Whether individuals or businesses, we must follow tax laws and regulations by the Bureau of Internal Revenue (BIR) -The Philippine government agency for taxation - by declaring income, filing a return, and paying tax on time.

Failure to observe, report, and pay taxes according to tax laws can have significant consequences for individuals and businesses. This includes fines and other penalties and affects the brand's reputation.

Why is it Important to Pay Tax?

Paying tax is a civic obligation to all citizens living in the Philippines. Aside from the authorities requiring it, tax money builds the nation. It enables the country's financial system to function and allows the government to invest in the well-being of its population.

What is BIR?

The Bureau of Internal Revenue (BIR) is a Department of Finance-affiliated agency. It is responsible for assessing and collecting all national internal revenue taxes, fees, and charges and enforcing all forfeitures, penalties, and fines associated with them.

Ensuring Compliance

Ensuring compliance can often be stressful knowing the complexity of codes, the ‌time that should be put into it, the requirements we may deal with, and the awareness of recent changes in tax laws to avoid unnecessary fines, penalties, and triggering BIR audits and investigations.

For these reasons, businesses and consumers should engage with tax expert accountants to support tax compliance.

Thus, Westwise Consult Inc., an expert service provider, has worked with the BIR for many years and specializes in accounting and taxation services to local and foreign entities in the Philippines. Helping clients comply with their individual and corporate tax obligations bio y determining their tax liabilities, making strategic compliance advice, keeping their tax up to date, ensuring the fillings are accurate and delivered on time, and even supporting the tax authorities' audit.

What Services and Expertise can we offer?

• Corporate Tax

Corporate tax is the tax rendered by a corporation based on the company's profit or net income.

This must be filed on or before the 15th day of the 4th month following the close of the taxpayer's taxable year.

The current corporate income tax rate is 25%, and imposing the minimum corporate income tax (MCIT) was reduced from 2% to 1% until 30 June 2023. A lower corporate income tax of 20% for domestic corporations with net taxable income not exceeding PHP5 million and with total assets not exceeding PHP100 million, excluding land on which the corporation's office, plant, and equipment are situated during the taxable year for which the tax is imposed.

• Indirect Tax Compliance - Value added tax (VAT)

The value-added tax is a sales tax. Consumption tax is charged on the sale, barter, exchange, or lease of commodities or properties and services in the Philippines and the importation of goods. It is an indirect tax passed on to the buyer, transferee, or lessee of goods, properties, or services.

The other most common example of an indirect tax is the excise tax on cigarettes and alcohol.

• Withholding Tax on Compensation

Withholding tax on compensation is a tax on the salary or wages earned by an employee or the contractors in the Philippines. This is where employers must deduct and retain a certain percentage of an employee's or contractor's paycheck every month. 

The amount withheld is then paid by the employer to the government on their behalf as proof that the employee has already paid the tax through the employer. This will serve as the employee's annual income tax return.

Business owners or employers must be proactive and aware of tax payment deadlines to avoid penalties.

• Personal Income Tax

The personal income tax is a sort of income tax imposed on a person's wages, salaries, profits derived from property, the practice of a profession, the conduct of business, and other sources.

Although there are some exemptions on who should file a personal tax, an individual whose taxable income exceeds P 250,000.00 must comply in line with the tax laws.

This must be filed on or before April 15, each year, covering income for the preceding taxable year.

Need help with your tax compliance? Contact Us!