DISQUS

Guest · 2 months ago

I find How to computer personal tax very informative. I read that persons exempt from VAT under Sec. 109z of the Tax Code is P550,000 or less gross income. But in the BIR website, it is P750,000 gross income. Which one is the right amount to use for exemption from VAT under Sec. 109z of the tax code.

viclogic · 2 months ago

Hi Mizpah,

Thank you for visiting.
Republic Act No. 9337 which took effect on July 1, 2005 further amended Sec. 109 of the National Internal Revenue Code of 1997, as amended. Section 7-v of RA 9337 stated that:

"(V) Sale or lease of goods or properties or the performance of services other than the transactions mentioned in the preceding paragraphs, the gross annual sales and/or receipts do not exceed the amount of One million five hundred thousand pesos (P1,500,000): Provided, That not later than January 31, 2009 and every three (3) years thereafter, the amount herein stated shall be adjusted to its present value using the Consumer Price Index as published by the National Statistics Office (NSO);

Guest · 1 month ago

Thank you for your immediate reply and answer to my question. I greatly appreciate it. Best regards.

Raymond Cruz · 1 month ago

Good Day,

I'd like to know how to compute royalty fees on someone who is using my receipts.
If i understood correct, should it fall on PT 103 with 7% witholding tax?
Does this mean that if they issue a receipt of P10,000, i should ask from them P700 as royalty fee?

Thank you very much for your time....

Regards

salon2009 · 1 month ago

Hello,hope you can help me answer this tax question.I am renting a space in paranaque for 20k/month.The buildong owner said to pay her total of 21k for tax and she will refund it to me after 12 months.In my understanding,she will refund me total of 12k at the end of the year.Question is, what is that tax fee for?should it be the lessor should pay the tax since that rental is really her income?pls reply.thanks.

viclogic · 1 month ago

Hi Salon2009,

First of all, a lease agreement should be evidenced by a contract of lease. There, the stipulations are stated (e.g., fee, terms, tax, etc). Assuming you are renting for business purposes, you, as a lessee is required by BIR to withhold (5%) witholding tax on income payments from rental fee. You are right in saying that the lessor is the one who earns income, and the one who is liable to BIR an income tax. That's why the BIR requires lessee to deduct a 5% withholding tax on monthly rent income that you will pay to the lessor. To make this clear, let us say for example, your gross monthly rent is 20,000. You should withhold 5% of it (1,000) and remit monthly to BIR using BIR form 1601E as discussed in my previous answers on the previous questions. Thus, you will only pay the lessor an amount of P19,000, which is net of 1,000 withholding tax (remitted to BIR). The lessor, in return will ask you for the certificate of withholing tax, which he will use to claim against his Income tax when he file and pay it to the BIR.

I just don't know what is the reason of the additional 1,000 your lessor is charging you every month. It can be an allowance to cover the tax that will be incurred by the lessor. Or it can be another allowance which can be returned to you after a period of time. I would recommend reading and examining your contract of lease with your lessor to determine the clear stipulations stated in there, and find out if they are fair and square.

ann lee · 1 week ago

hi! do you have any idea on the witholding tax for doctors who are non-vat? our health partner is deducting 15% witholding tax prior to sharing of income. is this right or are they deducting too much?i hope to hear from you. thanks.