8 Ways to Get New Quality Clients for Ph CPA Practitioners

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In this article, let me share my personal thoughts, if not experience, on some ways to get new quality clients for CPA practitioners in keeping with professional ethical standards. This may not be an all-inclusive list but hope you get something out of it that you can adopt for your own firm or practice.

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How to Record Foreign Currency Denominated Transactions in the Philippines?

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By: Charlyn Beric In the Philippines, most businesses compete not only locally, but also globally, where they have a great deal of potential and opportunity for expansion and growth. They usually engage in transactions such as buying or selling goods or services, as well as borrowing or lending money in foreign countries. So, when the company transacts in a foreign currency, how do you account for those transactions as an accountant, and what are the tax implications?  What is foreign currency transaction? Foreign currency transactions occur when a company’s transactions are denominated in a currency other than the primary currency, also known as functional currency. Philippines Accounting Standards 21 The Effects of Changes in Foreign Exchange Rates defines functional currency as the currency of the primary economic environment in which the entity operates and reports its financial statements in one currency. Presentation currency on the other hand is the currency

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Why Should You Withhold Taxes on Payments to Digital Freelancers in the Philippines?

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Revenue Regulation 11-2018 specifically states that “Persons engaged in the sale of computer services, computer programmers, software/program developer/designer, internet service providers, web page designing, computer data processing, conversion or base services and other computer related activities” are categorized as Other Contractors and payments made to them should be withheld with 2%.

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Business Registration and Compliance: The Philippine Digital Freelancer’s Milestone to a Long-term Business

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By: Cecile Maglunob-Pagaspas, CPA Freelancing business is the latest trend especially for digital professionals. The unique setting of this career is indeed promising especially for those who enjoy working for their passion at their own pace.  It is however commonly observed that many digital freelancers in the Philippines hide their business or let go the good opportunities due to fear of being caught by the tax authorities while operating without legal documents. Getting Legitimate Many digital freelancers are starting their work through an informal contract with clients. This is totally fine especially on the initial stage of the venture. Staying on the same career path in the long run however will require a complete paper to show one’s business legitimacy. In getting legit, digital freelancers can either register in the Department Trade of Industry (DTI) as Sole Proprietor or Securities and Exchange Commission (SEC) as a corporation. For digital freelancers

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Revenue Regulations No. 09-1998

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This revenue regulation prescribes to implement RA No. 8924 relative to the imposition of the Minimum Corporate Income Tax (MCIT) on domestic corporations and resident foreign corporations. Specifically, an MCIT of 2% of the gross income as of the end of the taxable year is imposed upon any domestic corporation commenced its business operations. The MCIT will be imposed whenever such operation has zero or negative taxable income or whenever the amount of MCIT is greater than the normal income tax due from such operation. In case of a domestic corporation whose operation or activities are partly covered by the regular income tax system and partly covered under a special income tax system, the MCIT will apply on operations covered by the regular income tax system. The Regulations will apply to domestic and resident foreign corporation on their aforementioned taxable income derived beginning January 1, 1998 pursuant to the pertinent

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Tax Incentives of existing PEZA, BOI, etc. entities under RA 11534 CREATE Philippines

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By: Garry Pagaspas, CPA As we are all aware, Republic Act No. 11534 (RA 11534) or Corporate Recovery and Tax Incentives for Enterprises (CREATE) in Philippines has been signed into law last March 26, 2021 with Vetoed Provisions and became effective last April 11, 2021. One notable aspect of RA 11534 CREATE Philippines is the rationalization of incentives thereby harmonizing the available tax incentives that Investment Promotion Agencies could grant (e.g. income tax holiday (ITH), enhanced deductions (ED), and 5% special corporate income tax (SCIT) among others), creating a new set of standards for those who can avail in certain locations throughout the Philippines. Under this, the question is how would RA 11534 CREATE Philippines affect the tax incentives of existing registered business enterprises (RBE) with the fourteen (14) Investment Promotion Agencies (IPA) such as Philippine Economic Zones Authority (PEZA) and Board of Investments (BOI)? To address the above question,

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Vetoed Provisions of RA 11534 CREATE

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March 26, 2021 THE HONORABLE SPEAKER AND  THE LADIES AND GENTLEMEN OF  THE HOUSE OF REPRESENTATIVES In accordance with my firm commitment to uplift the lives of the Filipino people and pave the path for economic recovery and inclusive growth, I sign into law Republic Act (RA) No. 11534, entitled “ AN ACT REFORMING THE CORPORATE INCOME TAX AND INCENTIVES SYSTEM, AMENDING FOR THE PURPOSE SECTIONS 20, 22, 25, 27, 28, 29, 34, 40 57, 109, 116, 204 QND 290 OF THE NATIONAL INTERNAL REVENUE CODE OF 1997, AS AMENDED, AND CREATING THEREIN NEW TITLE XIII, AND FOR OTHER PURPOSES,” or the “ Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act”. I.GENERAL COMMENTS After more than twenty years of deliberations on the countless versions filed in Congress, corporate income tax reform and fiscal incentives rationalization has finally come to fruition. It comes at an opportune time, since it will

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RMC No. 29-2021: Adoption of e-Signature on Certain BIR Forms

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By: Hergie Anne C. De Guzman, CPA The Bureau of Internal Revenue (BIR) issued Revenue Memorandum Circular (RMC) No. 29-2021 for the adoption of the electronic signatures (e-Signatures) in the following BIR Forms or Certificates: BIR Form 2304 or Certificate of Income Payment Not Subject to Withholding Tax (Excluding Compensation Income) BIR Form 2306 or Certificate of Final Tax Withheld at Source BIR Form 2307 or Certificate of Creditable Tax Withheld at Source  BIR Form 2316 or Certificate of Compensation Payment / Tax Withheld For Compensation Payment With or Without Tax Withheld BIR was already eyeing on this adoption since the issuance of RMC No. 121-2019 which prescribes the use of certain BIR Forms/Certificate in electronic format. E-signature is defined in Section 5 of Republic Act No. 8792 or the Electronic Commerce Law of 2000 as any distinctive mark, characteristic and/or sound in electronic form, representing the identity of a

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PH SEC GOES ONLINE ON FINANCIAL STATEMENTS & OTHER REPORT SUBMISSIONS

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By: Seala Marie Asis, CPA The SEC released on February 19, 2020 the update of the newly developed Online Submission Tool (OST) to be used for filing of financial statements and reports in digital format to automate business transactions and promote sustainable business practices.  This online platform will be rolled out in this year’s filing season where corporations  can file their AFS, GIS, Sworn Statement for Foundation (SSF), General Form for Financial Statements (GFFS), and Special Form for Financial Statements (SFFS). Accordingly, the OST will accept on its initial implementation stage the submission of Affidavit of Non-Operatin (ANO), together with their GIS or AFS, and affidavit of Non-Holding of Annual Meeting (ANHAM), together with the GIS. This online platform operationalizes Section 180 of the Revised Corporation Code mandating the SEC to develop and implement an electronic filing and monitoring system and in consistency with the RA 11032 requiring government agencies

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Ph BI now allows entry of certain Foreign Nationals, Expatriates, and Visa Holders starting Feb. 1, 2021

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Relative to the Resolution No. 97 Series of 2021 issued by the Inter-Agency Task Force for the Management of Emerging Infectious Diseases (IATF-MEID), the Philippine Bureau of Immigration (BI) has issued a revised guideline last January 30, 2021 effective starting February 01, 2021. The Ph BI Revised Travel Restriction Guidelines, among others, updated and lifted the travel restrictions imposed on those coming from 36 countries on Covid-19 new variant threat, and starting February 01, 2021, allowed entry of certain foreign nationals, expatriates, and Philippines visa holders.

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