Operating a business is a challenging process. You are not only dealing with the everyday operations of the business activities but as well as dealing with the proper regulatory compliance – one of this is the Quarterly Income Tax filing.
BIR Form 1702Q is a form for Quarterly filing for Industry other than Individual taxpayers (e.g., Partnerships and Corporations).
The image on the left is an example of the form.
Here are some tips in filing for your Quarterly Income Tax:
- Check if you are required to file for Quarterly Income Tax
This is normally found on the BIR form 2303 (also known as the certificate of registration) which indicates what type of tax you are required to file.
Sometimes, if the taxpayer sees the “Income tax” legend, he/she assumes that it should be filed ANNUALLY. But base on BIR Revenue Regulation, it is still to be filed on a quarterly and as well as on an annual basis.
- Fill-up the form properly
You must keep an eye on the important details in filling up the form, or you will not report it properly and probably be assessed by the BIR in some cases as necessary. It is much better if you hire a competent bookkeeper or outsourced it to an accounting/auditing firm.
How To File?
There are different ways on how to file for the quarterly income tax namely:
Manual filing – this is where you go to your nearest RDO (Revenue District Office) and ask for a copy of BIR form 1702Q and file it manually. You can also download the file just like the image presented above.
eBIRForms System– is an application from the BIR that gives the taxpayer the option to file their income taxes electronically. It is an offline version of filing but once you finish filling up everything, you still have to submit it online through the application itself. All you need is an internet connection. After submitting, you pay your tax through any AABs (Authorized Agent Banks)
You can download the application forms here: http://ftp.pregi.net/bir/ebirforms_package_v7.4.2.zip
EFPS – stands for (Electronic Filing and Payment System) is almost the same as eBIR forms but the advantage here is that you do not need to go to any AABs, instead you only pay through online using your bank account.
You can enroll for EFPS by sending a request letter to your RDO (Revenue District Office). It only takes several days to process your request.
Upon approval, just go to this link and follow the steps on the site for enrolment: https://efps.bir.gov.ph/
Please take note that BIR is transitioning to using electronic filing and using manual filing is gradually disregarded.
- Be aware of the deadline
For partnerships and corporations, the deadline is 60 days after the end of the taxable quarter. SO, for the quarter ending September 30, 2019, the deadline will be on the 29th of November 2019.
- Substantiate your form with the proper documents
It is advisable to compile all your receipts and invoices “chronologically” to summarize the income/expense related accounts easily. Also, the receipts should be the “Official Receipts” that shows the following:
• Trade Name
• Proprietor or Operator
• Invoice / OR Number,
• Date of Transaction
• Details of Payment or Sales Transaction
• “Authority to Print” from the Bureau of Internal Revenue (BIR).
Note: Expense deduction is not applicable if the following are presented as supporting documents.
• Signed vouchers
• Ordinary receipts (those that are brought from the office supplies store)
• Acknowledgment Receipts
• Billing notice
- Coordinate with the Bookkeeper or the Accounting In Charge of the proper tax scheme
This is the time you assess on what kind of tax regime are you applying for your tax compliance because there are several ways on how to compute for the income tax and with the proper tax advice, you may choose the lesser expense for the processing. This is one way of minimizing the tax expense (not tax evasion) to save your money upon choosing the best possible option.
Another tax process is also known as SAWT (Summary Alphalist of Withholding Tax Agents). This is a summary list that is attached and to is submitted through BIR (Bureau of Internal Revenue) either quarterly, or annually, depending on the form that is associated with it, like the 1702Q/1702.
Always compile your creditable withholding taxes (BIR form 2307) to claim correspondingly for creditable income tax. It is much better if still be arranged chronologically or every quarter for simple extraction of information upon filing for SAWT.