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Excessive Allowance - Tax Evasion?

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1 Excessive Allowance - Tax Evasion? on Mon Oct 09, 2017 3:17 pm

mateyo28


Arresto Mayor
Example :

GrossPay : 150,000
Basic: 50,000
None Taxable Allowance: 100,000

This is obviously illegal because they are not including the NTA in 2316? Or am I wrong?

Is the employee liable for this or it is the company's?

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2 Re: Excessive Allowance - Tax Evasion? on Tue Oct 10, 2017 8:56 am

mikos23


Reclusion Temporal
Mateyo / JOsh,

why would you ask this? You are not an accounting, nor an hr professional. would you want to be a whistle blower?

It is obvious that the compensation that you are showing is managerial level and above (executive). When talking about the compensation of those managerial and up, it is not the same as rank and file and supervisor. Managerial and executive level have the capacity to negotiate their compensation with the companies, thus the arrangement is given (lower basic, higher NTA).

Usually the NTA is a representation allowance (always mis-termed as NTA), an allowance that the company give to a manager / executive for use as a business expense, thus it is not a personal allowance / income of the manager / executive. It will be put as an expense of the company, thus the manager / executive needs to give receipt equal to or more than the issued allowance. It is also the reason that it is not put in the 2316.

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3 Re: Excessive Allowance - Tax Evasion? on Tue Oct 10, 2017 1:50 pm

mateyo28


Arresto Mayor
Im not Josh. Excuse me? Are you presuming I am someone else you know?

why would you ask this? You are not an accounting, nor an hr professional. would you want to be a whistle blower?

You don't know my position yet. Why are you assuming too much? I am asking this to know if an employee is liable or not. If I will be liable or not.

As what is written in above. Is is a NTA. And not business expenses.

Please do not make too much assumption without asking.

Thanks

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4 Re: Excessive Allowance - Tax Evasion? on Tue Oct 10, 2017 3:37 pm

mikos23


Reclusion Temporal
I Apologize to call you Josh, and you are right I assume that, since before I answered your query, i looked you up on your previous post if you are an HR, Account or managerial level.

I called you josh because of your posted last July 25 2016 and you introduced yourself as Josh, 16 years old, joined a male pageant..... my mistake.

In regarding to NTA, as I have stated it is always termed as NTA.

Let's look at it in another point of view. When you negotiated your salary with a company, lets say I want at least a net of 120k, the company will proposed or give you a job offer of 50k basic and 100k NTA. Now what is your agreement with the company, who will pay the tax of the 100k. If the company agreed to pay the tax of the 100k, they will include it in your 2316. if the company stated that they will take care of it, meaning they can write it off as a business expense in their books.

Now you want to know if you are liable for it or not? it depends on how you get it. if you get it as an nta, stated in your payroll and payslip as nta, you and the company will be liable since it is part of your compensation as written in the payroll register. BIR will see it (if there is an audit) as part of your income and look for corresponding tax payment.

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5 Re: Excessive Allowance - Tax Evasion? on Wed Oct 11, 2017 1:34 pm

mateyo28


Arresto Mayor
Yes it is stated in the payslip as allowance. Almost all of the employees has this NTA(including me) greater than the basic. I am just worried because I cannot declare my gross salary in Pagibig applications because it is not included the 2316.

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6 Re: Excessive Allowance - Tax Evasion? on Wed Oct 11, 2017 2:35 pm

mateyo28


Arresto Mayor
They just wont allow me to use my gross pay(including the NTA) in my salary declaration fort pagibig loans.

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