Income Tax Return: How to Get ITR in the Philippines

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An income tax return is a yearly document from the Bureau of Internal Revenue (BIR). Today, we will discuss the following:

• What is an income tax return (ITR)?
• Who needs it and why?
• How to get an income tax return in the Philippines?
• Other important things you need to know.

We hope this article will prepare you to get your ITR and document that you are paying your taxes.

What is ITR in the Philippines?

The annual income tax return (ITR) is a document that totalizes all your financial transactions for a calendar year. It applies to employees and business entities.

The income tax return in the Philippines serves to prove that you paid your due taxes either as an employee or as a professional. Business entities like corporations must also get an ITR or file it.

Who pays an ITR? All people who earn taxable amounts of money have to do it.

Types of Individual Taxpayers	Description
Employees	Employed individuals paid a taxable salary
Entrepreneurs or corporations	People who operate a registered business
Mixed-Income Earners	Individuals who generate income through various means

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What Incomes Are Subject to Tax?

The citizens of the Philippines have different categories of incomes:

Compensation income is the money that employees get from employers. This type of income includes salaries, wages, emoluments, commissions, chargeable bonuses, and fringe benefits.

Business and professional income is obtained from trade, professional experience, sale or exchange of assets, renting of apartments, and other types of income that do not fit into the category of compensation income.

Passive income is the income from bank deposits, royalties, winnings, dividends, and the sales of shares of stock.
All these types of income are subject to tax.

Who Is Required to File an ITR?

Filipino citizens are obliged to pay taxes for all incomes, regardless of their source. Foreigners who live in the Philippines file their ITRs only for the money derived from sources inside the country. Generally, the taxpayers are divided into two big groups: individuals and non-individuals.

✅ Non-Individuals

This group includes:

• All types of corporations and partnerships.
• Domestic businesses getting income from both inner and international sources.
• Foreign companies that gain profit in the Philippines.
• Estates and trusts involved in the trade or business activities.

✅ Individuals

This category of taxpayers includes:

• Resident citizens who get money from inner and international sources. They may have one or several employers within
• the tax period, be self-employed or professionals with mixed income.
• Non-resident citizens who obtain income from Philippine-based sources.
• Resident and non-resident foreign individuals earning money in the Philippines.

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Who Are the Individuals with Mixed Sources of Income?

A mixed-income earner is a person who earns money in different ways. For example, a doctor who earns from consultations and at the same time gains money as an employee is a mixed-income earner.

An employed person registered as a sole proprietorship business owner is also considered a mixed-income earner.

How to Enroll As an Individual with Mixed Sources of Income

The first step to enroll as an individual with mixed sources of income is to get your Certificate of Registration. You will get this from the BIR (1).

Here are the documents you need:

• Valid government ID.
• BIR Form 1901 (three copies).
• If you are a professional, you must provide your professional license and professional tax receipt.
• If you are a business owner, you must present your DTI certificate and Mayor’s Permit.

To get started, go to the BIR office, and they will give you further instructions. Once you have submitted the documents, they will ask you to present samples of invoices and receipts. Once they approve these receipts, you can now begin to print them and issue them to your clients.

At the end of the year, you will file your ITR, but you are now classified as a mixed-income earner.

Here is the table describing the ways different groups of individuals and companies report their earnings.

Types of taxpayers	Types of income	BIR Form
Individuals	Purely compensation earnings, including non-business income and non-professional income	BIR Form 1700
	Money from your business or profession	BIR Form 1701A
	Money earned as self-employed	BIR Form 1701
	For quarterly reports	BIR Form 1701Q
Non-individuals	Non-individuals exempted under the Tax Code or other laws and having no other taxable income	BIR Form 1702-EX
	For quarterly reports	BIR Form 1702Q
	Mixed income and earnings eligible for a special rate	BIR Form 1702-MX
	Income subject to a regular or fixed tax rate	BIR Form 1702-RT

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Who Is Exempted from Filing an Income Tax Return

Most citizens must pay taxes on their profits. However, there are the cases when Filipinos are not required to file an ITR (3):

1. When they earn a minimum wage.
2. When their taxable income is less than or equal to Php 250,000.00.
3. When their income tax was withheld by an employer, provided that there was only one employer during the taxable year.
4. When their earnings are due for final withholding tax.
5. When they are excluded from income tax in compliance with the Tax Code or other laws.When they are qualified under “substituted filing”. To fit into this category, an employee must meet at least one of these requirements for an ITR:

• obtain purely compensation income during the taxable year;
• obtain income from only one hirer during the taxable year;
• have the amount of tax due equal to the sum of tax withheld by the employer;
• have the spouse who also complies with all the above mentioned conditions;
• have the hirer who files the annual income declaration (4);
• have the hirer who issues BIR Form No. 2316 to each staff member (5).

Besides, there are the groups of citizens and organizations that are always exempt from the income tax. They are:

• Non-resident citizens who get income from abroad and inform the Commissioner that they are physically present outside the Philippines.
• Filipino citizens who reside abroad as immigrants or full-time workers and get money from abroad.
• Overseas Filipino working men, including seamen.
• General Professional Partnerships and others.

How to Get Income Tax Return in the Philippines

Thanks to modern technology, citizens and corporations in the Philippines can file taxes in a number of different ways. We will tell you about the simplest of them.

Ноw to Get Income on tax Return In-Person

Where to get an ITR in the Philippines? To apply for an ITR, the first thing you need to do is to prepare the documentary requirements.

Make sure you have the following documents:

• BIR Form 1901 — two copies.
• Valid government ID — the ID must show your birthday, name, and home address.
• Occupational Tax Receipt if you are a professional like a lawyer or a doctor.
• Mayor’s Permit and DTI if you are a registered business.
• BIR Form 1906.

There are some documentary requirements when you want to file for an ITR as an individual with mixed sources of income. You need to submit these documents:

• Your BIR Form 1701.
• Proof of your income, such as a business permit or an employment certificate.
• Proof of residence.
• Proof that you are a Filipino citizen.
• If you are not a Filipino citizen, you must show proof of non-resident alien status.

Take note that mixed-income earners are required to file their ITR on or before April 15th of every year.

Now that you have these documents, follow these steps:

• Go to your BIR RDO or Revenue District Office.
• Submit the forms and your ID, along with the other documents.
• Pay the Annual Registration Fee (Php 500.00), which they also call the ARF. You can do it at a bank or cashier in the BIR if there is one.
• Remit the payment for the documentary stamp tax and certification fee.
• Attend the briefing if required; mostly, this is for first-timers only.

Now, they will tell you to come back for your ITR. You must go back on the said date to get the physical copy of your ITR.

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How to Get ITR Online in the Philippines

Anyone who is registered as a taxpayer can use the eFPS — the Electronic Filing and Payment System developed and maintained by the BIR for electronically filing tax returns and paying taxes due. All you have to do is go to the BIR website and click the eFPS link (2).

Enroll, and you will be able to access this feature. To make things right, follow the prompts.

Once you file an ITR online, you will fill out the details on your computer. Be sure that you know your RDO code and have all the correct business information that matches BIR’s record.

There are certain groups of taxpayers who are required to make use of the BIR eFPS services:

• Large taxpayers, properly notified by the BIR.
• The top 20,000 private entities of the country.
• The top 5,000 unincorporated taxpayers.
• Taxpayers that want to conclude contracts with governmental organizations.
• Companies with paid-up capital stock of Php 10,000,000.00 and others.

You can also apply to the Electronic BIR Forms or eBIRForms (3). They were created for non-eFPS taxpayers, who don’t want to lose time visiting different organizations to file taxes in the Philippines.

eBIRForms include offline and online packages. To use the offline packages, you have to download a tax-preparation software and install it on your computer. This software will allow you to fill out the tax forms and submit them within the system. The online package is provided on the website — you can fill it out right here.

How to Check ITR Status and Retrieve ITR Copy

After filing the ITR, go back to your eFPS account and do the following:

1. Click on the box that says Income Tax Return (ITR) Status.
2. Type your acknowledgment number.
3. Type your mobile number.
4. Click ‘Continue’.

You will receive a 6-digit OTP on your phone, enter that, and then click submit. After this, you will see the status of your ITR.

To retrieve a copy of the ITR, go to the RDO to get this copy. Submit completed BIR Form 1702Q and attachments at RDO of BIR Tax Filing Center. Obtain stamped and validated copy from RDO.

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Tips to Remember When Getting ITR in the Philippines

Here are some useful tips when Filing your ITR.

• Be mindful of deadlines — the usual deadline is April 15. File your ITR in January or February, so you do not have to rush with other people.
• Keep accurate records and receipts — make sure your records are correct. If your documents are questionable, the BIR may investigate you.
• Seek assistance if needed — it is better to let an accountant do this for you. However, you will pay a monthly retainer fee to this accountant.
• Double-check before submission — make sure your documents and details are correct, or you will pay a fine for changes. The last thing you want is to overpay your taxes.

Conclusion

The ITR is a document proving that you paid your taxes due. You must file it annually. Filing income tax returns in the Philippines can be a complex process, but it is an essential responsibility for all taxpayers.

By following the step-by-step guidelines provided by the BIR and ensuring all necessary documents are prepared and submitted on time, individuals and businesses can fulfill their tax obligations and avoid any penalties or legal repercussions.

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