As Freelancers, we can all relate to the fact that time is money. Instead of using the time to work on transactions, if we can do it online to save time and produce income, why not? So if we are paying tax to BIR, we must take advantage of doing it on our mobile phone.
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Here, I document my experience to be of benefit for other fellow workers. First part is the BIR fill-out process, the second part is the GCash process. You can skip the first part if you already know it.
I am a Freelancer for 7 years now (Oct 2016), and I would consider myself self-employed. If you are a freelancer or considering to be one, here are some tips I made based from my experience.
If you are a business owner, it is better to give additional value for your company by giving your employees Life Income Protection. Through this, they will have more reasons to stay and be glad being with you. As a Licensed Financial Advisor under Sun Life Philippines, we can set an communicate and set an appointment, and I can help you provide this benefit. You can get a life insurance with investment that will help secure future income for your dependents and grow your wealth for the uncertain future.
I see that Philippine Freelancers have no strict policies yet from our government but I think it would be beneficial and profitable if we can secure some government authentication.
So after securing DTI, BIR permits, Mayor’s Permit and other documents, I think these are the advantages
- You can use your Income Tax Return someday for some emergency loans or business expansion loans.
- You can issue receipt to clients or companies who need it.
- You can leverage the growth to turn your freelance business to a corporate business someday.
And one of the monthly responsibilities by having a BIR permit is taxes. As a self-employed freelancer, we are solopreneurs most of the time. We normally don’t have accounting department and messengers so we work it out by ourselves.
When I was still renting, I pay two kinds of taxes every month:
1. Withholding Tax – 5% of my total rental – this is supposed to be deducted to your payment to your landlord. The form I fill up is 1601-E.
2. Monthly Percentage Tax – 3% of your monthly income (if Non-VAT) since I am a Non-Vat. The form I fill up is 2551M.
If a freelancer is working at home, no need to pay Witholding Tax/ 1601E. You may be required to submit an Affidavit of Non-Rental which states that you are in a home or office where you don’t pay any rent.
I use this BIR Forms Software which can be downloaded from the BIR site. Fill-out basic information, TIN number and select the type of form. It will then give the specific form, fill out the amounts and submit. It will be emailed to the BIR servers and a copy of confirmation will be sent to your designated company email.
Visit the nearest Globe center. Buy a GCash card (P150) and connect it to your mobile number. In my case, my Android is dual sim, so I can have the best of both worlds. I’m not sure if Smart has this offer and I don’t why if they don’t.
The Gcash Rep should confirm that your card is now connected to your mobile phone number.
Download the Gcash App. In my experience, I can’t usually connect to GCash if I use WiFi. I have to switch to Mobile Data under the Globe Signal. This way, I can access GCash App.
When you are in the App, it would be easy and self-explanatory. Head to Pay Bills, select BIR and fill-in important information.
- First you must secure loan for your GCash account via Globe Prepaid load or Bank connection.
- Select Government or Search BIR among the list of merchants.
- Select BIR
- Enter TIN Number, and the type of Form Series and Form Number.
- Remember to pay taxes before the deadline to avoid having penalties.
I went to BIR beforehand to confirm this and they acknowledged such process. Just keep a snapshot of your payments or you can request a copy of your transaction history inside the GCash App itself.
Tags: Philippines, Internal Revenue, Freelancer, Self-employed