Congratulations! You registered your business with the BIR ! But then moments after you get your Certificate of Registration (BIR Form 2303) , you are then filed with confusion as you are now informed that you are now REQUIRED (yes, IT IS A MUST) to file and if applicable pay your taxes.
So how? Well, let us help you on what, how and when to pay taxes.
First, what taxes do you need to file and pay?
So before you get sleepless nights on figuring out on how to file, it is first important to know what kind of taxes do you need file (and pay, if applicable).
To know that, you just have to check your Certificate of Registration/COR (BIR Form 2303, the orange-y or sometimes bluish cardboard paper ) issued to you as proof you are indeed a registered business/entity with the BIR.
So once you have the COR in your hand look for the tax types indicated in your COR (as seen in the photos below)
So in our case we are required to file (and pay if applicable) the following taxes:
- Income Tax
- Value Added Tax
- Withholding Tax
- Registration Fee
- Withholding Tax -Expanded
- Withholding Tax – Compensation
(Will go through the details of each tax type in a separate blog)
Q: Do I still need to file the tax returns stated in the COR even if it will end up to zero (or sometimes negative) amount ?
Q: What happens if I forget to file the tax returns?
A: PENALTIES and INTEREST!
Now that you know what taxes to file and how important to file them, we now go to the second question.
When do you need to file your tax returns?
So you may check the lower part of your COR (if its the orange COR was issued to you) or the first page if it is the blue COR (see photos below):
Aside from the deadline the COR will also guide you on what form to use for each tax type.
Now the ultimate question.
How can you file and pay your tax returns?
The BIR has recently issued Revenue Memorandum Circular (RMC 4-2021) giving guidance to all taxpayers and concerned individuals on how to file and pay taxes.
The BIR enumerated two methods in filing you returns which are:
You have to manually fill up and sign the return and pay either thru an Authorized Agent Bank (AAB) or the Revenue Collections Officer (RCO)
Who may file manually?
Taxpayers who are not required or did not opt to file electronically.
How to pay your taxes?
The payment if manually filed will be thru
1.An Authorized Agent Bank (AAB)under the jurisdiction of the concerned Revenue District Office (RDO) where the taxpayer is registered.
Reminder you can’t just pay in any bank that is nearest to you. It must be one a bank duly authorized by the RDO where your business is located. For the list of AAB’s per RDO check it here (https://www.bir.gov.ph/index.php/list-of-authorized-agent-banks.html)
2. Thru the Revenue Collection Officer (RCO) under the RDO where the taxpayer is registered through the Mobile Revenue Collection Officer System (MRCOS) in areas where there are no AABs. However, you may only pay a maximum amount of Php 20,000 per tax type if paid thru cash. If payment is thru check there is no limit as to payment.
However, in the same RMC , the BIR encourages the taxpayers to file their tax returns electronically.
Electronical filing is done by submitting the tax returns online thru either:
- eBIR Forms
- You just need to download and install the latest version of the eBIRforms (version 7.7 -as of writing) in the BIR website (https://www.bir.gov.ph/) -see photo below
Who may file thru eBIRForms?
Any taxpayer can VOLUNTARILY choose to file thru eBIRForms. There are however certain taxpayers who are REQUIRED to file using eBIRForms these are:
- Top Withholding Agents
- Accredited Tax Agents/Practitioners and all its client-taxpayers
- Accredited Printers of Principal and Supplemental Receipts/Invoices
- One-Time Transaction (ONETT) taxpayers who are classified as real estate dealers/developers; those who are considered as habitually engaged in the sale of real property who are using/filing BIR Form No. 1606 together with the BIR Form No. 2000OT and regular taxpayers already covered by eBIRForms.
- Those who shall file a “No Payment Return” –
- Government-Owned-or-Controlled Corporations (GOCCs)
- Local Government Units (LGUs), except barangays
- Cooperatives registered with National Electrification Administration (NEA) and Local Water Utilities Administration (LWUA)
How do you pay your taxes if filed thru eBIRForms?
- Authorized Agents Banks (AABs) under the jurisdiction of the concerned Revenue District Office (RDO) where the taxpayer is registered.
- Revenue Collection Officers (RCOs) under the RDO where the taxpayer is registered through the Mobile Revenue Collection Officer System (MRCOS) in areas where there are no AABs.
- Electronic Paynent:
- Development Bank of the Philippines’ (DBp) pay Tax online (for holders of Visa/Mastercard Credit Card and/or BancNet ATM/Debit Card)
- Land Bank of the Philippines’ (LBp) Link.Biz portal (for taxpayers who have ATM account with LBp and./or horders of BancNet ATM/Debit/prepaid card or taxpayer utilizing PESoNet facility for depositors of RCBC, Robinsons Bank and Union Bank)
- Union Bank online web and Mobile Payment Facility (for taxpayer who has an account with Union Bank of the Philippines)
- Mobile Payment (GCash/payMaya)
For instructions on how to pay your taxes ONLINE. You may download it here:
Taxpayer who has an account with the following BancNet participating banks can use their ATM Card in paying taxes online with LBP’s Link.Biz Portal and DBP’s Pay Tax Online:
|1.Asia United Bank||7. Entrepreneur Bank||13. Philtrust Bank|
|2.BPI Direct BanKo||8. Equicom Savings Bank||14. Sterling Bank of Asia|
|3.CTBC Bank||9. MASS SPECC||15. Sun Savings Bank|
|4. Citystate Savings Bank||10. Philippine Band of Communications||16. Tiaong Bank|
|5.Development Bank of Philippines||11. Phil. Postal Savings Bank|
|6. Enterprise Bank||12. Philippine Veterans Bank|
We will be having a seminar on the step by step procedure on how to file each tax type in the following months beginning February 🙂
2. Electronic Filing and Payment System (eFPS)
A taxpayer can also file via eFPS via this website (https://efps.bir.gov.ph/)
Who may file thru eFPS?
Any taxpayer can VOLUNTARILY choose to file thru eFPS. There are however certain taxpayers who are REQUIRED to file using eFPS these are:
|Taxpayer under Taxpayer Account Management Program (TAMP)||Government Offices, in so far as remittance of withheld VAT and business tax is concerned|
|Accredited Importer and Prospective Importer||Government Bidders|
|National Government Agencies (NGAs)||Insurance Companies and Stockbrokers|
|All Licensed Local Contractors||Large Taxpayers|
|Enterprises enjoying Fiscal Incentives (PEZA, BOI, Various Zone Authorities, Etc.)||Top 20,000 Private Corporations|
|Top 5,000 Individual Taxpayers|
|Corporations with Paid-Up Capital Stock of P l0 Million and above|
|Corporations with Complete Computerized Accounting System (CAS)|
However to be able to use the eFPS platform the taxpayer must first apply with their respective RDO.
How do you pay your taxes if filed thru eFPS?
For taxpayers using eFPS to file the return electronically and pay the corresponding taxes due thereon through the eFPS-AABs where they are enrolled. Taxpayers enrolled in the eFPS may enroll and maintain their account with any of the following eFPS-AABs:
|1. Bank of Commerce||12. MUFG Bank (Formerly Bank of Tokyo-Mitsubishi UFJ. Ltd.)|
|2. Bank of the Philippine Islands (BPI)||13. Philippine Bank of Communications (PBCom)|
|3. China Banking Corporation (CBC)||14. Philippine National Bank (PNB)|
|4. Citibank, N.A.||15. Philippine Veterans Bank|
|5. CTBC Bank (Formerly Chinatrust Bank)||16. Philippine Trust Company (Philtrust Bank)|
|6. Deutsche Bank||17. Rizal Commercial Banking Corporation (RCBC)|
|7. Development Bank of the Philippines (DBP)||18. Security Bank Corporation|
|8. Eastwest Banking Corporation||19. Standard Chartered Bank|
|9. Hongkong and Shanghai Banking Corporation (HSBC)||20. Union Bank of the Philippines|
|10. Land Bank of the Philippines (LBP)||21. United Coconut Planters Bank (UCPB)|
|11. Metropolitan Bank and Trust Company (Metrobank)|
Hope this helps you in your tax compliance. Do file regularly to avoid penalties.
You may download the full text of RMC 4-2021 here:
Should you need assistance in filing and paying your taxes, Wania and Partners can help you may reach us thru our :email (email@example.com) , Facebook Page , or contact us page. Experience growth in your company when you outsource your tax compliance with Wania and Partners.
By: John Paul Wania, CPA/Keith Aquino