Side News: Fellow professionals be a good example

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Philippine tax filling deadline

source: http://newsinfo.inquirer.net


The Bureau of Internal Revenue(BIR) has directed its tax collection efforts on erring professionals like lawyers, dentist, doctors, Certified Public Accountants and others who only pay a small or even not all on their income tax as required especially this upcoming tax season of which the deadline is on April 15.

An article in Inquirer.net gives the full detail why the tax bureau is keen on implementing and collecting tax by professionals in the Philippines. Below is a short excerpt of the article.

GreekGear.com

source: http://business.inquirer.net

BIR targets erring lawyers, doctors

Professionals paying less than P200K face audit

By
8:43 pm | Monday, March 18th, 2013

The taxman is closely watching the self-employed and professionals who are paying taxes at “ridiculously low” amounts as well as those who do not pay at all nor even register with the Bureau of Internal Revenue.

Internal Revenue Commissioner Kim S. Henares on Monday said she has signed an order that put professionals who pay less than P200,000 in taxes a year on top of the list of candidates for an audit.

In a briefing, Henares also said the BIR was considering to file charges against lawyers, doctors, dentists and others practicing a profession who pay less than P30,000 in taxes a year.

She said the BIR was embarking on a renewed campaign against professionals and would assert itself as a law enforcement agency and shed its image as a mere customer relations outfit.

Henares explained that underlying this so-called war against professional tax cheats was the aim of widening the tax base—specifically raising the number of those who actually pay taxes.

BIR documents showed that there were 1.8 million professionals registered with the agency, but only about 403,000 of them pay taxes. For those who do pay taxes, they turn in an average of only P33,000 a year, an amount which Finance Secretary Cesar V. Purisima described as “a joke” and “ridiculous.”

Purisima said the government wanted to bring the average inflow from professionals to P200,000 a year.

“Increasing the average to P200,000 per (self-employed) filer is reasonable,” he said, citing an estimate of yearly expenses for a family of four with two children in school. He said this family spent some P870,000 yearly on recurring expenses, which cover food, utilities, fuel for a vehicle, and tuition and pocket money for the children.

This “conservative” estimate also factored in that the family of a professional owned a sports utility vehicle worth about P1.8 million and a house worth P8.5 million.

With such purchases and properties, the family owed the government about P211,000 in tax.

However, Purisima said that during a recent tour of the BIR’s regional offices, he found out that some lawyers—for example—paid less than P1,000 for a year’s tax.

“Some lawyers in Bacolod paid P200 an entire year,” he said. “Some doctors and dentists in Mindoro paid just P429.”

go to http://business.inquirer.net to read full article

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It is better to pay your tax on time and correctly rather than making tax dodging tricks in order to pay what is due the Philippines. Lots of our kababayans argue that such tax money only go to the pockets of our corrupt politicians but nonetheless let us contribute to the progress our beloved Philippines is currently trying to achieve. If that is the argument we must be vigilant that our tax money goes to what it should suppose to be.

On the other hand if you incurred losses that are allowable deduction and resulted in net loss you got to seek the help of tax attorneys to help you get tax relief. Or if the tax is too huge and you have to available cash to pay it seek a tax lawyer who can help you make a reasonable tax settlement with the BIR and avoid tax debt.


If there is a saying that we have to watch the dignity of our ballot in elections, then we should also watch the correct use of your tax money.



Financial Freedom Advocate About the blogger

Louis Delos Angeles is a Certified Public Accountant, blogger behind Investing in Philippines, and author of Investing in Stocks: Preparing for the future small amount at a time. Check him out in Google+ Learn more about Louis and his financial freedom advocacy here.

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