Percentage tax is a business tax imposed on persons or entities who sell or lease goods, properties or services in the course of trade or business whose gross annual sales and/or receipts do not exceed P750,000 and who are not VAT-registered.

·          Any person who is not a VAT-registered person (persons exempt from VAT under Sec. 109z of the Tax Code)

·          Domestic carriers and keepers of garages, except owners of bancas and owners of animal drawn two- wheeled vehicle

·          Operators of international air and shipping carriers doing business in the Philippines

·          Franchise grantees of electric, gas or water utilities

·          Franchise grantees of radio and/or television broadcasting companies whose gross annual receipts for the preceding year do not exceed Ten Million Pesos (P 10,000,000.00) and did not opt to register as VAT taxpayers

·          Operators of communication equipment sending overseas dispatch, messages, or conversations from the Philippines, except on services involving the following:

o         Government of the Philippines - for messages transmitted by the Government of the Republic of the Philippines or any of its political subdivisions and instrumentalities

o         Diplomatic services - for messages transmitted by any embassy and consular offices of a foreign government

o         International organizations - for messages transmitted by a public international organization or any of its agencies based in the Philippines enjoying privileges, exemptions and immunities which the government of the Philippine is committed to recognize pursuant to an international agreement

o         News Services - for messages from any newspaper, press association, radio or television newspaper broadcasting agency, or newsticker services to any other newspaper, press association, radio or television, newspaper,  broadcasting agency or newsticker services, or to bonafide correspondents, which messages deal exclusively with the collection of news items for, or the dissemination of news items through public press, radio or television broadcasting or a newsticker service furnishing a general news service similar to that of the public press

·          Banks and non-bank financial intermediaries and finance companies

·          Life insurance premiums

·          Agents of foreign insurance companies

·          Proprietor, lessee, or operator of cockpits, cabarets, night or day clubs, boxing exhibitions, professional basketball games, jai-alai and race tracks

·          Every stock broker who effected a sale, barter, exchange or other disposition of shares of stock listed and traded through the Local Stock Exchange (LSE) other than the sale by a dealer in securities

·          Corporate issuer / stock broker, whether domestic of foreign, engaged in the sale, barter, exchange or other disposition through Initial Public Offering (IPO) seller in secondary public offering of shares of stock in closely held corporations

Tax Form
BIR Form 2551 M - Monthly Percentage Tax Return

Documentary Requirements

1.       Duly issued Certificate of Creditable Tax Withheld at Source (BIR Form 2307), if applicable

2.       Duly approved Tax Debit Memo, if applicable

3.       Copy of Certificate of Registration issued by Cooperative Development Authority for cooperatives and from the National Electrification Administration for electric cooperatives

4.       Previously filed return and proof of payment, for amended return

Procedures
1.  Fill-up BIR Form 2551 M in triplicate copies

2.       If there is payment:

·         Proceed to the nearest Authorized Agent Bank (AAB) of the Revenue District Office where taxpayer is required to register and present the duly accomplished BIR Form 2551 M, together with the required attachments and payment. (The Percentage Tax imposed shall be paid at the time the return is filed by the taxpayer.)

·         In places where there are no AABs, the duly accomplished BIR Form 2551 M, together with the required attachments and payment, shall be filed/paid with the Revenue Collection Officer or duly Authorized Treasurer of the city or municipality where said business or principal place of business is located.

·         Receive taxpayer's copy of the duly stamped and validated form from the teller of the AAB/Revenue Collection Officer/duly Authorized City or Municipal Treasurer.

3.       If there is no payment:

·         Proceed to the Revenue District Office where taxpayer is required to register and present the duly accomplished BIR Form 2551M, together with the required attachments.

·         Receive taxpayer's copy of the duly stamped and validated form from the RDO representative.

Note: "No payment" returns filed late shall be imposed the necessary penalties by the RDO, which shall be paid at the concerned AAB.

Deadline

·         Manual Filing

Not later than 20th day following the end of each month

·         Filing Through Electronic Filing and Payment System (eFPS)

Group A - Twenty-Five (25) days following the end of the month
Group B - Twenty-Four (24) days following the end of the month
Group C - Twenty-Three (23) days following the end of the month
Group D - Twenty-Two (22) days following the end of the month
Group E - Twenty-One (21) days following the end of the month

Tax Form
BIR Form 2551 Q - Quarterly Percentage Tax Return

Documentary Requirements

1.       Duly issued Certificate of Creditable Tax Withheld at Source (BIR Form 2307), if applicable

2.       Duly approved Tax Debit Memo, if applicable

3.       Copy of Certificate of Registration issued by Cooperative Development Authority for cooperatives and from the National Electrification Administration for electric cooperatives

4.       Previously filed return and proof of payment, for amended return

Procedures

1.       Fill-up BIR Form 2551 Q in triplicate copies.

2.       If there is payment:

·          Proceed to the nearest Authorized Agent Bank (AAB) of the Revenue District Office where taxpayer is required to register and present the duly accomplished BIR Form 2551Q, together with the required attachments and payment. (The Percentage Tax imposed shall be paid at the time the return is filed by the taxpayer.)

·          In places where there are no AABs, the accomplished BIR Form 2551 Q, together with the required attachments and payment, shall be filed/paid with the Revenue Collection Officer or duly Authorized Treasurer of the city or municipality where said business or principal place of business is located.

·          Receive taxpayer's copy of the duly stamped and validated form from the teller of the AAB/Revenue Collection Officer/duly Authorized City or Municipal Treasurer.

3.       If there is no payment:

•       Proceed to the Revenue District Office where taxpayer is required to register and present the duly accomplished BIR Form 2551Q, together with the required attachments.
  
•       Receive taxpayer's copy of the duly stamped and validated form from the RDO representative.
  Note: "No payment" returns filed late shall be imposed the necessary penalties by the RDO, which shall be paid at the concerned AAB.

Deadline

·          Manual Filing

            Not later than 20th day following the end of each quarter

·          Filing Through Electronic Filing and Payment System (eFPS)

      Not later than the 20th day following the end of the quarter

Tax Form

BIR Form 2552 - Percentage Tax Return (For Transactions Involving Shares of Stocks Listed and Traded Through the Local Stock Exchange or Through Initial and/or Secondary Offering)

Documentary Requirements

1.       Duly issued Certificate of Creditable Tax Withheld at Source (BIR Form 2307), if applicable

2.       Proof of Exemption for transactions not subject to tax, if applicable

3.       Duly approved Tax Debit Memo, if applicable

4.       Previously filed return and proof of payment, for amended return

Procedures

1.       Fill-up BIR Form 2552 in triplicate copies.

2.       If there is payment:

·         Proceed to the nearest Authorized Agents Banks (AABs) of the Revenue District Office where the local stock exchange is located and present the duly accomplished BIR Form 2552, together with the required attachments and payment. (The Percentage Tax imposed shall be paid at the time the return is filed by the taxpayer.)

·         Receive taxpayer's copy of the duly stamped and validated form from the teller of the AAB

3.       If there is no payment:

·         Proceed to the Revenue District Office where the local stock exchange is located and present the duly accomplished BIR Form 2552, together with the required attachments.

·         Receive taxpayer's copy of the duly stamped and validated form from the RDO representative.
Note: "No payment" returns filed late shall be imposed the necessary penalties by the RDO, which shall be paid at the concerned AAB.

Deadline

·          For tax on sale of shares of stocks listed and traded through the local stock exchange (LSE) – within five (5) banking days from the date of collection

·          For tax on shares of stocks sold or exchanged through primary offering - within 30 days from the date of listing in the LSE

·          For tax on shares of stocks sold or exchanged through secondary public offering
- within five (5) banking days from the date of collection

RR No. 4-95, RR 7-95, RR No. 5-97, RR No. 2-98, RR No. 7-95, RR No. 6-2001, RR No. 12-2001, RR No. 4-2002, RR No. 26-2002, RR No. 14-2003, RR No. 9-2004, RR No. 10-2004, RMC No. 6-2003, RMC No. 73-2004