When the BIR released the BIR Form 1701A in early 2019, it quite stirred some confusion.
Previously, all self-employed and mixed-income earners had been using the BIR Form 1701 for filing their income tax. But now, there are two seemingly similar tax forms to accomplish.
So, which is the correct form to use?
First off, BIR Forms 1701 and 1701A are different from each other. Each of them covers different types of the taxpayer, tax rate, and deduction method.
For your quick reference, here’s a table showing which of the two BIR forms you should be filing:
As you can see, all mixed-income earners—regardless of the chosen tax rate and deduction method—should file the BIR Form 1701.
Self-employed individuals can use either the BIR Form 1701 or BIR Form 1701A depending on their chosen tax rate and deduction method.
- BIR Form 1701 – For self-employed taxpayers availing of itemized deduction under graduated tax rates
- BIR Form 1701A – For self-employed taxpayers availing of optional standard deduction under graduated tax rates OR the 8% preferential tax rate
Go back to the main article: How to File Income Tax Return in the Philippines: A Beginner’s Guide