I’ll be the first to admit that when one of the biggest reasons why I wanted to go the work-from-home route is the chance not to pay may taxes and other government-related fees. I was just starting out in the corporate world and annoyed at the amount of money being deducted from my meager salary every time my payslips would be sent. The reasons for my frustration is a different issue I could talk about extensively in another post, but it’s one of the biggest reasons why I, along with many other online professionals, have gone this route.
But after some time, I personally felt the importance of paying my taxes. Besides feeling a little bit of guilt as I was the only one in my family not paying taxes, the benefits I saw from doing so definitely outweigh whatever inconvenience I would feel by ‘losing’ money each month.
As Filipinos citizens living in the Philippines, we are obligated to pay our taxes. Not doing so is actually against the law, and we may get in trouble for it. You wouldn’t want to wait for the Bureau of Internal Revenue (BIR) to coming knocking on your door?
You can refer to the Tax Code of the Philippine Constitution, particularly section 23 which specifically states who have to pay taxes, including those who derive their income outside of the country. So, even if your client is based in Australia, the US, or elsewhere overseas, your income is still subject to taxes.
You will also be doing your part in funding many government projects and expenditures, that you may have a use for in the future. The taxes you pay go to the roads you walk and drive on, the transportation that you use, to name a few.
The Income Tax Return (ITR) is an important document that is proof of your financial capability. Most of the time, businesses will require their customers of this type of document when you purchase any of their goods or services. For instance, banks require these when you apply for a credit card or a loan.
If you want to visit countries that require a visa, you would need to present them with an ITR. It’s not a guarantee of being granted a visa, but it would be in your best interest if you had one. It would save you a lot of hassle from coming up with additional documents to show your income, where some of which are not even accepted at certain embassies.
Simply put, it’s a good idea to have your ITR handy as an income-related document.
Are you thinking of purchasing a car or a house, or maybe starting your own business? Unless you’re planning to buy these big, lifetime items with cash (which is okay too), then securing a loan from the bank or other companies is the next best option.
You would need to prove that you can make the monthly payments before they loan you money, and the ITR is a good document that you can provide.
These reasons should be strong enough for you to register as an online worker and continue paying your taxes just as you did when you used to work in the corporate set-up. There are numerous resources online that can help you transition into a tax-paying online worker or VA.
Another option is to be a remote or online worker for a company that has legal business operations here in the Philippines, like AwayTeam. We take care of the filing and payments for our online workers, so they don’t need to go to BIR and fix the papers on their own! They can continue working from home and remotely, knowing that they are fulfilling their civic duty by paying their taxes.
It is our hope that more and more freelancers, VAs, online workers and remote staff follow suit too.