Rental Property Income

[OnMyWay]

59 minutes ago, fillipino_wannabe said:

If the rent is less than 15k per month then it's VAT exempt, higher then you'll need to add VAT to the price. 

I don't that is correct.  VAT is not applied for business' under p3 mil.  You would need a lot of units to reach that much, or one unit renting for p250,000 per month.  The threshold used to be p1,900,000 until last year and was changed as part of TRAIN.

https://www.bir.gov.ph/index.php/tax-information/value-added-tax.html

Who are Required to File VAT Returns?

Any person or entity who, in the course of his trade or business, sells, barters, exchanges, leases goods or properties and renders services subject to VAT, if the aggregate amount of actual gross sales or receipts exceed Three Million Pesos (Php3,000,000.00)

A person required to register as VAT taxpayer but failed to register

Any person, whether or not made in the course of his trade or business, who imports goods

[hk blues]

2 minutes ago, jimeve said:

Rental Income Tax Philippines | Rental Property Taxes Philippines

Yes.

So why doesn't your wife set herself up as a business and she can perhaps avoid the tax on the first 250K?  That said, is it worth it?  I had no choice as my local BIR insisted I had to go down that route.

[OnMyWay]

8 minutes ago, jimeve said:

Rental Income Tax Philippines | Rental Property Taxes Philippines

That is all oriented towards non-residents and their information is outdated as well.  Use caution!

Non-residents are taxed differently.

[jimeve]

45 minutes ago, hk blues said:

Yes.

So why doesn't your wife set herself up as a business and she can perhaps avoid the tax on the first 250K?  That said, is it worth it?  I had no choice as my local BIR insisted I had to go down that route.

She has got a rental business, she had to have one.   

[jimeve]

45 minutes ago, OnMyWay said:

That is all oriented towards non-residents and their information is outdated as well.  Use caution!

Non-residents are taxed differently.

Financial Information for Residential Property Buyers. from the same page at the top. The one at the bottom of the page is for non-residence.

[hk blues]

13 minutes ago, jimeve said:

She has got a rental business, she had to have one.   

Why is she paying tax on income below 250K then? 

[jimeve]

5 minutes ago, hk blues said:

Why is she paying tax on income below 250K then? 

No Idea! Just been looking at the BIR and I can see the 250,000 mark.

Can't figure it out, unless rental income comes in a different division! 

 

Edited February 1, 2019 by jimeve

[hk blues]

2 minutes ago, jimeve said:

No Idea! Just been looking at the BIR and I can see the 250,000 mark.

 

By coincidence I just did my annual return this morning  - 60% of income is taxable and then 250K deducted and then 20% (in my case) of balance.  I file my return online so all of the above is automatic - just plug in the income and hey presto, the tax is calculated! 

[jimeve]

1 minute ago, hk blues said:

By coincidence I just did my annual return this morning  - 60% of income is taxable and then 250K deducted and then 20% (in my case) of balance.  I file my return online so all of the above is automatic - just plug in the income and hey presto, the tax is calculated! 

It's our first year, did ours 3 weeks ago. We did a lot of Jumping through hoops. For such a small return it's not worth it.

[hk blues]

Just now, jimeve said:

It's our first year, did ours 3 weeks ago. We did a lot of Jumping through hoops. For such a small return it's not worth it.

The form was updated a few days ago and is much simpler now - only 2 pages.  

What system is your wife using  - the tax tables or the 8%?  Does your wife also pay the 3% percentage tax quarterly?