They say the secret to getting ahead is getting started. With 2017 fast approaching, it is definitely wise to start jotting down things to do when the new year rolls around.
While most people are making their list of New Year’s Resolutions – from vowing to eat healthier to promising to quit a bad habit – taxpayers may also want to consider listing down some important reminders to ensure compliance with their tax obligations this coming new year:
Annual registration with the Bureau of Internal Revenue (BIR) (January 31, 2017) – An annual registration fee amounting to P500 should be paid on or before the last day of the first month of the year. This is filed and paid using the BIR Payment Form No. 0605.
Annual business permit renewal with Local Government Units (LGU) (January 20, 2017) – This includes barangay clearance, community tax certificate, fire safety certificate, and payment of local business tax (LBT), mayor’s permit fee, sanitary fee, garbage fee, signboard fee, engineering fees and other charges as imposed by various LGUs.
For the payment of LBT, the basis is gross receipts. Thus, for taxpayers using the accrual method of accounting, the revenue reported in their Audited Financial Statements (AFS) may not necessarily be the basis for computing LBT as it includes income earned but not actually or constructively received. This is an important factor to consider when making sure that the proper LBT is imposed by the LGU. Moreover, taxpayers registered with the Philippine Economic Zone Authority (PEZA), pursuant to PEZA Law, are exempt from paying LBT whether they enjoy Income Tax Holiday (ITH) incentives or are under the 5 percent gross income tax regime. Some LGUs, however, have a memorandum agreement with PEZA that allows them to impose mayor’s permit and other regulatory charges on PEZA-registered taxpayer’s income derived from activities outside of their registered activity and/or on local sales exceeding the 30 percent threshold.
Monthly filing of Documentary Stamp Tax (DST) returns for the month of December 2016 (January 5, 2017) – This is filed using DST Declaration/Return (BIR Form No. 2000) or DST Declaration/Return (One Time Transactions) (BIR Form No. 2000-OT).
Monthly filing of withholding tax returns with corresponding Monthly Alphalist of Payees (MAP) for the month of December 2016 (January 15, 2017) – This comprises Withholding Tax on Compensation (WTC), filed using BIR Form No. 1601-C; Expanded Withholding Tax (EWT), filed using BIR Form No. 1601-E; Final Withholding Tax (FWT), filed using BIR Form No. 1601-F; Final Withholding Value-Added Tax (FVAT), filed using BIR Form No. 1600; and Final Income Taxes Withheld on Interest Paid on Deposits and Yield on Deposit Substitutes/Trusts/etc., filed using BIR Form No. 1602.
These withholding taxes are due on or before January 15, 2017 except for FVAT, which is due on or before January 20, 2017. Note, however, that for e-Filing and e-Payment System (eFPS) filers, the filing deadlines are based on their respective tax groupings (i.e., on or before January 11, 12, 13, 14, and 15 for eFPS filers under Group E, D, C, B and A, respectively). This is also with the exception of FVAT, which, as previously mentioned, is due on or before January 20, 2017.
Quarterly filing of Fringe Benefit Taxes (FBT) for the calendar quarter ending December 31, 2016 (January 10/15, 2017) – This is filed using Quarterly Remittance Return of Final Income Taxes Withheld (BIR Form No. 1603). For eFPS filers, due date is on or before January 15, 2017, while for non-eFPS filers, the deadline is on or before January 10, 2017.
Filing of Monthly or Quarterly Value-Added Tax Return (BIR Form No. 2550-M/Q) (January 20/25, 2017) – A monthly return is applicable for taxpayers with fiscal quarters not coinciding with calendar quarters (i.e., fiscal quarters ending in months other than March, June, September, and December). Said monthly return is due for filing on or before January 20, 2017 for non-eFPS filers, while for eFPS filers, due date is based on their respective tax groupings (i.e., on or before January 21, 22, 23, 24, and 25 for eFPS filers under Group E, D, C, B and A, respectively).
On the other hand, a quarterly return is applicable for taxpayers with fiscal quarters ending in March, June, September, or December. Filing deadline for the quarterly return is on or before January 25, 2017 for both eFPS and non-eFPS filers. Moreover, the Summary List of Sales, Purchases and Importation (SLS, SLP, and SLI, respectively), as applicable, must be attached to the quarterly return.
Refund of excess tax withheld on compensation by employer, whether private or government, as a result of the year-end adjustments for calendar year ending December 31, 2016 (January 25, 2017) – These year-end adjustments pertain to the annualization of individual income taxes at the end of the calendar year.
Annualization is the process by which an employer computes employees’ income for an entire year to determine who are eligible for a refund and who will have additional tax deductions. For those who are eligible for tax refunds, they must receive their refunded excess taxes on or before January 25, 2017. Otherwise, their employers shall be liable to corresponding penalties pursuant to existing tax issuances.
Filing of Annual Information Return of Income Taxes Withheld on Compensation and Final Withholding Taxes (BIR Form No. 1604-CF) for calendar year 2016 (January 31, 2017) – This information return summarizes the taxes remitted to the BIR for calendar year 2016. Alphalists containing the names of all payees for the applicable taxes (e.g., WTC, FBT, etc.) must be attached.
Distribution of Certificates of Income Payment/Tax Withheld (BIR Form No. 2316) of employees for calendar year 2016 (January 31, 2017) – All employees, including those who qualify for substituted filing or as minimum wage earners (MWE), must be provided with a copy of their corresponding BIR Form No. 2316 on or before 31 January 2017.
Registration of books of accounts for the calendar year ending December 31, 2016 (January 15/30, 2017) – For permanently bound computer-generated/loose-leaf books of accounts and other accounting records such as, but not limited to, receipts and invoices, together with the affidavit/certificate under oath as to type of books, number of pages/leaves used, and volume number, the registration deadline is on or before January 15, 2017. On the other hand, registration of computerized books of accounts and other corresponding accounting records must be done on or before January 30, 2017.
Submission of inventory list for the calendar year ending December 31, 2016 (January 30, 2017) – Within 30 days after the close of the taxable year, an inventory list of finished goods, work-in-progress, raw materials, supplies, and stock-in trade are required to be filed with the BIR.
I hope this rundown of tax deadlines will help taxpayers keep closer tabs on their tax obligations not only at the start of the year, but all throughout 2017. After all, being a more responsible taxpayer is a good goal to add to one’s New Year’s Resolutions.
Wishing you peace, love, and laughter – and no tax assessments – in the New Year!
The author is a Senior with the Tax & Corporate Services division of Navarro Amper & Co., the local member firm of Deloitte Southeast Asia Ltd. – a member firm of Deloitte Touche Tohmatsu Limited – comprising Deloitte practices operating in Brunei, Cambodia, Guam, Indonesia, Lao PDR, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam.