First of all, if you're still unsure whether you'll really save money using the 8% Income Tax Rate, check out this article: TRAIN's New 8% Tax -- Does it really save you money? In this article, we also provide a calculator that helps you determine whether opting in for it will save you money.

Now, in determining what changes need to happen once you have decided already, please read this article: How to Avail of the 8% Income Tax Rate on Gross Sales/Receipts

Within Taxumo, if you've finally decided to go with the 8% Income Tax Rate on Gross Sales/Receipts, you choose the appropriate ATC in your company profile:

II012 - Business Income - Graduated IT Rates
II013 - Mixed Income - Graduated IT Rates
II014 - Income from Profession - Graduated IT Rates

II015 - Business Income - 8% IT Rate
II016 - Mixed Income - 8% IT Rate
II017 - Income from Profession - 8% IT Rate

IMPORTANT NOTE:

  • If you are choosing to opt in to 8%, then we advise that you also go to your RDO, file a 1905, and indicate your opt in that way. We acknowledge that this is not what is written in the RR 08-2018 but we believe that this is the surer way to make sure your opt in is acknowledged by your RDO. If your RDO says it's too late to opt in or you are not allowed to opt in, then you will have to choose an ATC that corresponds to the Graduated Income Tax (IT) Rate.
  • If you choose II015, II016, or II017 to file a 2551Q, Taxumo will file a 0 (zero) due Quarterly Percentage Tax Form. This is as per advise of BIR client services and the RDO's we called - with the purpose of making sure you don't have any open case. You can then opt in to the 8% Flat Income Tax Rate during your 1701Q filing due on May.

Do note that which forms appear and what forms you file WILL depend on whether you were able to correctly answer this field. If you are at all unsure, choose an ATC that corresponds to the Graduated IT Rate (II012, II013, or II014).

If you have any other questions, just send us a note via the chat button!

Did this answer your question?