Mid March 2019, my team (Taxumo) was introduced to the GrabPay team of Grab. We were introduced by Ms. Diane Eustaquio, the Executive Director of Ideaspace. As some of you may know, we were part of Batch 4 of this incubator/accelerator program, and it has helped us a lot in our start-up journey.
I remember the first time we met with the GrabPay (Grab Philippines) team. They really and sincerely wanted to help with the mission of making it easier for every one to pay taxes. After the first meeting, everyone in each of the teams were committed to make this happen.
Since April was a busy season for us, we agreed to start integrations by May 2019. Integrations only took us a month and for marketing, our go-to-market strategies were laid out after.
We’ve actively started promoting our partnership this month (July 2019).
How will this partnership benefit me?
You can get huge savings when it comes to paying your taxes, particularly on the Taxumo processing fees.
For one, when you pay your taxes using GrabPay Credits for the months of July and August 2019, you get Php 100 OFF on Taxumo Processing Fees.
All you need to do are the following:
Step 1: Key in your income and expense receipts in Taxumo then view your Tax Dues Cards to check on the amount of taxes that you need to pay
Step 2: Choose GrabPay as the payment option and click on payment. It will immediately confirm if you have enough balance in your Grab App (GrabPay Credits) so be sure that you have enough GrabPay credits.
Notice that you will automatically have Php 100 OFF.
The second benefit is that you can get more Taxumo Xennies (usually 1 Xenny is equivalent to 1 Peso). Taxumo Xennies can be used to pay Taxumo Processing fees and to upgrade your Taxumo Plans.
You can now purchase Taxumo Xennies using GrabPay Credits. The best deal that you can get is paying Php 250 for 550 Xennies!
So if you really want to upgrade your Taxumo account and have access to our books of accounts view (if you don’t know how to fill out those manual ledgers) or if you want to get around 50%+ off on Taxumo Processing fees, now it the time to STOCK UP ON XENNIES!
Personally, my dream really for these kinds of integrations with partners, is to have a country where you can pay taxes anytime, anywhere. A country where tax payers pay their duties while commuting, while waiting for the next episode on Netflix, while standing in line in the recently opened ShakeShack… basically, anywhere!
We also welcome new ideas that you may have. If you have an idea that you think will work well for Taxumo, message us at email@example.com!
Hear ye, hear ye! Taxumo has a new and improved dashboard that offers so much more than just tax filing. It now has some form of analytics (cool charts and all!) that shows you your income and expenses and what your top expenses are as a business.
For long time users, you may be surprised to see that the first thing you see is the dashboard and not the “CASHFLOW” tab. If you want to ADD an Income or an Expense Entry, feel free to click on the Cashflow tab on the left side or one of the Cards in the Dashboard.
We changed how we called the tab for setting up your account from “COMPANY” to “SETTINGS”. When you first created your Taxumo account, this is what you were filling out. Feel free to visit this page again as we have simplified the fields the best way we can. We have some guides that you can click on; those are the little question marks seen at the side of each field.
Tax Dues Tab
Tax dues are now in the tax due tab and are grouped per tax type. We also have a reminder on actionable steps that you need to take. For late filings, we have also highlighted them just in case you have missed them.
If you want to view your past filings, click on the Past Filings tab. If you accidentally marked a tax card as paid, you can go to the Hidden Filings tab and unhide it.
We have fixed our payment checkout page. We have heard your requests for us to add more payment channels! We are proud to say that in the coming months, you will see more and more payment options — options that will make it easier for you to file and pay your taxes anytime, anywhere!
#TeamTaxumo is honored to partner with GrabPay! When you file and pay via GrabPay Credits starting July 1, 2019 (until August 31, 2019), you will get a Php 100 off on Taxumo’s processing fees.
Xennies! Get or Earn Taxumo Credits!
We have introduced Xennies! Xennies are Taxumo’s Credits that can be used to pay for your Taxumo Processing fees. There are two ways to get hold of Xennies.
One is to share your own referral code to your friends and family. To set your referral code, click on your name at the top portion of Taxumo’s screen. Click “My Account” and it will direct you to your Xennies Transaction History page. You can earn 100 Xennies for every friend or family that successfully files a form via Taxumo.
Another way to get Xennies is to purchase Xenny Packs. These are available for sale inside the Taxumo Platform. 1 Xenny = 1 Peso. We have a promo running now with GrabPay. Get 10% to 100+% credits when you purchase using GrabPay.
So there you have it folks! These are the changes in the system. If you have any other suggestions, feel free to email firstname.lastname@example.org 🙂
Every January 2, I usually prepare all of my current Business Documents. I’m registered as a Sole Proprietorship. This means that I have to renew my documents with both the Local Government Unit / Municipal Hall and with the Bureau of Internal Revenue or BIR. Usually, I need to go to both places, which is such a hassle!
But guess what? This year, because of Taxumo, life became easier! You can now renew your 2018 Certificate of Registration or COR (file and pay form 0605) via Taxumo!
What Happens If I Don’t Renew My Certificate of Registration?
To avoid penalties, the deadline for renewing your Certificate of Registration would be January 31. Failure to renew this would incur fines ranging from PHP 5,000 to PHP 20,000.
What Is the Standard Process of Business Renewal vs. the Taxumo Way?
The standard process for renewing your Certificate of Registration would be:
Go to your RDO (Revenue District Office) and submit a fill-out BIR Form 0605
The officer of the day will then compute the fees that you need to pay
You need to settle the payment at an Authorized Agent Bank (AAB), duly accredited by the BIR in your RDO.
The standard process could take hours, because of the number of people who will have to renew. If you value your time, just do it online!
With Taxumo, you just pay your Certificate of Registration online, without the stress.
Here are the Steps to Renew Your COR via Taxumo:
If you already have an existing Taxumo account, all you need to do is activate the 0605 Form on your company profile.
To do this, simply follow the steps listed below.
Go to your company profile
Scroll down until you see the forms that you need to file.
Check on the 0605 form and click the save changes button.
Go to your account dashboard and click on the file button.
Fill-up the form details (applicable date if you’re paying for 2019 is Dec. 31, 2019)
Choose your preferred payment method and click pay.
That’s it! You’re done.
It’s super easy!
Note that this process is only for renewing your BIR Certificate of Registration. Again, if you are a sole proprietorship, have a partnership or corporations, you still have to renew you other business documents (baranggay clearance and business permits) in the LGU / Municipal hall.
Are you one of those freelancers who still ask why you need to pay your taxes?
I have heard many freelancers express their fear and disappointment about paying their taxes. “Why should we pay when we don’t have a stable income?” “Why should we pay when we can hide what we earn since we earn online?… the government doesn’t have to know!” Well, for the record, it’s not only freelancers who feel this way. For the longest time, this has been the sentiment of Filipinos in general.
It’s tough to live in a country where tax laws are so complicated. These laws are so complicated that you end up not paying at all. It’s difficult balancing understanding taxation with looking and working for clients as a freelancer. There’s just not enough time.
If you are facing these same dilemma as a freelancer, then I am here to tell you that there is nothing to fear. Instead of thinking of all of the disadvantages, let me share with you why I pay taxes as a freelancer. Let me give you the lo down why it’s actually beneficial to pay taxes and become “legit” self-employed individuals.
Enjoy your income! Enjoy being a Freelancer.
What good is hard-earned money when you can’t enjoy it. We all want to travel, have cars, own a house, etc. But in order to get our VISA approved or our car or home loans approved, we need to show proof of income. Since we are not “employed”, we don’t have a payslip to show or a Certificate of Employment to present. The chances that our VISA will be denied is high.
When you regularly pay your taxes as a freelancer, you have your tax forms that you can show as supporting document when you apply for a VISA or for loans. Your chances to get approved are higher, and you don’t have to worry about not ever having any proof of income. Remember though that you need to be a regular and consistent tax payer, meaning you have tax forms for every kind of tax that you need to pay and you never skipped filing / paying your taxes. To make it easier for you, you can check out https://www.taxumo.com to help you with your taxes.
Easily verify your PayPal account and will never encounter problems if your Business Documents are in place
PayPal is now strict when it comes to presenting proof of your existence. PayPal will require you now to present these “proofs”. This I think is a good move. This keeps all scammers away and protects all of us non-scammers! Here are the requirements from PayPal.
Proof of Identity: Present a valid proof of identity
PayPal accepts a copy of:
– Your national ID card (front and back),
– Your driving license (front and back),
– Your Passport, or
– Other photo ID that was issued by a government body
All of the information below must be visible on the document:
– First and last name
– Date of birth
– Date of issue and expiry
– Document ID number
Note: The document needs to be fully visible. Partial documents cannot be accepted as a valid proof of identity.
Proof of Business Address: Verify your business address by providing a valid proof of address
PayPal accepts a copy of:
– Utility bills (phone and broadband services, health insurance, gas, water, electricity, etc.)
– Bank or credit card statements
– Any other government-issued letters or statements in your name
You can take a photo of your document and upload it to your PayPal account. You can also send us a copy or a screenshot of your online bills/statements.
They do not accept:
– Purchase receipts/invoices
– Partial documents
– Screenshots of your online banking or service pages
The name and address on the documents must match those on your PayPal account.
The proof of address document must be dated within the last 6 months.
We cannot accept P.O. Box addresses as physical address verification.
Business Info: Verify your business entity by providing a proof of business documentation What is a valid proof of business?
Please submit a copy of your Business Registrations (Business registrations, Memorandum/Article of Association, Certificate of Incorporation or equivalent).
This document(s) must collectively contain the following information:
Who owns or controls your business,
The business name, registration number, and
The latest validity period of the business.
These are the things that you need to present. When you register with the Bureau of Internal Revenue in the Philippines as a Freelancer, you will have a Certificate of Registration or a COR. You will be able to submit this as proof of business. Once you have a COR though, you will need to regularly pay your taxes for your freelancing business.
Here is a quick video on how to sign up for a PayPal account:
Get bigger and higher paying Local Clients!
The thing about getting international or foreign clients is that there is a lot of competition. I’ve seen though that the local landscape is in dire need for more suppliers.
Local companies are now open to hiring independent contractors. In order to land a job with huge corporations or even just so you can haggle your pay, you need to be able to issue an official receipt.
Official receipts are documents that support sales of service, and it is issued upon collection of payment from customers. The large companies use official receipts as supporting documents for accounting entries that they create, and they also use it as “expense” when they compute for their own taxes.
So as a freelancer, this is what I do. I go through a supplier accreditation process. This process requires me to submit all of my business documents.
Then when I win a project, I send an invoice so that I can bill for services. Most local clients accept paperless invoices, such as a PayPal invoice. You can prepare your invoice conveniently using PayPal then you can send it through email. You can also use it as a reminder to collect payment and even send recurring payments to continuous projects.
After payment has been given, this is the time when you send the BIR Official Receipt.
Be a Responsible Filipino Citizen
Paying taxes is our duty as Filipino Citizens. If we truly want to help our country grow and prosper, we need to pay your taxes as a freelancer. Every day, we are experiencing things that we paid for with our taxes (drive through highways, take public transportation, etc.). If we want to see more improvement, we need to do our part and contribute by paying your taxes.
Also, if we want a voice, we need to earn that voice. I don’t think we have the right to complain if we’re not at least paying our taxes 🙂
Avoid being Penalized
In my opinion, this is the last and the least of your worries. If you are regularly paying then you need not worry about this. But for your information, yes, you can be imprisoned for tax evasion and non-filing of appropriate forms.
Failing to file and pay your taxes come with hefty penalties and can range from imprisonment for 2 to four years. Summed up, it can reach as high as up to five times than your original tax due. So, it would be better to pay your dues and avoid being penalized.
Personally, my freelancing business grew, because I’m legit and I pay taxes. Business partners, brands, and other people that I work with and plan to work with respect and trust me more, because I have a legit business. Having business documents will open you up to more opportunities and tools that you can use.
It’s always good to start your freelancing career the “legit” way, so you need not backtrack and fix stuff.
Work well and do it right! Pay your taxes as a freelancer!
I completely understand. We’ve been receiving thousands of inquiries via our chat button in Taxumo’s site this April asking a lot of things about the 8% Income Tax Rate option. So, I thought writing about it would be a good idea (and note that this is based on my understanding). Full disclosure! I am not a tax expert. I am just relaying what I have heard from our BIR contacts. And if you read opinions on this post, this is MY own personal opinions and not the opinion of Taxumo. Got it? 🙂
What is this 8% Income Tax Option and who can avail of this?
Because of the TRAIN Law (aka R.A. 10963), a lot of changes have been happening and a lot of people don’t know what to do. For sole proprietors, like yours truly, I just take in and digest parts of the TRAIN LAW that is applicable to me. One of the things that is an option now is the opportunity to avail of a simpler 8% Income Tax Rate Option.
The BIR released Revenue Regulation or RR 8-2018 which details how the income tax changes as per TRAIN will be applied. Although it explains a lot of things, there are still things that are not explained thoroughly. According to the regulation, the 8% Income Tax Rate on Gross Sales/Receipts can only be availed by any self-employed individual whose gross sales/receipts for the year does not exceed P3,000,000 (aka the VAT Threshold).
Check out this video from Taxumo:
So should I choose the 8% Income Tax Rate Option?
Choosing the 8% tax rate option is simple because it’s a flat rate! No hassle, no computations 🙂
But for me, I actually did not choose this. But I have my own reasons, and these are:
The Regulations said one thing but when I called my RDO, it seems they were not following what was on the RR. Case in point: RR No 08-2018 says: “If the taxpayer is unable to timely update the required registration, s/he shall continue to file the percentage tax return reflecting a zero amount of tax with a notation that s/he is availing of the 8% income tax rate option for the taxable year.” BUT, when I called my RDO, they said that for them (whatever that means), they don’t accept these forms filled out according to what the RR said.
So two (2), I personally called BIR and asked what the process is to opt for 8% and the gave me the process (as seen below) BUT I personally don’t have time to do that (hahaha! again, it’s just me and my laziness!)
And three (3), as an events coordinator, we have a lot of expenses. So, based on this calculator, I think the 3% plus income tax is still a better option for me.
So how do you tell the BIR that you’re opting for the 8% Income Tax Rate Option?
Step one: Go to your BIR RDO and bring your Certificate of Registration (COR) and a Letter of Intent. They will ask you if you haven’t gone beyond the threshold of Php 3 Million (They will also check your records and see if there are open cases, etc.)
Step two: Wait for them to release the new COR. It will not include “percentage tax” anymore. It will only show you that you need to pay for Income Tax and your yearly renewal. When do you get the new COR? Well, it really depends on how fast your Revenue District Office can release it.
It’s not that bad really and it’s very simple. I’m just lazy (haha!). After you receive your new COR, you can use Taxumo for filing taxes all throughout the year at just Php 250 per form. We just don’t have the rate yet for the 8% filing and the annual income tax filing, but we’re really affordable so you don’t have to worry about that part.
Please don’t forget to still file the first quarter Percentage Tax form for this year and just indicate zero filing. This is what the BIR Officers in different RDOs told me.
For opting in for the 8%, you need to update your COR before April 30, 2018.
What else did I miss?
Oh, for the Quarter 1 Income Tax Return filing due in May, don’t forget to indicate that you’re “opting in” to avail of the 8%. If you miss indicating this in the form, you will have to file your Income Tax Returns using the Graduated Income Tax Table AND also file quarterly percentage tax returns. I’m not sure if you need to change your COR back again to indicate that you’ll pay percentage tax though, but it’s most likely that you will.
So that’s it! These are the things that I know about the 8% Income Tax Rate Option.