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Тема: Everything You Need to Know About BIR Form 2307

In the freelance world, BIR Form 2307 is a common sight.

It is one of the most important forms that a freelancer faces as they have to file it along with their Form 1701 or 1701Q.

One of the many reasons why this form is needed is that it facilitates tax calculations in the Philippines; however, its main function is to ensure and record tax liability.

You can learn more about BIR Form 2307 below:

Why should you file BIR Form 2307?

BIR Form 2307 is commonly referred to as a certificate of creditable withholding. This certificate shows income subject to extended withholding tax (EWT) paid by a withholding agent.

In accounting, the form is reported under assets. BIR Form 2307 is also considered an advance income tax payment because it is deducted from the taxpayer's income tax withholding on quarterly and annual income tax returns.

For the payee, the certificate of deductible tax withheld is important when preparing the income tax return, as it provides lawful proof of the tax withheld. Without this certificate, the taxpayer cannot claim their tax credit.

Please note that taxpayers should ask their employers to issue BIR Form 2307.

Who is required to file BIR Form 2307?

In most cases, freelancers are the ones who file the form. However, part-time freelancers and employers who hire project-based employees or freelancers must also file the form.

This form should be filed with the quarterly and annual income tax returns, also known as BIR Forms 1701/1701Q, for employees or BIR Form 1702/1702Q for businesses and corporations. Once filed, the withholding amount is recognized as a tax credit for the taxable quarter or tax year in which it was earned.

What do you need to include in the BIR Form 2307?

Completing the BIR Form 2307 is not as complicated as the other forms. However, you need to be aware that there are certain items that are subject to withholding tax, such as professional and talent fees, payments to beneficiaries, payments of government funds to vendors, and political contributions.

When do you need to file BIR Form 2307?

As mentioned earlier, BIR Form 2307 is usually filed with other forms. To help you figure out where else it is required, here are the forms the certificate is usually attached to, along with the date they must be filed.

For income tax returns, BIR Form 2307 is required when filing quarterly and annual individual and corporate income tax returns. The deadlines for quarterly income tax returns or BIR Form 1701Q are May 15, August and November. Annual income tax returns must be filed by April 15 of each year.

Extended Withholding Tax (EWT) must be issued on or before the 20th day of the month following the end of the taxable quarter. This must be submitted with the income payment at the request of the payee. The deadline for BIR Form 1702Q is on or before the 60th day after the end of each quarter of the taxable year and on or before April 15 after the end of the taxpayer's taxable year.

For percentage taxes on state cash payments, BIR Form 2307 must be issued in addition to BIR Form 2551. This must be issued within 25 days after the end of each taxable quarter.

For sales tax withholding or Forms 2550, BIR Form 2307 is required to be issued no later than the 20th day after the end of each taxable quarter.

Form 2307 Sample

Below is the copy for Form 2307 Sample. You can check it out.

Final Words

Unlike the other BIR forms, this form is relatively easy to understand, provided you know the many items for which withholding taxes must be withheld. Freelancers and those who hire freelancers or project-based employees need to know how to complete this form. It not only makes tax calculations in the Philippines easier, but also qualifies freelancers to claim their tax credits.