Here are the updates of withholding tax in the Philippines under the new tax reform- TRAIN law 2018. It includes…
Did you know that some taxes are confusing to the government to collect? One of these taxes is withholding tax train law. What is really the impact of train law on withholding tax? Does it make better or get worst? Let’s see the impact of train law on withholding tax.
In this article, you will know the increase or decrease in the withholding tax rate and any changes to creditable and expanded withholding tax. These updates discuss the new withholding tax rates, withholding tax tables and how to compute withholding tax. Let’s understand first what we should learn from this withholding tax under train law 2018.
Before we know the updates, it is best for us to know what withholding tax means. The amount of tax withheld is on the income of the recipient not covered by the income tax rate. The fee is withheld or deducted from the amount received by the recipient.
Tax withheld by the government can be refunded by the recipient if the total tax withheld is more significant than the actual fee to be paid by the recipient of income.
Some taxes could be challenging for the government to collect. Here are some updates of income that are subject to withholding tax.
Fifteen percent (15%) of a final tax capital gains from the sale of shares of stock not traded. It should be the net capital gains realized during the taxable year from the sale, barter, transfer, or other disposition of shares to stock in a domestic corporation.
Generally, all incomes realized by the non-resident alien individual not engaged in trade or business within the Philippines are subject to final withholding tax. In 2018, updates on capital gains from the sale of shares of stock not traded in the stock exchange were subject to fifteen percent (15%) of the final tax.
Latest Updates on Train Tax Law 2019:
Some of these updates include the interest income derived from the following:
15% Final tax withholding on the interest income from deposits under EFDCS. This withholding tax rate applies to capital gains realized during the taxable year from the sale, barter, exchange. Withhold 15% on the disposition of shares of stock in a domestic corporation is fifteen percent (15%).
The particular law mandates some benefits in the Philippines to all employees. These benefits are called as de minimis benefits. However, there are benefits given by the employer to a non-rank and file employees to pay their loyalty or longtime services and contributions to the company. These benefits could be a service, products, or in cash.
Any fringe benefits received by a citizen, resident alien or non-resident alien engaged in trade or business within the Philippines are subject to a thirty-five percent (35%) and twenty-five percent (25%) to any fringe benefits received by a non-resident alien not engaged in trade or business within the Philippines.
After learning the updates regarding withholding tax train law 2018 we must know also how to compute withholding tax under train law. Do you want to know how to do it? Are you practicing your profession or employed? If you want to know the estimated withholding tax from your employer, make sure you have your payslip before you proceed to the next instructions.
To know your withholding tax this month, read this article: 5 Steps on How to Use Tax Calculator 2018
Not all incomes earned are subject to withholding tax under the new tax reform. Only those incomes are not subject to the income tax rate. You read also the changes in withholding tax rate because of the implementation of train law. You may be interested to learn the latest BIR issuance 2019. Read the full article regarding updates about the income tax in the Philippines.
What else do you want to know about withholding tax train law? Please drop your comments so we can help you. Make sure to rate this article and share it before closing it.
This article will summarize the effect of train law on our Philippine Taxes. Train law has a great impact on… Read More
If you're buying real properties, make sure to have complete documents including the estate tax of the decedent and the… Read More