Comments on: Is Taxation Taxing You Up? I’ll Help You. For FREE!

By: Fritz

Fritz — Sun, 29 Mar 2009 13:47:28 +0000

Hahaha, hindi ah. Hey, Dan, thanks for the correction with the OSD rate. Seems like my numbers got stuck in the year 2003 LOL. Salamat ule. Edited my reply to Mia with 40% just as you said. Cheers!

By: Adan

Adan — Sun, 29 Mar 2009 10:24:23 +0000

Fritz, I never realized how popular you are in the blogging community. May award ka pa. ;-) Nice blog! Btw, OSD is now at 40%; I suppose the 3% tax your friend Mia is talking about is the percentage tax on professionals not covered by VAT. Good luck pre. I like the domain name ;-)

By: Fritz

Fritz — Thu, 26 Mar 2009 14:27:45 +0000

Hi Mia, I would like to know the nature of the 3% withholding tax. Will the hospital issue a tax certificate for this (like the withholding tax from source certificate you mentioned)? Actually, my offer for “help” has prescribed but since you made an effort to write a very lengthy comment, I’ll indulge a request this one last time, haha!

You asked if you will need to claim an optional standard deduction since you are registered as a professional. My answer: yes you may may but still do consider itemizing your necessary business expenses (gas, parking, instruments, supplies, and the like). I’m saying this because your total annual business expenses may add up to more than (edited per Adan’s comment) 40% of your gross income (40% is the rate of the optional standard deduction for expenses) and ultimately make you pay a little less than what you ought to in taxes come April.

You are aware that you may have to shell out cash for “annualized” taxes, yes? Let me elaborate. The hospital withholds 10% from your income on a per payout basis. Come April, professionals and “individuals earning purely compensation income” (aka “waged” people, like me) are subject to the same graduated rate ranging from 5% to 32% of our net taxable income. If your income has crossed the 500k threshold, the maximum in the tax table, then anything you earn in excess will be subject to 32%. Tax for the first 500k is a flat rate of 125k. What makes you different from “wage earners” is you get to claim expenses. The option is either to settle with the “optional standard deduction” (which is 40% as I’ve mentioned) or “itemize.”

As for filing joint, you may not file a joint return to reflect that of your husband’s income from overseas. They have a “special” tax procedure which exempts them from filing “joint” with their resident citizen spouses. It’s one of the few instances where married individuals are allowed to not file “joint.”You will still claim 50k as personal exemption as a “married” individial, though.

I hope this somewhat clarifies some of the questions that have been bothering you. At least you are concerned with filing. Others aren’t. If you need further clarification, email me at fritz.tentativa at gmail dot com.

By the way, you are filing quarterly income taxes, are you? I guess not. It’s required, though. Form is used is 1701Q.

By: mia ayala

mia ayala — Wed, 25 Mar 2009 11:27:47 +0000

Hi Fritz! I really hope you can help me. All my friends are doctors and nurses, they are not exactly helpful during these tax-paying times hehe. Ive worked as a goverment doctor for the past years, and now that im a retainer company doctor, i am forced to file my taxes on my own. I really have no idea how to file my taxes. I am registered as a self employed professional. I just recently found out that we are required to pay an additional 3% monthly tax of the monthly gross. I just dont know how come some doctors are not aware of this 3% monthly tax. Is it optional then or mandatory? Second question, the company I work for already gets 10% from my salary monthly and submits to me a form (Tax withheld at source form -?) I have to file my annual taxes this before april however i do not know how to fill up form 1701. I’ve even visited the BIR website but it really has not been helpful at all. I dont know which to deduct or add. I am married to a marine engineer (seaman), should I still fill up the spouse side of the form? I am married but without kids, should I opt for an optimal standard deduction or itemized deduction? gosh I really need help! If you have any medical-related problems, I would happily assist you in return. I hope to hear from you soon! Maraming salamat!

By: Fritz

Fritz — Thu, 13 Sep 2007 20:28:55 +0000

This offer has expired. SRY.

By: benj

benj — Thu, 30 Aug 2007 03:18:33 +0000

Thanks for the affirmation…

*bata pa ko* *bata pa ko* *bata pa ko* …