How can employees claim their income tax refund? If you are an employee, you may notice that your employer is deducting and withholding a tax amount on your compensation income on a monthly basis. Your employer is just actually complying with the Bureau of Internal Revenue (BIR).
Employers as withholding agents
In the Philippines, employers are required by the National Internal Revenue Code to deduct and withhold income tax from the compensation of their employees with some exemptions (SEC. 79.A, NIRC, as amended), and then remit them to the BIR by filing the monthly BIR Form 1601-C (Monthly Remittance Return of Income Taxes Withheld on Compensation). At the end of the year and before January 31 following that year, employers also file the annual BIR Form 1604-CF (Annual Information Return of Income Tax Withheld on Compensation and Final Withholding Taxes) to report all the withholding taxes on compensation they have remitted to the BIR based on the BIR Form 1601-C they have filed for the entire calendar year.
In a simple explanation, here’s how it goes: employees earn salary or compensation income – compensation income is taxable and should be paid with the BIR. But instead of requiring the employees to file and pay their income tax directly to the BIR, employers are the ones who are deducting, collecting, withholding, and, remitting their income tax to the BIR. In other words, employers serve as withholding agents for the employees’ income tax dues to the BIR. This is also called substitute filing because the employers are the ones who are filing the BIR forms to the BIR instead of the employees.
Employers compute each of their employee’s income tax payable for the month using methods and withholding tax tables prescribed by the BIR. Those computed amounts are what they remit to the BIR.
The excess of tax withheld over tax due of the employee
Now, at the end or before the end of the calendar year prior to the payment of the last payroll, employers compute the total income tax due from the compensation of each employee for the entire taxable year. During the computation, differences may arise between the “tax due from the employee for the entire year” and the “sum of taxes the employer has withheld from January to November”.
Sometimes, the “tax withheld by an employer on the compensation of the employee from January to November” exceeds the “actual income tax due from the compensation of the employee for the calendar year”. This excess is to be refunded by the employer to the employee.
Reasons why tax refunds exist
Over withholding or remittances of employees’ income tax on compensation usually happens when errors in computations occur or when an employee adds a dependent child before the closing of the year causing this to increase the amount of his or her additional exemption, which also reduce his or her income tax due.
An example of this event is when an employee gives birth to a child just before the year ends and claims him or her as an additional dependent for the taxable year.
How to claim your income tax refund
Your tax refund will usually be computed by your employer on or before the end of the calendar year but prior to the payment of the compensation for the last payroll period to determine year-end adjustments. However, when an employee changes status, he or she should file with the employer a new or updated withholding exemption certificate reflecting the change within 10 days from such change (SEC. 79.D.2, NIRC, as amended). This is why when your status changes, you should notify your employer immediately to reflect the change. The withholding exemption certificate you file with your employer is used by him in the determination of the amount of taxes to be withheld.
Once it is determined that the tax withheld from the employee’s compensation has exceeded his or her tax due for the entire year or that he has an overpayment of income tax, the employer is required to give the tax refund to such employee not later than January 25 of the succeeding year (SEC. 79.H, NIRC, as amended).
Take note that employers who will fail or refuse to refund excess withholding tax to employees are liable to a penalty, as imposed by the NIRC (SEC. 252, NIRC, as amended).
Therefore, if it is determined that you have a refundable tax from your compensation, you will ask it from your employer.
However, you need to make sure that you will provide your employer with your accurate and most updated withholding exemption certificate. This is because if you fail or refuse to file the withholding exemption certificate or if you commit fraud by willfully supplying false or inaccurate information in it, you will not be refunded and it will be forfeited in favor of the Government (SEC. 80.B, NIRC, as amended).
Reference: National Internal Revenue Code, as amended, BIR Form 1601-C, BIR Form 1604-CF
Disclaimer: New and subsequent tax rulings, issuances and or laws in the future may render the whole or part of the article obsolete or inaccurate. This article was published for informational use only and is not provided to serve as legal, tax, or investment advice. Hence, we do not guarantee and is not liable for the accuracy or completeness of any information provided herein or in any outcome as a result for using this information.
Victorino Q. Abrugar is a marketing strategist and business consultant from Tacloban City, Philippines. Vic has been in the online marketing industry for more than 7 years, practicing problogging, web development, content marketing, SEO, social media marketing, and consulting.
I had my previous employer from january to may 2015 and i transfer may 2015 to my current employer. I submit my 2316 form and my current employer informed me that they will deduct 15,000 that i owed for my tax… How is this possible if my previous employer and my current employer is deducting the right amount of tax every cut off of my salary?
I’m previously employed last Jan to July 2014 to the (1st company) until now they are still processing my last pay, meaning I still do not have the 2316.
Now I’am employed from July 2014 up to present to (2nd company). The 2nd company declared thru 2316 a total of Php11,138.29 from July to Dec. 2014 but the actual deduction was Php42,247.06.
Questions:
1. Should my 1st company refund the Jan to July 2014 tax?
2. If I cannot give to my 2nd company the 2316 from previous employer, can the 2nd company refund the excess tax? how much should be the tax refund? 2015 is almost over, when should I receive the refund?
Please help.
I have resigned from my previous employer August 14th of this year. A week after, I started working on a different company. However, I was not able to secure an ITR and was not able to transfer RDO. My tax status now is “Zero”. Will I still be eligible for a tax refund?
would just like to us if it’s needed to transfer RDO to the RDO of your current company before they will release your tax refund?
sir our hire date was dec 19, 2014 and our company distributed our itr yesterday pero wala kmi nkuha kasi daw eksaktong 1year daw kmi ngstart. posible po ba un?
I had 2 employers for this year COMPANY A (Jan to May) and COMPANY B (JUNE to PRESENT), by Nov 30, 2015 – all employees who has multiple employer within the fiscal year needs to submit form 2316. I complied and passed this last Nov 27. 2015. I also submitted a birth cret of my daughter as well as our marriage cert so I will be on a ME1 status. Since I started last June I’m on a single status. Here’s my question, most of the employees received their tax refund but on my case, I need to pay for the tax refund “wherein they said that the remittance was not enough” – how could that be possible if obviously, they are the one who owes me on updating my status from single to ME1.
Hi question po. 5 months ako sa previous employer ko and no tax refund reflected sa backpay. And also, 2k+ lng ang tax withheld ko s 2316 but in my payslip nasa 10k n ang tax n nkkuha. Mkkuha ko pa b yun ky previous employer,thanks
Si current employer po kasi wla dn tax refund sken kht mlki ang kaltas ko every cut off dhil dw kulang si previous employer ko.
Hi
I resigned from my company in Oct 2015 which means hindi ko natapos ung buong taxable calendar year. Meron akong tax due which was deducted from my final pay. Tama ba yun? Or shouldn’t I be getting a tax refund instead?
Appreciate your advice.
Hi,
I wish to know how EMPLOYERS claim for taxes refunded to their EMPLOYEES to the BIR?
i have an inquiry guys.
i was employed on a company jan 2014 and process a resignation that will be active last dec 26 2014.
is there a tax refund from my last company that I can still process?
and im working right now in same area where my company was before.
same RDO
Hi. I have two employers within a year. I passed my BIR Form 2316 to my current employer as one of the requirements for the job offer. Then, they have deducted me a big amount of tax for the year 2015 because my previous employer has not yet submitted my tax from Jan-Aug. Is the amount that was deducted to me will be refunded by my previous employer?
Hi,
Can I get a tax refund to my current employer?and earned 19, 871.05 during that time I resigned on my previous company last July 2015. I’ll already received my back pay last November 2015 and my previous company gave my ITR 2316 dated January 2015 until July 2015. and I don’t know if my previous company included my tax refund. Now I am a minimum wage earner, did I entitled for tax refund on my current employer
I have a question regarding my Income Tax Refund last 2015 annualization. It was been computed in wrong manners. It was been base as Single – Zero Dependent while I filed with our HR Office the needed documents and fully filled up 2305 BIR forms for change of Tax Exempt Status from S0 to M4. Due to negligence of our HR office of not informing me as tax payer of my reject BIR Forms 2305 which was filed to them last October 12, 2015 and have been rejected by BIR 047 due to some old forms used needs in 3 sets informed by BIR to our HR office last October 14, 2015 but was not been relayed to me by our HR Office form possible re-submission. I was not able to avail the correct tax refund for me as M4- Married with 4 legal dependents. Can you kindly advise what possible charges can I put to my HR Office for that negligence they have done. And can I put a formal complaint to them regarding this.
Your reply/comment to this will be highly appreciated by me.
Is the refund still taxable? I just don’t get it! The company is returning the excess witholding tax they deducted from the previous months due to their irresponsible/wrong computation.. Na dapat nagagamit mo na ung pera every pay day na nagkakaltas sila na pinaghirapan mo regardless of the amount. Employers should held responsible for their careless computation, and should have given his employees pakunswelo de bobo, but still it is the employees who are suffering too much, because the refund is still taxable.. Others are happy receiving large amount of tax refunds, but come to think of it, imagine that large amount they deducted every month, is malaking kawalan every payday..
Ask ko lang po sa dati kong company (6 yrs) ung first ko me tax refund ako tapos nung mga sumunod na taon wala. Sa bago kong company (mag 3 years na) unang taon ko me nareceived akong tax refund tapos po kada december me kaltas ako sa tax eh nung sa dati kong company ala silang kaltas sa tax kada december. me ganito po bang kalakaran??
Hmm. as far as i know, nagkaka tax refund ka lang pag may exceed yung binabayad mo sa tax. For examplex ung employer mo binabawasan ka ng 2k pero month para sa tax mo pero pagdating ng one year sobra pala yung binabawas nila sayo keysa sa bayaran mo sa BIR kaya binabalik nila yun sayo every Jan. 25th of the year. Another example is, possible ka ng walang tax refund kung eksakto lang yung binabawas sayo. Last example, kung nag start ka ng work sa company mo ng March or onwards, inaassume ng company mo na binayaran mo yung isang taon mo kahit di ka naman nag simula mag work sa taong yun, kaya binabawas sayo ay sobra sobra, kaya pagdating ng tax refund schedule, yung january to february mo ay marerefund which is binayaran mo kaso di mo naman pinasukan. Sana na gets nyo ako. hehehe
What if I am working in a company but outside of it, I also am:
1. business owner
2. employer
Will there be a way that I can get a tax credit relief or a tax refund from the company I am working for? Sana masagot nyo tanong ko.
Regards,
Skipper
Hi just wanted to ask if I am also eligible for tax refund kasi yung accounting namin hindi makapagbigay ng computation ng tax dahil wala na daw silang copy. I am employed since April 6 2015 and wala kaming nakuhang tax refund until now. Pero yung ibang account sa office namin meron silang refund. Thanks. Please reply.
Is there such thing as a “perfect accounting”?
I have been employed in a BPO for almost 8 years and I never received an income tax return, even a single centavo.
I have worked for other companies, and yes, I received income tax returns. Not only during my employment but also when I receive my back pay.
Am i eligible for the tax refund from the Tax I paid last October to December? my company deducted tax in my salary that time and I am single with 3 dependent kids.
hello,
ask ko lang paano ako magrequest ng refund from my last year’s tax? hindi kasi nila niremit ung mga kinaltas sa sahod ko. same thing sa ibang government dues like sss, etc. can you help me create a request letter for this? and i would also like to ask the employer if i can get the records of all payments made, presign na din kasi ako sa company nila. thanks!
hi ,
i resigned from my previous call center company and i just want to know if i will get an income tax return .My employment for that last company was 5 months and i started a new job for another company. what will i do? Do i need to submit something? is it to my previous company or for this new one. sorry this is just my 2nd time working and im confused . hope you can help me. please reach me at baimejara.alamada @gmail.com
Hi! I’m on my first job and I started working last february. Am I supposed to receive my income tax refund? My workmates said I’m still single that’s why I didn’t receive any
ask cu larn po my nkpagsbe po kc skin na narerefund po pla ang tax … dba po aun un tin ?? tama po ba .. paiba iba po kc aq ng employer kc contractual larn po lagi ang work cu it means 5 months 5 months larn … lagi pong cashier ang work ko po for the past 5 years … and laat po un my deduction ng tin … pde po ba aq mgrefund ?? and how and when acu pde mgaply for the refund?? sana po mtulongan nio cu .. tnx a lot!
I am separated Last April 15, 2016. Makakakuha ba ako ng tax refund?
Hi Sir Victor, I just want to ask. Our employee resigned Last April and we gave him the refund this first week of June. Can we deduct the refund we made to our employee on our monthly compensation tax return for month of June and how to apply into 1601C form return?
Hi. I just wanna know if its true that if an employer is using annualization method,their employees are no longer entitled for the tax refund?
I have worked from feb9 to june27 then I resigned. How do I compute for my tax refund which should be included in my back pay? My status is Single without dependent.
If i started working in the company at feb 2016 & resigned at aug 2016 a total of 6 month is there still a tax refund that i can get still. My status is single with 2 dependents
Helo po.Hoping someone could help me on this.I had a child born last july 2014.I want to update my child as my dependent but then failed to do, so since,accordingly BIR won’t accept LCR birth cert.I tried to get the aunthenticated birth certificate but was notified that i’ll be able to get it a year after my child was born .Am i entitled to get a refund?
In my case ive been working in call center..single aq sa file pero the time i started i was already an S1 pero..12/01/2016 is my 2nd year ngaun lng aq magpapalit ng status from S to S1..will i get a refund?
Hello!
Is it legal to adjust basic pay per day from P581 to P481 and termed the difference of P100 as diminimis allowances?
hope to hear from you soon.
I am a private employee and I noticed that my withholding tax is higher even though I have a lower taxable earning compare to my co-workers who have a lower withholding tax but have a higher taxable earning. We have the same basic rate , I am quite suspicious why this happens. Is this reasonable? Do I just wait until the end of the year to see if I am entitled for a refund of tax?
Hi. Thank you very much for taking time in entertaining this query of mine. I was a contractual employee in an agency until I resigned effective June 20,2016. Our salary false on 5ths and 20ths of the month. And with 20th of June as my resignation, I am pretty sure that I did not received a tax refund on my last pay. On the same month of my resignation, I started in a new company having a 150% monthly gross salary compared from what I get from my previous employer.. Tax deductions were reasonable at first, until starting this Sept. 2016, the deduction doubled the amount of which should be withheld. I immediately ask our HR about this and was told that I was being “annualized”, in short will be charged for a year worth of tax. I was shock about it because I already submitted to them my 2316 from my previous employer. Please advise what actions should I take. If you have spare time, please email me.
hi… just want to know If I am entitled for a refund.
My employer failed to change my status (from married to married with 1dependent). I gave birth to my child last November 2010. and my status was only updated around March or April of 2015. am I entitled for a refund here?
Thanks,
Am I going to get my withholding tax I’ve started last April 2015 and I already left the company this November 2016 based on what I know they finalize the tax annually my total income from the start of this year was more then 500k and my tax status is s2 and the total tax that they’ve deducted was more then 125k.
Hi
I am single mother with qualified dependent children. I was filed my application for registration and declared my dependent since 2011 and forwarded to HR department, but unfortunately until now my status still single. Is there any possible that the company or BIR will refund my tax since 2011 until today? what should I do?
Hi,
I was employed from Jan 2016 to Apr 2016 then I received tax refund from prior employer. Then got hired again sometime July 2016, will I get tax refund? or will be taxed more before the end 2k16 of the year? Appreciate your response.
Thank you
Hi! I have this previous employer and kinakaltasan nila ko 10% ng sinusweldo ko every cut off. Pero wala silang maibigay na tin no. sakin. Nagresign ako sa kanila and I am asking if meron pa kong makukuha sa binayad kong tax kasi hindi naman nila ako kinuha ng tin # pero ang sabi nila regular employee lang daw ang entitled sa tax refund na ganon? totoo po ba yon?
I have a question, I have two employers for 2016. I filed for early retirement and I was with a new employer in July. Will I still have an income tax return if my salary with my present work is bigger than my salary at the former? I already submitted my form 2316 to my new employer, but I am still wondering if I will get a refund or will I have deductions. hope you can answer me..
Hello,
I have submitted the duly stamped 2305 to our HR last 2015 but they failed to change my tax status to our payroll. Because of this, our payroll is deducting me monthly, using the tax exemption basis of S2 instead of S3.
Our HR has just updated it last October 2016.
This means that I am paying excess tax from March 2015 to September 2016.
Will I still be able to get the excess tax I paid? It has been updated to BIR but not in our Payroll
Thanks
Hello, i started working aug2014 at Z status. After that year may refund ako pero naka ME ako instead na M1. I submitted all my docs pero wala akong refund na nakuha. This year naka ME pa din ako. I submitted all the required docs way back Sept2016, until now ME pa din nsa payslip ko. Isa lang employer ko. Qq is how can i be sure na ma process na this year?
Hi I left my previous job last may 19 2016 because I resigned. then I got a job around june 20, 2016. I don’t have a job for almost 1 month. And in my new job they asked me to submit 2316 from my previous employer. I did submit my 2316 later of october. But when I submit it, they charge me almost twice for my withholding tax. And most of all I didn’t get a tax refund. How is it computed?
Hi., I started working last Feb.2016 from employer A, I was terminated MAY 2016 for the absence without notice DAW. I was sick last MAY dahil sa maselan na pagbubuntis. Thank God, nakaraos and normal – gave birth last June 2016. Just this Sept.1, I started working again to employer B up to this day.
Our HR dept. ay di masipag on processing our documents for updates etc.,kaya ang TAX ko until now ay for SINGLE and NO DEPENDENT pa rin po.
1) How can I avail the tax refund?
2) How can I avail the refund if my previous employer refused to issue a tax certificate for the reason na terminated daw kasi ako?
3) If nanganak ako ng JUNE, and started working this Sept.,am I qualified na po ba agad for SINGLE WITH 1DEPENDENT Category? What month ako maqqualify?
thank you! Hope to get answers from you Sir/Maam.
Hope you could assist me.. i started to work last January 25 2016 in a bpo company and my status is single. will i get my tax refund for this year?
Hi,
I am a resigned employee in the philippines and now working in dubai. My last employer deducted me morethan 14k on my last pay. When i asked them what is the basis of this deduction.they just told me that it is due to salary increase that i have on that year. I resigned last june and have the salary increase on february.
Hello just want to ask if how to compute the Annual Income Tax, I believe that that is the one Withholding Tax to subtract to para makuha yung Excess Tax. As per my payslip stated for year 2016, I haved deducted almost 16000 na for my withholding tax with (ME) status. Please help me to compute my tax refund, here is my salary details:
Basic Salary = 15000 monthly
Married Status (ME)
SSS, PhilHealth, Pag-ibig deductions
Thanks, hoping your support for this.
Hi. I just wanna ask how does my employer deduct me P3,000 tax and sometimes P2500 on my salary every cut off in the past 3months, we are in semi monthly basis so it means they are deducting me more than P5000 every month. I’m really confused and frustrated bcos I only get P9000 to P11,000 gross income yet my tax is up to this amount. I don’t think that their computation is right. I also wanna know if this related to passing my BIR form 2316 from my previous employer but even such, I don’t think that their tax deduction to me is right, kahit na sabihin nilang hinahabol nila ung tax na ni-refund sa akin ng prev. employer ko because I just get P2,000 tax refund on my prev. employer bcos I was just with them up until Feb. 2016. I hope you can help me.
So bottom line is, tax refund is only given if the employers exceeds on the total deduction.???
Ibig sabihin it is not true na ibabalik lang ni company ang lahat ng total tax deduction mu since day one if HINDI MU NAKUMPLETO ANG 1 YEAR???
any clarification po?
Good evening. I just want ask if it is possible for a person (or an employee) to have deducted his salary for his tax eventhough you don’t have a TIN number for 4 years? What will be the actions to take about this? Thank you