CINDY N.
BITONG BSA-2A
INCOME TAXATION
CY 2022-2023, First Semester
Aldersgate College, Inc.
Assignment
Topic: Chapter 4 Income Tax Schemes, Accounting Periods, Methods, and
Reporting
Discuss:
1. Types of Returns to the Government
a. Income tax returns- provide details of the taxpayer’s income,
expenses, tax due, tax credit, and tax still due the government.
b. Withholding tax returns- provide reports of income payments
subjected to withholding tax by the taxpayer-withholding agent.
c. Information returns
2. Mode of Filing ITR
a. Manual Filing System- the traditional manual system of filing
income tax return is by paper documents where taxpayers fill up
BIR forms to report income, expenses or any declaration required
to be filed with the BIR.
b. E-BIR Forms- Taxpayers fill up their ITR in electronic spreadsheets
without the need of writing on papers returns.
c. Electronic Filing and Payments System (eFPS)- a paperless tax
filing system developed and maintained by the BIR. Taxpayers file
tax returns including attachments in electronic format and pay the
tax through the Internet.
3. Determine the taxpayers who are mandated to use the eFPS
a. Large taxpayers duly notified by the BIR
b. Top 20,000 private corporations duly notified by the BIR
c. Top 5,000 individual taxpayers duly notified by the BIR
d. Taxpayers who wish to enter into contracts with government offices
e. Corporations with paid-up capital of P10,000,000
f. PEZA-registered entities and those located within Special
Economic Zones
g. Government offices, in so far as remittance of withheld VAT and
business tax are concerned
h. Taxpayers included in the Taxpayer Account Management
Program (TAMP)
i. Accredited importers, including prospective importers required to
secure the Importers Clearance Certificate (ICC) and Custom
brokers Clearance Certificate (BCC)
4. Grouping of Taxpayers under EFPS
1. Group A
a. Banking Institutions
b. Insurance and pension funding
c. Non-bank financial intermediation
d. Activities auxiliary to financial intermediation
e. Construction
f. Water transport
CINDY N. BITONG BSA-2A
g. Hotels and Restaurants
h. Land transport
2. Group B
a. Manufacture and repair of furniture
b. Manufacture of basic metals
c. Manufacture of basic chemicals, and chemical products
d. Manufacture of coke, refined petroleum, and fuel products
e. Manufacture of electrical machinery, and apparatus NEC
f. Manufacture of fabricated metal products
g. Manufacture of foods, products, and beverages
h. Manufacture of machineries and equipment NEC
i. Manufacture of medical, precision, and optical instruments
j. Manufacture of motor vehicles, trailers, and semi-trailers
k. Manufacture of office, accounting, and computing machineries
l. Manufacture of other non-metallic mineral products
m. Manufacture of other transport equipment
n. Manufacture of other wearing apparel
o. Manufacture of papers, and paper products
p. Manufacture of radio, TV, and communication equipment, and
apparatus
q. Manufacture of rubber and plastic products
r. Manufacture of textiles
s. Manufacture of tobacco products
t. Manufacture of wood and wood products
u. Manufacture of N.E.C
v. Metallic ore mining
w. Non-metallic mining and quarrying
3. Group C
a. Retail Sale
b. Wholesale trade and commission trade
c. Sale, maintenance, repair of motor vehicle, and sale of automotive
fuel
d. Collection, purification, and distribution of water
e. Computer and related activities
f. Real estate activities
4. Group D
a. Air Transport
b. Electricity, gas, steam, and hot water supply
c. Postal and telecommunications
d. Publishing, printing, and reproduction of recorded media
e. Recreational, cultural, and sporting activities
f. Recycling
g. Renting out of goods and equipment
h. Supporting and auxiliary transport activities
5. Group E
a. Activities of membership organizations Inc.
b. Health and social work
c. Private educational services
d. Public administration and defense compulsory social security
CINDY N. BITONG BSA-2A
e. Public educational services
f. Research and development
g. Agriculture, hunting, and forestry
h. Farming of Animals
i. Fishing
j. Other service activities
k. Miscellaneous business activities
l. Unclassified activities
5. Modes/systems of payment of income taxes
Manual e-BIR Forms eFPS
Data Entry Manual Electronic Electronic
Filing/Submission Manual Electronic Electronic
Tax Payment Manual Manual Electronic
6. Penalties for late filing or payment of tax
1. Surcharge
a. 25% of the basic tax for failure to file or pay deficiency tax on
time
b. 50% for willful neglect to file and pay taxes
2. Interest- double of the legal interest rate for loans or forbearance of
any money in the absence of any express stipulation
7. How to identify a leap year?
A year divisible by 4 with a whole number quotient without a
decimal is a leap year. Years 2016, 2020, 2024, 2028 and so on
are leap years. Leap years have 29 days in February hence the
actual number of days in a leap year is 366 not the usual 365. This
is due to the fact that our planet revolves around the sun in 365 ¼
days. Hence, there is an extra one complete day in every four
calendar years.
8. Penalties for non-filing or late filing of information return
For each failure to file a separate information return, statement or
list, or keep any record, or supply any information required by the
Code or by the Commissioner on the date describe therefor, unless
it is shown that such failure is due to reasonable cause not to willful
neglect, shall be subject to a penalty of P1,000 for each such
failure. Provided that the amount imposed for all such failure during
a calendar year shall not exceed P25,000.
