Guide on How to Apply for Tax Exemption in the Philippines

Tax is the usual part of everyone’s adulthood life. Once you reach the age that you need to do your responsibilities, you’ll be aware that paying taxes is important. It is also a must to know what kind of tax you are paying and if there’s any tax exemption you’re entitled to because not everything you earn will be taxed.

If you wanted to know more about that exemption, this might help you.

Basically, tax exemption is a legal right of an individual or an organization to eliminate all or a percentage of their income from being taxed. If a person is eligible for tax exemption it means they will either pay lower taxes or no tax at all.

Who is Exempted from Paying Income Tax?

  • Minimum wage earners employees
  • Social Security System (SSS)
  • Government Service Insurance System (GSIS)
  • PhilHealth
  • Local Water Districts
  • Filipino immigrants who earns income outside the Philippines
  • Permanent resident of another country who earns income outside the Philippines
  • OFWs who earn income outside the Philippines (Land-Based or Sea-Based)
  • General professional partnerships
  • Corporations included in Section 30 of the Tax Code
  • Those who got income tax holidays such as BMBE, PEZA, BOI, etc
  • Building Association that was guaranteed by Home Guaranty Corporation
  • Loans associations that were guaranteed by Home Guaranty Corporation

Requirements Needed When Applying for Certificate of Tax Exemption from BIR:

  • Barangay Clearance
  • Certificate of No Property (from a city or municipal assessor’s office)
  • Affidavit of non-filing of ITR /no income / as OFW. It must be:
    -Source of income
    -Reason for non-filing of Income Tax Return
    -Purpose of certification
  • Overseas Employment Certificate from POEA (if you’re an OFW or children of OFW)

Steps on How to Apply:

  1. Prepare all the requirements needed
  2. Visit the Revenue District Office (RDO) in your location
  3. Go to the Taxpayer Service Section
  4. Submit all the requirements
  5. Proceed to cashier afterward and pay for the Php 100 fee plus the documentary stamp Php 15
  6. Wait for your certificate
  7. Receive your certificate

Being aware if you are eligible in tax exemption is a great advantage because you will be able to save money if there’s no tax that will be deducted on your earnings.

For more information you may contact BIR using this numbers:

Helpful Articles:
Guide on How to Pay BIR Tax Online

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