Unlock Tax Savings Potential with Expert Tax Compliance 

Are you keen on maximizing your tax savings? Seeking guidance on how to achieve it from a professional tax planning and accounting expert is the best solution. If you aim to optimize your financial systems and retain a larger portion of your profits, a comprehensive review of your tax planning strategy is essential. The BIR’s vigorous efforts to enhance tax collections make it imperative to adopt the right approach to tax planning. Enlisting the assistance of tax compliance service providers in the Philippines can be a game-changer. 

 

Doing so is a strategic move for any business looking to maximize tax savings and ensure full compliance with tax laws. Their expertise, proactive approach, and commitment to your financial success make them indispensable partners in your journey towards greater profitability and sustainable growth. So, take the step towards optimizing your tax planning today and unlock the full potential of your business’s financial future. Here’s what they can help you with.

Maximize Eligible Tax Deductions

To claim tax deductions, it’s crucial to have proper documentation, including official receipts and sales invoices. Certain expenses like bad debts require a board resolution, and casualty losses need notification from the BIR for validation. Expenses subject to withholding tax must have the correct tax withheld; otherwise, they won’t be eligible for deduction.


If itemized deductions are preferred, consider utilizing the NOLCO (Net Operating Loss Carry-Over). Properly stating previous financial statements and income tax returns allows you to claim NOLCO on a first-in, first-out basis within three years from the year of the loss. Experts can help you keep track of these essentials.

Leverage Tax Credits

Tax credits in the form of creditable withholding tax certificates serve as evidence of your advance tax payments, which are deductible from your annual income taxes. Experts can ensure these certificates are properly secured from your customers and supported by the BIR Form 2307 or the withholding tax certificate.

 

Another option is the minimum corporate income tax from previous years, which can be credited against the normal income tax due, similar to NOLCO. This credit can be claimed within three years.

Identify Qualified Donees

Contributions made to accredited donee institutions may be fully deductible under specific conditions only. To claim charitable contributions as deductions, compliance professionals can help you submit BIR Form 2322 or a certificate of donation, containing the donee certificate and the donor’s values statement. Meeting the criteria may exempt you from the donor’s tax.

Choosing Between Optional Standard Deduction and Itemized Deduction

The Optional Standard Deduction (OSD) allows deductions of up to 40% of your gross income. Opt for OSD if you have lower costs of sales or service, as it uses a higher tax base for computation, resulting in a lower income tax due. You also don’t have to keep track of all items as with itemized deduction. Note that the chosen deduction method will be irrevocable for the same taxable year, so make an informed decision. An accounting expert can help you decide which option is the most suitable for your business. 

Handling Excess Income Tax Payments

Dealing with excess income tax payments involves a choice between carrying over the excess credit to the next taxable year or applying for a refund of the excess tax paid. If opting for a refund, consider the cost, amount, and expected time frame. Be cautious as a refund application may lead to an audit investigation. But with an accounting expert guiding you, you have nothing to worry about.

Avoiding Taxation on Non-Taxable Items

Ensure that non-taxable items, such as unrealized foreign exchange gains, are not subject to taxation. Professionals emphasize that it is crucial to understand how your items are treated concerning income in your gross sales/receipts to avoid any inadvertent taxation.

Monitoring Retained Earnings

Maintaining a close watch on unappropriated retained earnings linked to your paid-up capitalization is crucial to avoid penalties. Failure to manage accumulations correctly may result in a 10% penalty. Avoid these issues with expert help.

Availing Tax Treaty Relief

For transactions involving tax treaty country residents, consider seeking tax treaty relief. Transactions covered by a tax treaty may qualify for tax exemption or preferential tax rates. File a Tax Treaty Relief Application (TTRA) to confirm eligibility for relief and prevent potential issues with the BIR.

 

Engaging with tax compliance service providers can significantly enhance your ability to capitalize on tax savings and achieve optimal tax planning. By following the right strategies, you can safeguard your business’s financial health and enjoy a competitive edge in the market. Remember, professionals bring a wealth of expertise and knowledge that prove invaluable in navigating the complex and ever-changing landscape of PH tax regulations. They stay up-to-date with the latest tax laws, guidelines, and incentives, ensuring that your business takes full advantage of every available opportunity for tax savings.

 

Beyond tax planning and compliance, experts also offer valuable insights into other financial aspects of your business. They can assist in structuring transactions in a tax-efficient manner, provide guidance on managing foreign income and investments, and help you navigate complex tax treaty arrangements. Sounds overwhelming? Call us! Collaborating with our team can also grant you peace of mind, knowing that your tax affairs are in capable hands. This allows you to focus on your core business operations and strategic growth initiatives without being burdened by the complexities of tax compliance.

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