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Wrapping up your January tax checklist

In two days’ time, we are about to end the first month of the year. Time really flies so fast, especially when we are too preoccupied with loads of tasks that need to be done. It may be a bit too late now for some, but making a last minute run-down of our tax compliance to-do-list for January should not be given any less attention, even at this point in time. So waste not a single second, go grab that journal and desk calendar, and let us start ticking off the remaining items on your list.

Submission of computerized books of account. For taxpayers adopting a Bureau of Internal Revenue (BIR)-registered computerized accounting system, the submission of the Compact Disk-Recordable (CD-R), Digital Versatile Disk-Recordable (DVD-R), or other optical media containing the computerized books of account and other accounting records are due on Jan. 30, 2019.

Annual inventory list. For taxpayers engaged in business activities where inventories of stock-in-trade, raw materials, goods in process, supplies, and other goods are maintained (e.g., for construction, retail, manufacturing, or wholesale industry), another report that needs to be accomplished and submitted on or before Jan. 30, 2019 is the annual inventory list. This submission deadline applies if the taxpayer is adopting the calendar year for its accounting period. Soft copies of this annual inventory list, including other applicable schedules, must be submitted through in DVD-R format with a notarized certification duly signed by the taxpayer’s authorized representative, certifying that the data or information in the DVD-R are true and correct.

Summary list of regular suppliers. This information report may not be new to those classified as large taxpayers, Top 20,000 Private Corporations, or Top 5,000 Individual Taxpayers for quite some time. But, in case you are one of those included in the BIR’s October 2018 list of Top Withholding Agents, you need to update your checklist and make sure that you’ve included this in your to-do list this month. The Summary List of Regular Suppliers (SRS) of goods and/or services should be submitted on a semestral basis to the Large Taxpayer Assistance Division or Revenue District Office (RDO) where the taxpayer is registered on or before Jan. 31 (for the second semester: July to December) and July 31 (for the first semester: January to June).

Annual information return of income taxes withheld on compensation and final income taxes withheld. Also due every Jan. 31st is the filing of the Annual Information Return of Income Taxes Withheld on Compensation and Final Income Taxes Withheld. In 2018, the BIR issued Revenue Regulation (RR) No. 11-2018, which implements the separate submission of the Annual Information Return on Final Income Taxes Withheld (BIR Form 1604F) and the Annual Information Return of Income Taxes Withheld on Compensation (BIR Form 1604C). As of this writing, however, the BIR has not released the new forms yet. Since the deadline for submitting the said annual information returns is only a few days from now, taxpayers may have to use the old return form (BIR Form 1604CF) for taxable year 2018, until an advisory has been issued by the BIR. At any rate, be sure to watch out for relevant announcements or issuances from the BIR.

Aside from the annual information returns, taxpayers also need to ensure that the alphalist of employees’/income payees, which are required attachments to the returns, will also be submitted on time. Since alphalists are among the basic documents used by BIR examiners during tax audits, taxpayers must ensure that the information indicated are complete, accurate, and tally with the amounts declared in the monthly withholding tax remittance returns filed during the calendar year.

Distribution of certificates of compensation payment/tax withheld (BIR Form 2316). Employers must distribute to their current employees the Certificates of Compensation Payment/Tax Withheld or BIR Form 2316 on or before Jan. 31, BIR Form 2316 is a return that details an employee’s income earned during the calendar year with the corresponding tax withheld and remitted to the BIR by the employer. For employees who are qualified for substituted filing, BIR Form 2316 serves as their final annual income tax return; thus, they no longer need to file BIR Form 1700 on or before April 15.

Income payor/withholding agent’s sworn declaration. Under RR No. 11-2018, income payors or withholding agents shall execute a sworn declaration stating the number of income payees who have submitted their sworn declarations with the accompanying copies of their BIR Certificate of Registration (or BIR Form 2303). Such declaration of the income payors/withholding agents shall be submitted with the list of payees to the concerned BIR office where registered on or before January 31 of each year or 15 days following the month when a new income recipient has submitted the payee’s sworn declaration.

Annual registration. Most business entities are probably already done renewing their business permit with the local government units (LGU), the deadline of which was Jan. 20. Fortunately, some LGUs have provided extensions to taxpayers to settle their dues until end of this month.

As for the BIR, however, there is no extension for filing and paying the annual registration fee of P500, which is due on Jan. 31, 2019.

The to-dos above are only some of the general tax compliance requirements due every January. Depending on the industry, formation, or size of your business, there could still be other reports you may need to submit by the end of this month. It is important, therefore, that you double-check your list of to-do’s with reference to tax and other related issuances to make sure you have everything covered.

Now that you are done going through your list, how many have you completed so far? If you have ticked off most of your tasks, or maybe even all of them, congratulations! You will be wrapping up January with fewer things to worry about. But, if there are still unchecked items in your list, stay calm and be positive. Two days is still equivalent to 48 hours, anyway.


Arianne Cyril L. Mandac is a manager of the Tax Advisory and Compliance Division of P&A Grant Thornton.


As published in BusinessWorld, dated 29 January 2019