Bir Wants Online Sellers To Pay Taxes

[Jollygoodfellow]

I wonder how that affects people like expat blog owners who sell Ebooks while living in the Philippines. And then the poor guy who has a second hand ref to sell? 

 

 

BIR wants online sellers to pay taxes

 

 

MANILA, Philippines - The Bureau of Internal Revenue (BIR) said it will start collecting taxes from individuals and businesses selling products online as part of its aggressive efforts to meet collection goal and boost government revenues.

 

The BIR issued a new memorandum which reiterates online sellers’ obligation to pay taxes.

 

Citing the National Internal Revenue Code, Internal Revenue commissioner Kim Henares said failure of online sellers to register with the BIR would result in the imposition of appropriate penalties.

 

Henares said the law requires the issuance of receipts by online sellers for every sale of goods and properties or exchange of service. The receipt must bear the full amount of the sale to the buyer.

 

Under the rules, online sellers must secure the required Authority to Print (ATP) invoices and register books of accounts for use in business either manually or electronically.

 

The receipt, the BIR said, must be prepared at least in duplicate, the original to be given to the buyer and the duplicate to be retained by the seller as part of the latter’s accounting records.

 

Online sellers are also required to file and pay applicable tax returns on or before the due dates as well as submit a summary list of sales/purchases including the payees.

 

Henares said the existing tax laws and revenue issuances on the tax treatment of purchases (local or international) of goods (tangible or not) shall apply to all transactions wherein consumers directly buy goods or services from a seller and an intermediary or third party over the Internet. Therefore, those using online social networks such as Facebook must register as a taxpayer.

 

Among the popular online buy and sell websites include sulit.com.ph, ayosdito.ph, alibaba.com, and tsikot.com, etc.

 

Also covered by the rules are those that use the Internet to deliver marketing messages to attract potential buyers and those that conduct online auctions (such as ebay.ph).

 

Aside from issuing official receipts, online merchants or retailers are mandated to issue acknowledgement receipt to the credit card company or payment gateways for the amount received. They must also pay the commission of credit card company net of 10 percent expanded withholding tax.

 

Payment gateways which refer to banks, credit card companies, financial institutions and bill paying services are similarly required to issue validated bank deposit slips in the name of the merchant or intermediary and remit the amount to the merchant less EWT of one half of one percent.

 

Freight forwarders and online website administrators are likewise required to issue the BIR registered OR for the service fees paid by the merchant or advertisers.

 

According to the BIR, the merchant/retailer is obliged to pay the online advertising entity for the advertising fee, net of two percent EWT.

 

http://www.abs-cbnnews.com/business/08/24/13/bir-wants-online-sellers-pay-taxes

[Dave Hounddriver]

Its one of those things where a little bit is personal and a lot is business.  Examples:

 

Family member looks after the kids:  Do you pay minimum wage and all deductions?

You sell you house or car on line:  Do you pay the BIR taxes?

You loan money to a relative:  Do you collect tax and declare yourself a money lender?

 

I suggest this is going to come down to common sense and a high priced lawyer if anyone gets caught in this net.

[Tukaram (Tim)]

It sounds like an enforcement nightmare.  Also sounds like it is going to hurt the auction sites and places like sulit.  Make it difficult and people won't use the sites anymore.

[i am bob]

 I looked into this a while back...  Ok, last year and again about 2 months ago.  I have books listed under a pseudonym available at Amazon as well as Indigo and BN so I had to make sure before I come that I won't have to worry about it.  And, as almost everything published is sold either through an American bookseller (where taxes are paid to the US) or a Canadian site (Canadian taxes), I thought I didn't have to worry about it.  Unfortunately, some of these I have been selling myself online.  But guess what?  Since I pay tax to Canada for them, I am exempt to worrying about this with the Philippines.  If I denounce my Canadian citizenship and become strictly a citizen of the Philippines, I will then have to register and pay taxes in the Philippines.  Makes sense.  Here comes the kicker...  They haven't given me a straight answer towards a situation if I become a dual Canadian - Philippines citizen.  

[Thomas]

BIR wants online sellers to pay taxes

Well. No big difference concerning who are suppoused to PAY tax*

the main difference is BIR will CHECK more  :)

 

Bad for administration and USELESS for adding control possibility having to make duplicate reciepts  :(  Common smaller systems now DO make reciepts to the buyer already, but the owner just get lists SHOWING transactions and they are even BETTER for BIR to use for checking, so demanding duplicates is WASTE work  :bash:   companies having to do more work manualy or rebuild the common systems, which are used in OTHER countries, so them in other countries will surely NOT bother to rebuild the often used systems...

 

*The rule has been already no tax at earnings by work done OUTSIDE PHL,

but I suppouse some have cheated  :) having the business "stationed" abroad, but handling it from PHL, but haven't told that to BIR.

 

I don't know if it will be any tax difference for auctions and ad sites as e g sulit, but if the tax rule is as in Sweden, then it's tax only when get PROFIT compared to what the product was bought for, and most was BOUGHT NEW and SOLD USED, so almost all LOSE when selling in such websites... If the rule is like that, then will checking such websites don't give much tax  :)