Who are exempted from filing income tax?

WHO ARE EXEMPTED FROM FILING RETURNS

Exemptions to the filing of tax returns may be divided into two categories: those who are not required to file it and those who are completely exempted from filing.

Who are not Required to File Returns. The following are not required to file income tax returns:

  • Minimum wage earners
  • Income earners whose gross income for the year doesn’t exceed their total personal and additional exemptions
  • Individuals who receive income up to P60,000 from a sole employer with the income tax withheld correctly
  • Those whose income has been subjected to final withholding tax
  • Those who are qualified for substituted filing and meet the following requirements:
    • Employed by a sole employer within the taxable year
    • The individual earns purely compensation income from said employer
    • The individual’s tax due is equivalent to the tax withheld by the employer
    • For married individuals, their spouse must also comply with the said conditions
    • The employer files the annual information return (BIR Form 1604CF)
    • The employer issues BIR Form 2316 to all employees

Who are Exempted from Filing Returns. Meanwhile, these are completely exempted from filing returns:

  • Non-resident Filipinos who:
    • Have established with the BIR that they prefer to live outside the Philippines
    • Moves out of the country and lives abroad either as an immigrant or for permanent employment
    • Works and receives income abroad
    • A Filipino citizen who was previously considered a non-resident citizen
  • Overseas Filipino Workers who earn income solely from sources outside the country
  • Filipino citizens working overseas as a seaman, granted that their vessel is engaged only in international trade

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