An Overview of Percentage Tax

An Overview of Percentage Tax

In the Philippines, the term “Percentage Tax” refers to taxes which are levied from people or businesses that sells or leases goods, products and services whose annual sales/receipts are not greater than 1,919,500 PHP and of course, are not registered to VAT (Value Added Tax).

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Industries and Transactions Included

The Bureau of Internal Revenue (BIR) provided a list of all industries and transactions that you, as the individual/business should have engaged with in order to qualify for percentage tax filing.

Monthly Filing

For monthly filing of percentage tax, what you’ll need to have is BIR Form 2551M.

The ones who are required to file monthly percentage tax are people or businesses who had engaged with industries or transactions that are included in the list above.

Deadlines (Monthly)

The deadline of the manual filing of monthly percentage tax is within 20 days following each month’s end.

When it comes to electronic filing and payment system (eFPS), taxpayers should keep an eye out for these deadlines (provided by the BIR) for industries that are grouped in accordance with RR No. 26-2002 :

  • Group A – 25 days following the end of the month
  • Group B – 24 days following the end of the month
  • Group C – 23 days following the end of the month
  • Group D – 22 days following the end of the month
  • Group E – 21 days following the end of the month

Quarterly Filing

The ones who are required to file quarterly percentage tax are the following:

  1. One who acts as the operator, or manages the following businesses:Basketball games (professional)
    • Boxing exhibitions
    • Cabaret, day and night clubs, videoke and karaoke bars; and other related music lounges.
    • Race tracks and Jai-alai
    • Cockpits
  2. Telephone and communication businesses whose conversations and messages were originated and are transmitted from the Philippines.
    Forms and Deadlines (Quarterly)

When it comes to quarterly filing of percentage tax, you need to have BIR Form 2551Q.

As per deadlines for manual and electronic filing, both should be submitted within 20 days after the end of each taxable quarter.

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Visit www.juan.tax to learn more, or send us an email at help@juan.tax — we’d love to hear from you!