INCOME TAX – Guide on Annual Tax Until 2022 Based On Income

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Guide on Income Tax Rules From 2018 to 2022

INCOME TAX – Here is a guide on the annual tax implemented from 2018 to 2022 based on a person’s income.

Almost every citizen in the Philippines regardless of age, gender, and any other factors is paying taxes to the form. There are different ways on how a person is charged.

In every transaction or purchase you make at the grocery store, there is a tax. There are also taxes in booking tickets, dining in a restaurant, purchasing pieces of stuff in the department store, etc.

There are also several changes in the tax rules under the Tax Reform for Acceleration and Inclusion (TRAIN) Law or the Republic Act No. 10963. Income that goes beyond the exemption cap must pay taxes.

INCOME TAX

Based on the TRAIN Law Primer, the exemption cap for personal income tax is Php 250,000.00 a year. If your personal income is Php 250,000.00 or below, you won’t have to worry about deductions for the taxes.

For example, your monthly salary is Php 10,000.00 so your annual earnings is Php 120,000.00, you have nothing to worry about your taxes as you are exempted.

The national government started implementing the new income tax since 2018. Here is a guide on the tax rules until 2022:

  • 20% of the Excess Over P250,000.00
    • For example, you get Php 280,000.00 annually, your tax is 20% of the excess of your income from Php 250,000.00 so it is Php 6,000.00.
  • Over P400,000 but not over P800,000
    • P30,000 + 25% of the Excess over P400,000
    • For example, you get Php 450,000.00 annually, the excess is Php 50,000.00 and its 25% is Php 12,500.00. Your yearly tax is Php 30,000.00 + Php 12,500.00 = Php 42,500.00
  • Over P800,000 but not over P2,000,000
    • Php 130,000.00 and 30% of the excess over Php 800,000.00
    • For example, you get Php 820,000.00 a year. The excess is Php 20,000.00 and the 30% of it is Php 6,000.00. Your annual income tax is Php 136,000.00.
  • Over P2,000,000 but not over P8,000,000.00
    • Php 492,000.00 and 32% of the excess over P2,000,000
    • For example, you get Php 3 million in a year, the excess is Php 1 million thus 32% of it is Php 320,000.00. Your annual tax is Php 812,000.00.

Thank you for visiting our website. We hope we have helped you in regards to this. You may keep coming back for more informative guides.

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