2019 Year End Adjustment

2019 Seminar on
Year-end Adjustment,
Estate Tax Amnesty
and Other Tax Updates
November 21, 2019 @ BIR Covered Court, RDO No.

104, Bayugan City, Agusan del Sur
TRAIN Briefing – IT & WT
VER 2.0 – April 2018
TOPIC OUTLINE:
PART I. Year-end Adjustment
PART II. Estate Tax Amnesty
PART III. Other Updates

YEAR-END ADJUSTMENT
 Section 251 & 252 of NIRC, as amended
 Republic Act 8424
 Revenue Regulation No. 2- 1998
 Republic Act No. 9504
 Republic Act No. 10963 (TRAIN)
Withholding Tax on Compensation
 It is a method of collecting the income tax at
source
 It applies to all employed individuals whether

citizens or aliens, deriving income from
compensation for the services rendered within
the Philippines.
 Employer is constituted as the withholding agent

Be withheld or refunded?
Tax Due for the entire year P XX

Less: Sum of Taxes Withheld
From January to November P XX
Tax to be Withheld/(Refunded) XX

YEAR-END ADJUSTMENT
 Be made before payment of the last

compensation for the year. The objective is to
attain a situation wherein TAX DUE IS EQUAL
TO TAX WITHHELD.

YEAR-END ADJUSTMENT
 A process done by the employer to determine

the annual compensation income, deductions
and income tax due for a particular taxable
year of each employee;

YEAR-END ADJUSTMENT
 Also determine the amount of tax that should be

withheld for the month of December or refunded
to each employee;
 Basis in preparing the alphabetical list of

employees.

Tax withheld > Tax due
Refund on or before Jan.25th of the following
year / last payment of wage (terminated /resigned
employees)
Tax withheld< Tax due

Withhold balance in Dec / last salary
Tax due = Tax withheld

Do not withhold for December salary/ last salary

Definition of Terms:
Compensation Income
 means all renumeration for services performed

by an employee for his employer under an
employer-employee relationship

Employee
 individual performing services under an

employer-employee relationship

Employer
 any person for whom individual performs any

services of whatever nature under an employer-
employee relationship

TAXABLE COMPENSATION
Regular compensation
 Includes basic salary, fixed allowances for

representation, transportation and other allowances
paid to an employee per payroll period

TAXABLE COMPENSATION
Supplementary Compensation
 includes payments to an employee in addition to the

regular compensation, such as commission, overtime
pay, taxable retirement, taxable bonus, and other
taxable benefits, with or without regard to a payroll
period

INCOME PAYMENTS EXEMPTED FROM WTAX
ON COMPENSATION
1. Compensation income earned by Minimum

Wage earners.
 Income payment paid to Minimum Wage Earner (MWE)
by the same employer, other than the basic SMW,
Holiday pay, Hazard pay, Overtime pay, Night-Shift
differential pay – shall be taxable and subject to WT (RR
No. 11-2018)

Illustration Ms. Alona is employed in CSO Corporation. She
received the SMW for 2019 in the total amount of
₱175,000, inclusive of the 13th month pay. In the
same year, she also received overtime pay of
Sec. 2.78.1 ₱40,000 and night-shift differential of ₱25,000.
Withholding Tax She also received commission income from the
on same employer of ₱20,000, thus, total income
Compensation received amounted to ₱260,000.
Compute for the withholding tax due.

Illustration : Computation
The employer of Ms. Alona shall determine the nature of income payments. The
amount to be subjected to income tax withholding shall be computed as
follows:
– Total Income received ₱ 260,000.00
– Less: Income exempt from tax
– Basic SMW ₱175,000.00
– Overtime Pay 40,000.00
– Night Shift Differential 25,000.00
– Total Exempt Income as MWE 240,000.00
– Taxable Income- Commission ₱ 20,000.00
Tax Due:
On not over P250,000.00 (₱20,000.00 x 0%) ₱ 0.00

INCOME TAX RATES

INCOME PAYMENTS EXEMPTED FROM WTAX ON
COMPENSATION (cont’d)
3. Remuneration as an incident of employment, such as follows:
a) Retirement benefits received under RA 7641
b) Any amount received by an official or employee or by his heirs
from the employer due to death, sickness or other physical
disability or for any cause beyond the control of the said
official or employee such as retrenchment, redundancy or
cessation of business.

c) Social Security benefits, retirement gratuities, pensions
and other similar benefits
d) Payment of benefits due or to become due to any person

residing in the Philippines under the law of the US
administered by the US Veterans Administration

e) Payment of benefits made under the SSS Act of 1954, as

amended.
f) Benefits received from the GSIS Act of 1937, as amended,

and the retirement gratuity received by the government
employee.

4. Remuneration paid for Agricultural Labor
5. Remuneration paid for domestic services
6. Remuneration for casual labor not in the course of an

employer’s trade of business

10. Amount received by the insured as a return of
premium
11. Compensation for injuries or sickness.
12. Income exempt under treaty

13. GSIS, SSS, Medicare (Philhealth), and Pag-ibig
contributions
14. 13th month pay, bonuses and other benefits not

exceeding the P 90,000 ( other benefits include the excess
amount of the prescribed ceiling of the de minimis
benefits)

15. De Minimis Benefits (with amendments by TRAIN)
16. Compensation during the year not exceeding P250,000

(TRAIN)

Exempt
De Minimis Benefits Taxable
(Ceiling)
a. Monetized VL of private employees 10 days Excess
b. Monetized VL & SL of Gov’t Employees No limit N/A
P1,500/sem
c. Medical cash allowance to dependents or Excess
P 250/mo.
d. Rice Subsidy (1 sack of 50kgs) P2,000/mo Excess

Exempt
De Minimis Benefits (Ceiling) Taxable
e. Uniform & Clothing Allowance P6,000/yr Excess
f. Actual Medical Assistance P10,000/yr Excess
g. Laundry Allowance P300/mo Excess
h. Achievement Awards –Personal
Tangible prop(for length of service/safety P10,000 Excess
achievement) with established written
plan

Exempt
De Minimis Benefits Taxable
(Ceiling)
i. Christmas Gifts, Anniversary Gifts P5,000 Excess
j. Daily meal allowance – overtime, 25% of Basic
graveyard shift Min. Wage Excess

Section 2.79 (RR No. 2-98)Income Tax Collected
at Source on Compensation Income
Amendments Pertain to:
• No reference to number of dependents due

Withholding to removal of personal and additional
Tax Table exemptions
• Change in Income tax rates
• Change in compensation range

Withholding Tax Table (To be used until Dec. 31, 2022)
REVISED WITHHOLDING TAX TABLE
Effective January 1, 2018 to December 31, 2022
DAILY 1 2 3 4 5 6
P 685 and below
Compensation Range P685 – P1,095 P1,096 – P2,191 P2,192 – P5,478 P5,479 – P21,917 P21,918 and above
0.00 P 82.19 P 356.16 P 1,342.47 P 6,602.74
Prescribed Withholding
0.00
Tax
+ 20% over P 685 + 25% over P 1,096 + 30% over P2,192 + 32% over P 5,479 + 35% over P21,918
WEEKLY 1 2 3 4 5 6
P 4,808 and below
Compensation Range P 4,808 – P 7,691 P 7,692 – P15,384 P 15,385 – P 38,461 P 38,462 – P153,845 P 153,846 and above
0.00 P 576.92 P 2,500.00 P 9,423.08 P 46,346.15

0.00 + 35% over P
Tax
+ 20% over P 4,808 + 25% over P 7,692 + 30% over P 15,385 + 32% over P 38,462 153,846
SEMI-MONTHLY 1 2 3 4 5 6
P 10,417 and below
Compensation Range P 10,417 – P16,666 P 16,667 – P 33,332 P 33,333 – P 83,332 P 83,333 – P333,332 P 333,333 and above
0.00 P 1,250.00 P 5,416.67 P 20,416.67 P 100,416.67
0.00 + 35% over P
Tax
+ 20% over P 10,417 + 25% over P 16,667 + 30% over P 33,333 + 32% over P 83,333 333,333
MONTHLY 1 2 3 4 5 6
P 20,833 and below
Compensation Range P 20,833 – P 33,332 P 33,333 – P 66,666 P 66,667 – P 166,666 P 166,667 – P666,666 P 666,667 and above
Tax 0.00 0.0 P 2,500.00 P 10,833.33 P 40,833.33 P 200,833.33
VER 2.0 – April 2018 + 20% over P 20,833 + 25% over P 33,333 + 30% over P 66,667 + 32% over P 166,667 +35% over P 666,667
Illustration
Ms. Lyn, an employee of MAG Corp. is
receiving regular monthly compensation in the
amount of ₱35,000, net of mandatory
Sec. 2.79
Income Tax contributions, with supplemental
Collected at compensation in the amount of ₱5,000 for the
Source on month.
Compensation
Income
Compute for the amount to be withheld.

Illustration : Computation
Total taxable compensation ₱ 35,000.00
Less: Compensation Range (Minimum) 33,333.00
Excess ₱ 1,667.00
Add: Supplemental Compensation 5,000.00
Total ₱ 6,667.00
Withholding tax shall be computed as follows:

On ₱33,333.00 ₱ 2,500.00
Excess (₱35,000.00 - ₱33,333.00 +
Supplemental compensation of ₱5,000.00) x 25%= 1,666.75
Total monthly withholding tax ₱ 4,166.75

Year- end Adjustment Illustration
Ms. Lyn, an employee of MAG Corp. has the following personal data:
Basic Salary for the year (40,000 x 12 mos.) 480,000.00
Supplementary Compensation
(overtime, commission) 60,000.00
13th month pay 40,000.00
Other benefits 55,000.00
Mandatory Contributions –
(SSS/HDMF/PHIC Cont.) 60,000.00
Tax Withheld (P4,166.75 x 11 mos.) 45,834.25
Compute for the amount to be withheld.

COMPUTATION:
Basic Salary for the Year 480,000.00
Supplemental Compensation 60,000.00
13th Month Pay 40,000.00
Other Benefits 55,000.00
Gross Compensation 635,000.00
Less: Non-Taxable Compensation
Mandatory Contributions - SSS/HDMF/PHIC 60,000.00
Non-taxable Benefits 90,000.00 150,000.00
Taxable Compensation 485,000.00
Tax Due
Tax on P400,000 30,000.00
Tax in excess of P400,000 (85,000*25%) 21,250.00
Total Tax Due 51,250.00
Less: Withholding Tax (Jan-Nov) 50,001.00
Withholding Tax for December 1,249.00
INCOME TAX RATES

REMINDERS IN PREPARING YEAR END ADJUSTMENT
 Review composition of compensation income – taxable and non
taxable
 Review category of employees based on the required schedule of

the alphalist
- sch 7.1 Employees terminated before Dec 31
- sch 7.2 Employees whose compensation income are exempt from
withholding but subject to income tax
- sch 7.3 Employees as of Dec 31 with no previous employer
- sch 7.4 Employees as of Dec 31 with previous employer
- sch 7.5 Alphalist of Minimum Wage Earners
 Perform year end adjustment before remitting taxes withheld for
December
 Identify employees who are qualified for substituted filing and those
who are not. Conditions to qualify for substituted filing:
1. Single employer only;
2. Not engaged in business; or
3. Spouse is not engaged in business or exercise of profession
 Deadline for the alphalist of Employees (BIR Form 1604C)is January 31,
using:
Data Entry Module Program (Version 6.1)
- downloadable from the web (www.bir.gov.ph)

Section 2.79.4 Husband and Wife
“SECTION 2.79.4. Husband and Wife – Where both

husband and wife are each recipients of compensation
either from the same or different employers, taxes shall
be withheld separately in accordance with the applicable
revised withholding tax table (Annex “D” or “E”).”

Section 2.83.1 Employees Withholding Statement
(BIR Form 2316)
DUPLICATE FOR
THE BIR
EMPLOYER SHALL BIR FORM

ISSUE BIR FORM NOT LATER 2316 TRIPLICATE FOR
2316 TO THAN THE EMPLOYER
JANUARY 31
ORIGINAL
EMPLOYEES (TO BE RETAINED
COPY FOR THE FOR A PERIOD OF 10
EMPLOYEE YEARS)

(BIR Form 2316)
The Certificate shall indicate the following information:
a. Name and address of the employee;
b. Employee’s Taxpayer Identification Number (TIN);
c. Name and Address of the Employer;
d. Employer’s TIN;
e. The sum of compensation paid, including the non-
taxable benefits;

(BIR Form 2316)
f. The amount of statutory minimum wage received if

employee is MWE;
g. Overtime pay, holiday pay, night shift differential pay, and
hazard pay received if employee is MWE;
h. The amount of tax due, if any; and
i. The amount of tax withheld, if any.

(BIR Form 2316)
CERTIFIED LIST OF
EMPLOYEES
QUALIFIED FOR
DUPLICATE SUBSTITUTED
NOT LATER
COPIES OF BIR FILING OF THAN
FORM 2316 ANNUAL INCOME FEBRUARY 28 BIR
TAX RETURN
(AITR)

Section 2.83.4 Substituted Filing of Income Tax
Returns by Employees Receiving Purely
Compensation Income
CERTIFIED LIST OF CONCERNED BIR OFFICE

EMPLOYEES SHALL STAMP “RECEIVED”
THE CERTIFIED LIST OF
QUALIFIED FOR EMPLOYEES QUALIFIED TO
SUBSTITUTED AVAIL OF THE SUBSTITUTED
NOT LATER
FILING OF THAN FILING OF AITR, WHICH SHALL
BE TANTAMOUNT TO BIR
ANNUAL INCOME FEBRUARY 28
FORM 1700 (AITR) OF THE
TAX RETURN QUALIFIED EMPLOYEES
(AITR)

DUE DATES TO REMEMBER:
January 15 - filing /payment of WT under BIR Form
1601C for the month of December
January 25 - refund to employees of excess WT
January 31 - submission of BIR Form 1604C,
together with the Alpha List of Employees
January 31 - distribution of BIR Form 2316 to all
employees
February 28 -submission of duplicate copies of BIR Form
2316 of employees who are qualified for Substituted
Filing
INTERNAL BRIEFING
ESTATE TAX AMNESTY
REVENUE REGULATIONS NO. 6-2019
Implementing the Provisions of Estate Tax Amnesty under
Title II of Republic Act (R.A.) No. 11213, Otherwise known
as the “Tax Amnesty Act”
Sur)

VER 2.0 – April
Assessment
Assessment 2018 ––Tax
Service
Service TaxAmnesty
AmnestyAct
Act BIR-RR
BIR-RRCommittee
Committee
48
Section 1. Purpose
Taxpayers’ one-time opportunity
to settle estate tax obligations
through an Estate Tax Amnesty
Program
Tax Amnesty Act Title II – Estate Tax

VER 1.0 – May 2019
49 Section 2. Coverage
Remained
Estate of the With or without unpaid or have
decedent/s who died
on or before assessments duly accrued as of
December 31, 2017 issued December 31,
2017.

VER 1.0 – May 2019
50
Section 3. Exceptions
Delinquent estate tax liabilities which have
become final and executory and those covered by
Tax Amnesty on Delinquencies
Properties involved in cases pending in

appropriate courts:
• Presidential Commission of Good Government (PCGG cases)
• RA No. 3019 (Anti-Graft and Corrupt Practices Act) and RA No. 7080
(Act Defining and Penalizing The Crime of Plunder)

VER 1.0 – May 2019
51
Section 3. Exceptions
Properties involved in cases pending in
appropriate courts:
• R.A. No. 9160 (Anti-Money Laundering Act), as amended

• Chapter II of Title X of the National Internal Revenue Code
(NIRC) of 1997 (involving tax evasion and other criminal
offenses)
• Under Chapters III and IV of Title VII of the Revised Penal Code
(involving felonies of frauds, illegal exactions and transactions
and malversation of public funds and property)

VER 1.0 – May 2019
52
Section 4. Definition of Terms
Gross Estate
• consists of all properties and interests in

properties of the decedent at the time of his death
• as well as properties transferred during his
lifetime (only in form), but in substance, were only
transferred at the time of death.

VER 1.0 – May 2019
53
Section 4. Definition of Terms
Net Estate
• gross estate less all allowable deductions as

provided in the National Internal Revenue
Code (NIRC) of 1997, as amended, or the
applicable estate tax law prevailing at the time
of death of the decedent.

VER 1.0 – May 2019
54 Section 4. Definition of Terms
Net Undeclared Estate
• Difference between the total net estate valued
at the time of death of the decedent and the
net estate previously declared with the BIR, if
any.

VER 1.0 – May 2019
55 Section 5. Rate of Estate Tax
On each decedent’s total net taxable
estate at the time of death
6% Without penalties at every stage of
transfer of property
Provided that,
Minimum estate amnesty tax for

Php5,000
the transfer of the estate of each
decedent
VER 1.0 – May 2019
56
Section 6. Composition of the Gross
Estate
Residents and
Non-resident aliens
Citizens
all properties, real

only real and
and personal,
personal properties
tangible and
situated in the
intangible,
Philippines
wherever situated

VER 1.0 – May 2019
57 Section 7. Valuation of Gross Estate
Fair Market Value as of the time of death
In general of the decedent
Real Properties
• Higher value between the Zonal Value and
the Fair Market Value as shown in the
schedule of values fixed by the provincial and
city assessors.
VER 1.0 – May 2019
58 Section 8. Deductions from the
Gross Estate
Gross estate may be reduced by the

deductions allowed by the estate tax law
applicable at the time of death of the
decedent (Annex A).

VER 1.0 – May 2019
Section 9. Time and Place of Filing Estate Tax
59 Amnesty Return (BIR Form 2118-EA) and Payment of
Estate Tax Due
Time: Within two (2) years from the effectivity
of these Regulations (June 14, 2021)
Place: In case of a resident decedent

RDO having jurisdiction over the
last residence of the decedent

VER 1.0 – May 2019
Estate Tax Due
Place: In case of a non-resident decedent
• With executor or administrator
RDO where such executor/administrator is
registered or if not yet registered, at the
executor/administrator’s legal residence
•With no executor or administrator
RDO No. 39- South Quezon City
VER 1.0 – May 2019
Estate Tax Due
• The duly accomplished and sworn ETAR, together with

the complete documents as enumerated in the ETAR,
shall be presented to the concerned RDO for
endorsement of the Acceptance Payment Form (
BIR Form 0621-EA) (APF) prior to the payment of the
estate amnesty tax with the AABs or RCOs.

VER 1.0 – May 2019
Estate Tax Due
• Only the duly endorsed APF by the RDO shall be
presented to and received by the AAB or RCO.
• After payment, the duly accomplished and sworn ETAR
and APF with proof of payment, together with the
complete documentary requirements shall be
immediately submitted to the RDO in triplicate copies for
issuance of Certificate of Availment.
VER 1.0 – May 2019
Estate Tax Due
 Failure to submit the same within the two (2)-year period

from the effectivity of these Regulations is tantamount to
non-availment of the Estate Tax Amnesty and any
payment made may be applied against the total regular
estate tax due inclusive of penalties.

VER 1.0 – May 2019
64
Section 10. Estate Tax Amnesty Return for
Undeclared Properties
An Amended Estate Tax Amnesty Return (ETAR) can be filed

for properties not declared in the previously filed return
within two (2) years from the effectivity of these
Regulations.

VER 1.0 – May 2019
65
Section 11. Estate with Properties Subject
of Taxable Donation/Sale
Properties subject of taxable donation/sale shall

be assessed of the corresponding donor’s/capital
gains/or other applicable taxes at the time of
donation/sale including penalties, if applicable.

VER 1.0 – May 2019
66
Section 12. Issuance of Certificate of Availment
Shall be issued by the RDO within fifteen (15)
calendar days from the receipt of:
• Application for Estate Tax Amnesty Return (ETAR)

• Duly Validated Acceptance Payment Form (APF)
• Complete Documentary Requirements

VER 1.0 – May 2019
Section 13. Issuance of electronic
67
Certificate Authorizing Registration (eCAR)
Real Property
• One (1) eCAR shall be issued, including
improvements, covered by OCT, TCT, CCT or Tax
Declaration for untitled properties.
Personal Properties
• One (1) eCAR to be issued separately from real
property
VER 1.0 – May 2019
68 Section 18. Effectivity
June 15, 2019 to June 14, 2021

VER 1.0 – May 2019
Other Updates
• TAMP
• Documentary Stamp Tax
• Proprietary Activities of Government
Offices

WHO ARE CONSIDERED
TOP WITHHOLDING AGENTS? (TWAs)
A. Classified and duly notified by the Commissioner as either any of

the following unless previously de-classified as such or had
already ceased business operations:
1) A large taxpayer under Revenue Regulations No. 1-98, as

amended;
2) Top 20,000 private corporations under RR No. 6-2009; or

WHO ARE CONSIDERED
TOP WITHHOLDING AGENTS? (TWAs)
A. Classified and duly notified by the Commissioner

3) Top 5,000 individuals under RR No. 6-2009;
B. Taxpayers identified and included as Medium Taxpayers, and

those under the Taxpayer Account Management Program
(TAMP) (RMO 4-2002), (RR No. 11-2018)

• The top withholding agents by concerned LTS/RRs/RDOs
shall be published in a newspaper of general circulation.
It may also be posted in the BIR website.
• These shall serve as “notice” to the top withholding

agents.

OBLIGATIONS OF TOP
WITHHOLDING AGENT (TWAs)
 Withhold 1% creditable expanded withholding tax on

your purchases of goods local suppliers.
Withhold 2% on purchases of services from local

suppliers.

DEFINITION OF TERMS:
• The term “goods” pertains to tangible property. It
does not include intangible personal property, as
well agricultural products which are defined under
item (N) of this Section (RR 11-2018, Sec. 2)
• The term “local resident supplier of
goods/suppliers of services” pertains to a supplier
from whom any of the top withholding agents,
regularly makes its purchases of goods/services.
• General Rule, this term does not include a
casual purchase of goods/services that is a
purchase made from a non-regular supplier
and oftentimes involving a single purchase.
• However, a single purchase which involves
P10,000.00 or more shall be subject to
withholding tax under this subsection. (RR
11-2018, Sec.257.2)

DEFINITION OF TERMS:
• The term ‘regular suppliers”, for purposes of
these regulations, refer to suppliers who are
engaged in business or exercise of
profession/calling with whom the taxpayer-
buyer has transacted at least six (6) transactions,
regardless of amount per transaction, either in
the previous year or current year.

Section 2.58 Returns and Payment of Taxes
Withheld at Source
Not later than the

Manual 1601EQ last day of the month
following the close of
the quarter
But, withheld taxes are required to be

remitted not later than the 10th day
0619E
following the close of the month (for
the first two months of the quarter)

77
Withheld at Source
eFPS 1601EQ
Not later than the last day
of the month following
the close of the quarter
But, withheld taxes are required

to be remitted not later than the
0619E
10th day following the close of
the month (for the first two
months of the quarter)
78
Withheld at Source
Expanded • 0619-E
BIR Form 1601-EQ
Withholdin • (first 2 (quarter)
g Tax • months)

79
Withheld at Source
Certificate/Statement of Tax Withheld at Source
• BIR Form 2307 (20 days from the

Expanded/Creditable
Withholding Tax close of the quarter or upon demand
of the payee)
• BIR Form 2306 (20 days from the

Final Withholding Tax close of the quarter or upon demand
of the payee)

80
Withheld at Source
Annual Information Return &
Annual Alphabetical List of Payees
Expanded • BIR Form 1604-E (March 1)

Withholding Tax
Final Withholding • BIR Form 1604-F (January 31)

Tax

81
OBLIGATIONS OF TOP
The taxpayer should have commenced withholding

on purchases of goods and services effective July 1,
2019
Revenue Regulation 10-2014 requires the
mandatory enrollment under Electronic Filing and
Payment (eFPS) of returns/taxes. Penalties shall be
imposed under Revenue Memorandum Order No.
7-2015.
OBLIGATIONS OF TOP
Any open cases should be submitted and will

strictly be monitored including its final
resolution. Penalties shall be imposed under
Revenue Memorandum Order No. 7-2015.

PENALTIES AND OTHER SANCTIONS
• The obligation to withhold is imposed upon the
buyer-payor of income although the burden of tax is
really upon the seller-income earner/payee; hence,
unjustifiable refusal of the latter to be subjected to
withholding shall be a ground for the mandatory
audit of all internal revenue tax liabilities, as well as
the imposition of penalties pursuant to Section 275 of
the Tax Code, as amended, upon verified complaint of
the buyer-payor.

OTHER UPDATES
DOCUMENTARY STAMP TAX
RR No. 4-2018- Documentary Stamp Tax Adjustment under RA10963 (TRAIN Law)
NIRC Provision
NIRC
TRAIN
Other Updates cont.
• Governmental Functions-are those pertaining to the
administration of government and are treated as absolute
obligation on the part of the state to perform.
 (DILG)Local Government Unit

Granting of Mayor’s Permit

Other Updates cont.
• Proprietary Activities- those that are undertaken by way of

advancing the general interest of
society and are merely optional.
- are TAXABLE
 Rentals paid by tenants for a leasing activity


2019 Year End Adjustment

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2019 Seminar on

November 21, 2019 @ BIR Covered Court, RDO No.

PART I. Year-end Adjustment

PART II. Estate Tax Amnesty

PART III. Other Updates

TRAIN Briefing – IT & WT

 It applies to all employed individuals whether

 Employer is constituted as the withholding agent

Tax Due for the entire year P XX

TRAIN Briefing – IT & WT

 Be made before payment of the last

TRAIN Briefing – IT & WT

 A process done by the employer to determine

TRAIN Briefing – IT & WT

 Also determine the amount of tax that should be

 Basis in preparing the alphabetical list of

TRAIN Briefing – IT & WT

Tax withheld< Tax due

Tax due = Tax withheld

TRAIN Briefing – IT & WT

 means all renumeration for services performed

TRAIN Briefing – IT & WT

 individual performing services under an

TRAIN Briefing – IT & WT

 any person for whom individual performs any

TRAIN Briefing – IT & WT

 Includes basic salary, fixed allowances for

TRAIN Briefing – IT & WT

 includes payments to an employee in addition to the

TRAIN Briefing – IT & WT

1. Compensation income earned by Minimum

TRAIN Briefing – IT & WT

Compute for the withholding tax due.

TRAIN Briefing – IT & WT

TRAIN Briefing – IT & WT

TRAIN Briefing – IT & WT

d) Payment of benefits due or to become due to any person

TRAIN Briefing – IT & WT

e) Payment of benefits made under the SSS Act of 1954, as

f) Benefits received from the GSIS Act of 1937, as amended,

TRAIN Briefing – IT & WT

4. Remuneration paid for Agricultural Labor

5. Remuneration paid for domestic services

6. Remuneration for casual labor not in the course of an

TRAIN Briefing – IT & WT

11. Compensation for injuries or sickness.

12. Income exempt under treaty

TRAIN Briefing – IT & WT

14. 13th month pay, bonuses and other benefits not

TRAIN Briefing – IT & WT

15. De Minimis Benefits (with amendments by TRAIN)

16. Compensation during the year not exceeding P250,000

TRAIN Briefing – IT & WT

a. Monetized VL of private employees 10 days Excess

b. Monetized VL & SL of Gov’t Employees No limit N/A

TRAIN Briefing – IT & WT

TRAIN Briefing – IT & WT

TRAIN Briefing – IT & WT

• No reference to number of dependents due

TRAIN Briefing – IT & WT

0.00 P 576.92 P 2,500.00 P 9,423.08 P 46,346.15

Compute for the amount to be withheld.