Question & AnswerQ&A (BIR REVENUE REGULATIONS NO. 3-2002, MARCH 22, 2002)
Every payor required to deduct and withhold taxes must furnish the payee with BIR Form No. 2307 in triplicate, showing income payments and taxes withheld for every month of the quarter within 20 days after the close of the taxable quarter. For final withholding taxes, the statement should be given to the payee on or before January 31 of the succeeding year. The payor must retain a copy.
BIR Form No. 1604-E must be filed on or before March 1 of the year following the taxable year in which payments were made, while BIR Form No. 1604-CF must be filed on or before January 31 of the said year.
An individual whose sole income has been subjected to a final withholding tax as provided under Section 57(A) of the Tax Code is exempt from filing an income tax return under Section 51(A)(2)(c).
Employees receiving purely compensation income from only one employer, where tax due equals tax withheld, are not required to file BIR Form No. 1700. Instead, the employer's filing of BIR Form No. 1604-CF serves as a substituted filing of the employee's income tax return.
Conditions include individuals with multiple employers during the year, employees whose tax withheld is incorrect (tax due does not equal tax withheld), employees with monthly gross income below P5,000 opting for non-withholding, employees with other non-business income, employees whose spouses have certain filing requirements, and non-resident aliens engaged in trade or business deriving compensation income.
Employers and employees must issue a joint certification (Annex "A") certifying that the BIR Form No. 1604-CF filed by the employer corresponds with the compensation and tax withheld reflected in BIR Form No. 2316. This joint certification replaces the need for BIR Form No. 1700 for the qualified employee.
Failure to furnish BIR Form No. 2307 or BIR Form No. 2316 upon verified complaint of the payee or employee may trigger a mandatory audit of the payor's income tax liabilities, including withholding tax.
Yes. Withholding agents with ten (10) or more employees or payees are mandatorily required to submit alphabetical lists in 3.5 inch floppy diskette format along with manually prepared lists, using the prescribed CSV data file format.
Taxpayers may use the Excel format provided under Revenue Regulations No. 7-2000 with technical specifications, their own extract program meeting the requirements, or the Data Entry Module using Visual FoxPro provided by the BIR.
Withholding agents are required to retain backup copies of submitted alphabetical lists on secondary storage for a period of three (3) years from the submission date.
Only one return for the taxable year shall be filed covering the income of both spouses. The return must be signed by both husband and wife, unless physically impossible, then signature of one spouse suffices.
It became mandatory starting taxable year 2002. For taxable year 2001, substituted filing was optional.
The joint certification between employer and employee, along with BIR Form No. 2316, can serve as proof of financial capacity for purposes like loans, credit cards, tax credit claims abroad, and travel tax exemption.
Large taxpayers and excise taxpayers must submit BIR Forms 1604-CF and 1604-E to the Large Taxpayers Assistance Division, Large Taxpayers District Office, or Excise Taxpayers Assistance Division depending on their registration.
Only diskettes that are readable upon submission are considered duly filed. Submission of unreadable diskettes may result in mandatory audit of the violator's income tax liabilities including withholding tax.