing the contract price, compensation, service fee, rental or royalty, including the amount charged for materials supplied with the services and deposits applied as payments for services rendered and advance payments actually or constructively received during the taxable period for the services performed or to be performed for another person, excluding the VAT.
Output Tax (12%) - P 12,000
Less: Standard Input (7%) - 7,000
VAT Payable - P 5,000
Less: Withholding Tax (5%) - 5,000
VAT Payable P -0-
Excise Tax already knows.
Withholding Tax on Wages already knows.
(on Minimum Wage Earners)
Compensation income of MWEs who work in the private sector and being paid the Statutory Minimum Wageapplicable to the place where he is assignedare exempted from Income Tax and consequently from Withholding Tax
An employee who receives additional compensation other than SMW, holiday pay, overtime, hazard pay, and night shift differential pay such as:
And other taxable income
shall not enjoy the privilege of being a WME.
MWEs receiving other income from business or practice of profession, except income subject to Final Tax, shall be subject to Income Tax on their entire income
SMW, Holiday pay, overtime pay, night shift differential pay, and hazard pay shall still be exempt from WT
the amount paid by the employer to MWEs
Actually assigned to danger or strife-torn areas
Distressed or isolated stations and camps
which exposed them to great danger or contagion or peril to life
Any hazard pay paid to MWEs which does not satisfy the above criteria is deemed subject to IT and consequently to WT.
The employer shall attach to BIR Form 1601C for the months of March, June, Sept., and Dec.
A copy of the List submitted to the nearest DOLE Regional/Provincial Office showing
the names of the MWEs who received the hazard pay;
period of employment;
amount of hazard pay per month; and
Justification of payment of hazard pay
Any reduction or diminution of wages for purposes of exemption from Income Tax shall constitute misrepresentation and therefore, shall result to automatic disallowance of expense on the part of the employer.
Expanded Withholding Taxes already knows.
Withholding Tax on Government Money Payments already knows.
availed your services for the construction of a waiting
shed with a contract price of P224,000.00.
Compute for the withholding taxes assuming the contractor is:
a) Non-VAT registered taxpayer
b) VAT registered taxpayer
Fringe Benefit Tax already knows.
7. Expenses for foreign travel;
Fringe Benefits Granted to the Employee (Except Rank and File Employee) – 32%
on the grossed-up monetary value of fringe benefits granted or furnished by the employer to his employees.
Exception: File Employee) – 32%
if the fringe benefits are required by the nature of or necessary to the trade, business or profession of the employer, or where such fringe benefit is for the convenience and advantage of the employer shall not be subject to the fringe benefits tax.
WITHHOLING TAX REMITTANCE File Employee) – 32%
WITHHOLDING TAX CERTIFICATES File Employee) – 32%
ANNUAL RETURNS File Employee) – 32%
TP needs to file a return even when there’s no tax due to pay for every tax type he registered.
TCVD: Tax Compliance Verification Drive (Tax mapping)
TCVD: Tax Compliance Verification Drive (Tax mapping) File Employee) – 32%Original COR and the ARN must be conspicuously displayed in the place of business and/or office
Accomplish Form 1905 and submit
to your home RDO for:
than those w/ whom return is
required to be filed.
RELIEF – Reconciliation of Listings for
Enforcement resulting to Letter
TRS – Tax Reconciliation System using 1604-E
resulting to letter notices (LNs)
Tax Compliance Verification Drive (TCVD) - Tax Mapping Operations
Compliance Enhancement – eFPS, e-REG, e-complaints, e-DST, e-submission, e-TIS, etc.
It's what you learn after you know it all that counts. File Employee) – 32%- John Wooden
The end.... File Employee) – 32%