HOW TO BE A BIR TAX AGENT?

HOW TO BE A BIR TAX AGENT?

By: Ione Mejia

IS THE ONE DOING YOUR TAXES AN ACCREDITED BIR TAX AGENT?

DO YOU WANT TO BE AN ACCREDITED BIR TAX AGENT?

Read on, this is for you.

So, what exactly is  a tax agent?

Tax agents/practitioners as per BIR Revenue Regulation 11-2006 are the ff:

     1. those engaged in the regular preparation, certification, audit, and filing of tax returns, information returns or other statement or reports required by the Code or regulations

     2. those who are engaged in the regular preparation of request for ruling, petitions for re investigation, protests, requests for refund or tax credits certificates compromise settlement and/or abatement of tax liabilities and other official papers and correspondence with the Bureau of International Revenue and other similar or related activities

         3. those who regularly appears on meetings, conferences, and hearing before any office of the Bureau of Internal Revenue officially on behalf of the taxpayer or client in all matters relating to a client's right and privileges, or liabilities under laws or regulations administered by the BIR

Those engage in the tax practice above are required to apply for accreditation.
(Section 2(e) RR 11-2006)

WHO ARE REQUIRED TO REGISTER?

1. Individual tax practitioner engaged in private practice who are Certified Public Accountant (CPA's); CPA-Lawyers who issue/sign auditors certificate or otherwise perform functions exclusively pertaining to a CPA; and individual other than CPA's who meet the qualifications prescribed in these Regulations;

2. Partners of a General Professional Partnership (GPP) engaged in the practice of taxation, accountancy, and/or auditing; their duly authorized officers or representative who regularly appear or otherwise engage in tax practice before the BIR.

3. General Professional Partnership engaged in the practice of taxation, accountancy and auditing who regularly appears or otherwise engaged in tax practice before the BIR.

4. Officers or duly authorized representatives of incorporated business entities engaged in accounting, auditing or tax consultancy services.

WHAT ARE THE QUALIFICATION OF APPLICANTS?

SECTION 4 ( RR 11-2006)  - Minimum qualification of Applicants - In general, the grant of accreditation shall be based on the applicant's professional competence, integrity and moral fitness. Along these lines, the following are hereby prescribed:

A. FOR THE INDIVIDUAL TAX AGENTS  ( other than member of the Philippine bar)
 
       1. He must be  Certified Public Accountant ( CPA) with current professional license from the Professional Regulations Commission (PRC).

       2. If he is not a CPA, he must have obtained at least a degree in law, Juris Doctor (JD) or it's equivalent, or a Bachelor's degree in Arts, Commerce or Business Administration with at least (18) units in accounting and/or taxation in a college or university recognized by the Department of Education, Culture and Sports (DECS)/ Department of Education (DepEd), Commission on Higher Education (CHED) or in a foreign school of known repute or one duly recognized by it's government. In addition , he must be able to demonstrate or present convincing proof of special competence in tax matter or tax practice, ex. previously acquired experience; at least (18) credit hours of special training, seminars, short ern course, etc. in taxation obtained not more than one (1) year prior to the application of the accreditation , subject to evaluation and approval of the Board;

     3. He must be of good moral character as certified under oath by at least two (2) disinterested persons who are either members of the Philippine Bar or A Certified Public Accountants in good standing.

     4. He must not have been charged with and convicted with final judgement of a crime involving moral turpitude, or found guilty of any act or omission penalized under the Tax Code, or found guilty of aiding or abetting or causing the commission of any such offense by another, and.

      5. He must be a citizen of the Philippines.

    6.  He must have completed at least six (6) hours per year or total of eighteen (18) hours for the three years of continuing professional education (CPE) in taxation from training/seminars conducted by the BIR ( Ex. Revenue Regions, Revenue District Offices, etc.) or from private institutions ( ex. tax/auditing firms, educational or training institutions, professional organization, etc. ) where the number of training hours earned are printed on the certificates and obtained not more than a year prior to the application/renewal for accreditation.


B. FOR GENERAL PROFESSIONAL PARTNERSHIP - In case of GPP's engaged in the exercise of professional accountancy, auditing or tax consultancy services (other than general professional partnerships engaged in the practice of law), the application for accreditation files by the partners and/or the duly authorized officers and representatives therefore shall conform with the ff:

   1. The partners and duly authorized officers or representatives thereof must meet all the qualifications of an individual tax agent as prescribed in the Section 4(A) hereof. In lieu of the submission of documents or proof thereof, said qualifications may be certified to under oath by managing partner of the firm; and

      2. The partnership is one registered with Securities and Exchange Commission.

C. IN THE CASE OF INCORPORATED ENTITIES engaged in accounting and tax consultancy other than general professional partnerships:

     1. the firm must be registered with the Securities and Exchange Commission (SEC);and

    2. The applicant-officers or duly authorized representatives thereof must meet all the qualfications of an individual as prescribed under Section 4(a) hereof.

WHAT ARE THE ACCREDITATION PROCEDURES?

SECTION-5  (RR 11-2006)
I-  WHERE TO FILE?

All applicant shall accomplished their application for accreditation in the form to be prescribed by the Commissioner of Internal Revenue. The duly-accomplished application form shall be submitted together with all documentary requirements prescribed in the (B) (1) or (2) of this Section, whichever is applicable with the Regional Revenue Accreditation Board (RRAB) of the place where the individual applicant or general professional partnership has his/it's residence or principal place of business.

Individual applicants and GPP's who are duly accredited by the BOA and SEC, however, shall submit their sduly accomplished application form together with the documentary requirements prescribed in the items (B)(3) of this Section with the Revenue National Accreditation Board (RNAB).

II - WHAT ARE THE DOCUMENTARY REQUIREMENTS?
SECTION 5. ACCREDITATION ( RR 11-2006)
Applicants shall submit togehter with their duly accomplished forms, the following documents:

1. FOR INDIVIDUAL APPLICANTS:

      A. Certificate of registration with the Board of Accountancy (BOA) and current license with the Professional Regulations Commission, if a CPA, or Attorney's Roll Number and Mandatory Continuing Legal Education (MCLE) Compliance Number, if a Lawyer.

     B. Certificate of membership in Good Standing with his/her/its PICPA Chapter or ACCPA (for  CPAs) or Integrated Bar of the Philippines (for lawyers)

    C. Certificate of Good Moral Character issued by two (2) disinterested person, who are either member of the Bar or Certified Public Accountant of good standing; and

       D. If non Certified Public Accountant (CPA):
              1. Certified copy of transcript of records from the university or college showing compliance with at least eighteen (18) units in accounting or taxation as prescribed in Section 4 (A) (2).

           2. Written certification of continuing professional education (CPE) units of at least six (6) hours per year or total of eighteen (18) hours for the three years in taxation conducted by BIR ( ex. Revenue Regions, Revenue District Offices, etc.) or from private institutions ( ex.tax/auditing firms, educational or training institutions, professional organization, etc.) where the number of training hours earned are printed on the certificates and obtained not more than a year prior to the application/renewal for accreditation.


2.  FOR THE PARTNERS, DIRECTORS, OFFICERS, OR DULY AUTHORIZED REPRESENTATIVES OF GENERAL PROFESSIONAL PARTNERSHIP AND INCORPORATED ENTITIES ENGAGED IN ACCOUNTING AND TAX CONSULTANCY.

             A. Certificate of Good Moral Character issued by two (2) disinterested person, who are either member of the Bar or Certified Public Accountant of good standing; and

           B. Other applicable requirements for an individual applicant, or in lieu thereof . certification under oath by the managing partner(s) that the applicant acting for the firm possesses all the qualifications prescribed under Section 4(A) of these regulations.

      C. For those partners, Directors, Officers or duly authorized representatives of General Professional Partnership duly registered with the SEC, in addition to the above documentary requirements, a certification from the BOA of the said Partner, Director, Officers or duly authorized representative is a CPA. Provided, however, that the requirements under letters a,b and c of Section 5(B)(1) hereoof need not be submitted if the Professional Partnership can submit a certified true copy of it's SEC Certificate of Accreditation as well as BOA Certificates of Registration of all the partners, officers, and representatives of the Professional Partnership of CPA's.

             D. List of all current partners, directors, officers, associates or representatives duly authorized by the GPP to act on it's behalf in representing it's client before the BIR.


3. FOR THE INDIVIDUAL AND GPP'S ACCREDITED BY BOA AND SEC.

           A. Certified true copy of BOA Certificate of Registration

          B. Certified true copy of SEC Certificate of Accreditation.


III- PROCESSING FEE

Each applicant shall pay a non refundable processing fee of Five hundred pesos ( P 500.00) upon filing of his application for accreditation. If the applicant is a general professional partnership (GPP), the fee shall be paid by each partner and authorized representative thereof. In the case of incorporated entities engaged in accounting and tax consultancy services, the fee shall be paid by each of the applicant  officers or designated representative thereof.

EFFECTS OF ACCREDITATION
(Section 9 of RR 11-2006 is hereby amended to read as follows, RR 14-2010)

Only those Tax Agents/Practitioners. Partners or officers of General Professional Partnership, or officers or Directors of corporate entities engaged in tax practice who have been issued Certificate of Accreditation or ID card shall be allowed to represent a taxpayer or transact business with the Bureau of Internal Revenue in representation of a taxpayer for the purpose defined in this regulations. THE COMMISSIONER OR HIS AUTHORIZED REPRESENTATIVE SHALL ONLY CONSIDER AS VALID DOCUMENT /ATTACHMENTS TO TAX RETURNS, INFORMATION RETURNS, OR OTHER STATEMENTS OR REPORTS REQUIRED BY THE CODE OR REGULATIONS, THE FINANCIAL STATEMENTS PREPARED, SIGNED AND CERTIFIED BY DULY ACCREDITED TAX PRACTITIONERS. The BIR can refuse to transact official business with tax practitioners who are not accredited before it and shall require that certain official statements such as returns, financial statements, reports, protests, request for ruling, official correspondence and other statements, paper, documents filed on behalf of a taxpayer be signed  or certified persons which shall bear the following information below the signature of the latter.

A. For individual's (CPA's, member of GPP's and others)
           1. Tax Identification Number (TIN) and
           2. BIR Accreditation Number, Date of Issue, and Date of Expiry

B. For members of the Philippine Bar (lawyers)
         1. Tax Identification Number (TIN)
         2. Attorney's Roll Number 
        3. Mandatory Continuing Legal Education (MCLE) Compliance Number; and
        4. BIR Accreditation Number, Date of Issue, and Date of Expiry

If you need assistance, tax advice and tax help, contact us TAXINSIDER



Source: BIR Revenue Regulation Number 11-2006
             BIR  Revenue Regulation Number 14-2010

Freelancer's guide to paying tax - Part 1

FREELANCER'S GUIDE TO PAYING TAX 
by: Ione Baron-Mejia

Image from rabidbi.com

"Freelance ain't free therefore you're income's taxable."

"Tulungan mo naman ako sa tax ko." "Ano bang gagawin ko? " "Pano ba mag online" "Pwede bang ikaw na lang gumawa ng tax ko? " These are the things i usually here from my friends who are also freelancers. I figured, i better write about this,  so the next time i hear  another soul lost on what to do with their tax, i'm just going to send them link,  to this blog, makes life a little easier. This is also to help other freelancers in dilemma as to what and how to pay their taxes. 

First things first.

Anong klaseng taxpayer ka muna?

There are two major kind of taxpayers:

I. Individual

II. Corporation

Ang mga freelancer ay Individual taxpayer.

May dalawang klase ang Individual Taxpayer

Individual taxpayer can be classified as:

I-A. Citizen

I-B, Alien

 Ang mga freelancer ay classified na Citizen na Individual Taxpayer.

IA - CITIZENS are classified as:

IA-1.Resident citizen - Pilipino na nakatira at nagtratrabaho sa Pilipinas

IA-2. Non resident citizen - Pilipino na hindi nakatira at nagtratrabago sa ibang bansa. 

    IA2-a. Immigrants

    IA2-b Employees of foriegn entities on apermanent basis

    IA2-c. Overseas Contract workers or (CW)

Freelancers are classified as Resident Citizen

 Aliens are either resident of nonresident. Nonresident aliens are further divided into engaged or not engaged in trade or business in the Philippines. If an alien has an aggregate period of stay here in the Philippines for more than 180 days he shall be considered as a “nonresident alien doing business in the Philippines.”

What are the sources of income of resident citizens taxable under the Philippine law?

Ans. All income derived from sources within and without the Philippines.

In short lahat ng kita mo sa Pilipinas o sa ibang bansa man yan taxable yan.

Ngayon alam na natin kung ano ang taxable income mo,  kung ano ang kailangan mong ireport na kita.

Tanong: Freelancer artist ka, may raket ka sa Pilipinas, meron ka ring raket sa ibang bansa.  Kita lang ba sa Pilipinas ang taxable? Mali. Lahat ng kita mo kahit saan man yan sa mundo kinita,  taxable yan under Philippine law. 

What are the sources of income of  nonresident citizens taxable under Philippine law?

A nonresident citizen is taxable only one income derived from sources within the Philippines. Thus an immigrant, employee of a foreign entity on permanent basis and OCW will be taxed only on income derived from the Philippines. His income from the country where he is working will not be taxed in our country. 

In short, kung nonresident citizen: Kita lang sa Pilipinas ang taxable same with aliens. 

What sources of income of  aliens taxable under Philippine law?

An alien individual, whether a resident or not of the Philippines, is taxable only on income derived from sources within the Philippines.

Self employed taxpayers are those individual who receive income from business ( sole proprietorship)  or/and  from practice of profession ( registered or not registered with the PRC (Professional Regulation Commission) such as CPA's, lawyers, doctors, engineers, architects, dentist,artists, bloggers, media practitioners). Freelancers are self employed taxpayers.  

SELF EMPLOYED KA OR FREELANCER, WHAT'S NEXT?


First thing to do is to register in BIR. 


First: Go to BIR's office. I assume you already have your TIN. If not, you have to register here first.

https://ereg.bir.gov.ph/ereg/welcome.do


Your Revenue District Office ( RDO) depends on your business address that you will be using. If you are a freelancer and working at home, you can use your residential address as your business address. ( Isa yan sa laging tinatanong wala naman akong business address, kung wala kang business address yong home/ residential address mo ang gamitin mo, pwede yon. Check your RDO below. 

http://www.bir.gov.ph/index.php/contact-us/directory/revenue-district-offices.html


2nd:  the BIR will ask you for your license if you tell them your are applying as self employed or a professional. You can show them your PRC ID, if your  industry doesn't require one, just inform them about it, they will understand.


3rd: Fill up a registration form, you will have to use BIR form 1901 and BIR form 605, which is payment form. You need to pay (P500.00 ) five hundred pesos for your registration fee. 
Where do you pay? You need to go to the authorized bank of your RDO, these are the banks usually within your area, check the link below. 

http://www.bir.gov.ph/index.php/list-of-authorized-agent-banks.html



4th:  You need to submit the following documents together with the BIR for 1901.
1. Prepare your registered TIN Number
2. Xerox copy of your birth certificate
3.  If your are married, xerox copy of your marriage certificate and birth certificate/s of your dependents/children
4. Xerox copy of your ID with name, address and signature.
5. Xerox copy of your proof of address.
( The BIR may ask if your are renting your office. They will require you to submit  lease contract if you are renting your office if you have an office,  then you have to pay docs stamps for that.)

5th: Register your books.
Journal, Ledger, Cash receipt Journal and Cash Disbursement Journal
( Buy these from bookstore then bring it to BIR para tatakan nila)


6th: Look for an accredited printer who can assist you with printing your invoices. Or you can ask BIR personnel for recommendation, usually may kakilala sila para mas mabilis.



You can allocate at least one whole day for these.  Go to the BIR office with the BIR form 1901, BIR form 605 for registration fee together with the required docs and the books. Then go to the bank for the registration fee, go back to BIR and submit the payment form. They will then inform you when to go back for the Certificate of Registration. 


Congratulations! You are now regisitered in BIR. You can now start paying your taxes. :-)



If you need assistance or tax help, contact us @ TAXINSIDER.