Online Tax Return Filing and Payment in the Philippines

By: Tax and Accounting Center Philippines

To provide a more taxpayer convenient manner of filing and payment of tax liabilities, electronic filing and payment system (EFPS) in the Philippines was introduced early in 2001 under Revenue Regulations No. 9-2001. The online tax payment system also fast tracked the availability of tax revenue for the Bureau of Internal Revenue (BIR) as payment is directly credited to the account of the government.

How does online system works?

Taxpayers intending to use online facility are required to enrol with the EFPS facility of the BIR. They are likewise required to maintain an online banking facility where the EFPS facility is integrated. Upon successful enrolment with both EFPS and online banking, the EFPS taxpayer will simply access the online facility, fill-out the tax return fields with required details and have it filed online. It is a two-step process and for control purposes, two persons normally operate – a staff for online filing, and an executive for online payment with access over online bank facility. Of course, it might be a bit risky to entrust online banking access to the staff so the superior ones does the online payment authorization. Upon successful online filing and payment, the system will generate a filing reference and payment confirmation as proof of successful tax payment. The system will likewise store EFPS files of tax returns files for future reference.

Benefits of online tax payment system

The online tax filing system is actually convenient for EFPS taxpayers. Here are some notable advantages:

1. No need for personal bank appearance to pay and file tax returns;
2. No need for manual stamping with the BIR office;
3. Beating the red light is not tight because final hour is until 10:00PM of the filing date as compared to the banking hours for payment (e.g. 3:00PM or 4:00PM for some banks);
4. Preparation of managers/cashiers checks for payment (or company check in some instances) is no longer needed as payment is attached to an online facility;
5. Tax returns are automated and no need for manual computation as some fields with mathematical computations automatically operates;
6. Filing can be done at your own pace and time based on an internet connection;
7. Drop downs for applicable fields such us on alphanumeric tax codes (ATC) are available and no deed to search for them manually; and,
8. Printing may be dispensed with because the system will store your filed returns that you may print later, although printing every after filing and payment is recommended;

As you can see above, filing and payment of tax return online is made easier, simplified, and convenient. We would expect that someday, online payment would open up for more facilities like paypal, credit card, and other modes for online merchants.

Who can avail of the online tax payment system in the Philippines?

The EFPS initially kicked off for large taxpayers with respect to some tax returns in the past but later developed. It has been made open to all taxpayers wishing to avail of the EFPS at their option, and almost all tax returns are now available for EFPS filing. However, certain taxpayers are mandated to file their tax returns via EFPS such as the following:

1. Large Tax Payers duly notified by the BIR
2. Top 20,000 Private Corporations duly notified by the BIR
3. Top 5,000 Individual Taxpayer duly notified by the BIR
4. Taxpayers who wishes to enter into a contract with government offices
5. Corporations with a paid- up Capital stock of Ten million pesos (₱ 10,000,000.00)
6. PEZA registered entities and those located within the special economic zones, and,
7. Government offices in so far as the remittance of withheld VAT and business tax is concerned (under Revenue Regulations No. 1-2013)

Private entities included above who are not registered in eFPS shall enroll following the procedures set forth in RMC 24-2001. Before enrollment  the RDOs concerned shall conduct briefing on the use of eFPS which all enrollees are required to attend as a pre-requisite to enrollment.

For more details and information, please refer to the link for frequently asked questions on electronic filing and payment (https://efps.bir.gov.ph/eFPSFAQ.html). We suggest you visit the BIR revenue district office of registration for your intended electronic filing and payment system in the Philippines. You can also visit the BIR link on how the EFPS facility developed based on the number of BIR issuances –  https://efps.bir.gov.ph/eFPSIssuancesAndRulingsPage.html.

Disclaimer: This article is for general conceptual guidance only and is not a substitute for an expert opinion. Please consult your preferred tax and/or legal consultant for the specific details applicable to your circumstances. For comments, you may please send mail at info@taxacctgcenter.org.