Businesses told to comply with TRAIN law

 

 

By Rose de la Cruz

 

Employers in private businesses should be able to iron out by March this year the transition kinks in implementing the TRAIN (Tax Reform for Acceleration and Inclusion) law’s exemption from income tax computations those being paid P250,000 a year.

 

Rep. Henry C. Ong, 2nd district of Leyte and vice chair of the committee on banks and financial intermediaries, said three months should be more than enough time to calibrat5e the payroll software most businesses use.

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

One probable reason many private sector employers are unable to implement TRAIN is that they have not yet finished their withholding tax computations for the 2017 taxable year. Those computations are the basis for the issuance of the withholding tax certificate to their employees. For taxable year 2017, the old income tax laws are still in effect.

 

He reminded income tax payers this early to file or prepare for filing their income tax returns on or before this year’s deadline, which is April 16 (April 15 falls on a Sunday).

 

Beginning next year, according to the TRAIN Law, the ITR filing deadline is on May 15. One reason the date was moved from April 15 to May 15 is the Holy Week holidays that sometimes fall on or the days before April 15.

 

He also reported that the BIR has recently issued four directives: 1) instructing taxpayers subjected to percentage tax and those required to withhold other Percentage Taxes and VAT, including VAT on government money payments and payments to non-residents; 2) directing all national government agencies to use BIR Form No. 0605 in the filing and remittance of creditable and final withholding taxes thru the Electronic Filing and Payment System; 3) for withholding agents to remit their creditable and final withholding taxes for the first two months of every quarter using BIR Form No. 0605 and indicating MC 200 for the ATC and WE or WF for the tax type, whichever is applicable; and 4) that all taxes withheld within the first two (2) months and on the 3rd month of every taxable quarter shall be remitted thru BIR Form 0605 and BIR Form 1601EQ, respectively.

 

Concerned taxpayers and employers must be guided accordingly, he said.

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