Tax of Social Media Influencer, Slides of Business Taxation and Tax Management

Download Tax of Social Media Influencer and more Slides Business Taxation and Tax Management in PDF only on Docsity! TAXATION OF INCOME RECEIVED BY SOCIAL MEDIA INFLUENCERS Revenue Memorandum Circular 97-2021 • Issued by BIR on August 16, 2021, effective immediately. • To remind influencers of their obligations under tax law and the possible consequences of their failure to pay taxes. •Business Tax Percentage Tax - Self-employed individuals whose gross sales or gross receipts and other non-operating income do not exceed the VAT threshold of P3M shall have the option to avail of the 8% tax on gross sales or gross receipts and other non-operating in excess of P250,000. Value-Added Tax - a business tax imposed and collected from the seller in the course of trade or business on every sale of properties, lease of goods or properties or vendors of services. • Self-employed Individuals – are those practicing their profession, with or without a license under a regulatory board or body.  8% base on gross, in excess of P250k  Sec. 24(A) • Mixed Income Earner – are those who are earning both compensation income and income from business and/or profession. 1. Compensation – Sec 24(A) 2. Social Media Income  8% Base on gross receipts, in excess of P250k Sec 24(A) Influencer Income i. YouTube Partner Program • Advertising Revenue – the influencer gets ad revenue from display, overlay and video ads. • Channel Membership – the influencer makes recurring monthly payments in exchange for special perks that he/she/ it offers. • Merch Shelf – followers can browse and buy official branded merchandise from the influencer’s watch pages. • Super Chat and Super Stickers – followers pay to get their messages highlighted in chat streams. • YouTube Premium revenue – the influencer gets a part of a YouTube Premium subscriber’s subscription fee when followers watch his/her/its contents. Allowable Deduction 1. Filming Expenses 2. Computer Equipment 3. Subscription and Software licensing fee 4. Internet and communication expenses 5. Home office expenses 6. Office Supplies 7. Business expenses 8. Depreciation expense 9. Bank charges and shipping fee Tax Compliance A. Registration and updates Section 236(A) of the NIRC states that every person subject to internal revenue taxes are required to register with the appropriate Revenue District Office (RDO) while paragraph (E) thereof states that any person registered shall, whenever applicable, update his registration information with the RDO where he is registered, specifying therein any change in type and other taxpayer details. B. Keeping of Books of Account Section 232 of the NIRC requires a taxpayer required by law to pay internal revenue taxes to keep books of accounts duly registered with BIR, which shall contain all transactions and results of operations. C. Filing of Tax Returns and Payment of Taxes Every taxpayer who is engaged in trade or business is liable for income and business taxes (percentage or value-added tax) unless exempted pursuant to the provisions of the NIRC of 1997, as amended, and other existing law. SEC.255. Failure to File Return, Supply Correct and Accurate information, Pay Tax Withhold and Remit Tax And Refund Excess Taxes Withheld on Compensation. Any person required under this code or by rules and regulations promulgated thereunder to pay any tax make a return, keep any record, or supply correct and accurate information, who willfully fails to pay such tax, make such return, keep such record, supply correct and accurate information, or withhold or remit taxes withheld, or refund excess taxes withheld on compensation, at the time or times required by law or rules and regulations shall, in addition other penalties provided by law, upon conviction thereof, be punished by a fine of not less than Ten thousand Pesos (P10,000) and suffer imprisonment of not less than one (1) year but not more than ten (10) years. Tax Residency Certificate - is an official document issued by BIR, through the ITAD, that certificates the tax residency of a certain taxpayer in the Philippines pursuant to the residency provision of the relevant tax treaty. THANK YOU!!!