Withholding Tax Updates on your Maya Business Account

Withholding Tax Updates

In compliance to Revenue Regulations (RR) No. 16- 2023 and Revenue Memorandum Circular (RMC) No.55-2024, BIR will impose withholding tax on gross remittances made by electronic marketplace operators and digital financial services providers to seller/merchants.

Under this circular, all merchants including Maya Business’ merchants will be subjected to withholding tax for accepted payments, unless merchant’s gross remittances qualify for exemptions. This means that we will be collecting withholding tax on transactions starting October 12, 2024.

To make sure that your documents are updated with us, please submit a copy of your most updated BIR 2303 and Sworn Declaration form (if applicable) by emailing your relationship manager or uploading your tax documents to your Maya Business Manager account.

Please refer to the Frequently Asked Questions below.

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Qualify for tax exemption
through BMBE

We understand the potential impact of withholding tax for your small business. In lieu of the withholding tax implementation, you may want to check the Barangay Micro Business Enterprise/BMBE program that may qualify your small business for tax exemption.

Check if you qualify below.

  • Your business is focused on providing services and
    manufacturing products
  • Your business assets excluding land does not go above
    P3,000,000
  • Your business should not be connected to professional services
    (such as doctors, lawyers, pharmacists, etc) and are not
    connected to the operations of larger companies (Franchisees,
    operators with bond)

How to Apply:

Review the FAQs below for more information.

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Frequently Asked Questions

Got questions? We’ve got all the answers right here.
Withholding Tax
1. What is Revenue Regulations (RR) No. 16-2023, with implementing rules under Revenue Memorandum Circular 8-2024?

The new BIR rule means that Maya, as a digital financial services provider, will deduct 1% withholding tax from ½ the total sales we send to you as our merchant. This applies unless your sales are exempt from this rule.  

2. What are gross remittances?

This is the total amount you get for selling goods and services to your customers, minus sales returns; discounts; delivery fees; and VAT that Maya handles, plus service fees you pay Maya for using our payment solutions. 

3. Are other payment facility providers also implementing this?
Yes, every digital financial services provider, just like Maya, is required to apply this 1% withholding tax on ½ of gross remittances.
4. When will this take effect?

Starting October 12, 2024 , per BIR No. 79-2024, we’ll begin applying the withholding tax on gross transaction sales. This applies to all transactions from this date forward, regardless of when they’re settled. Please remember, this rule doesn’t affect any transactions made before October 13, 2024.

5. Is the withholding tax applied to transactions across all fund sources?

Yes, it covers transactions from all sources, be it BancNet, Maya Wallet, QR Ph, and more.

Exemptions
1. What businesses are exempted from paying withholding tax under RR No.16-2023?

Your business is exempt from withholding tax if: 

  • Your annual gross remittance through digital financial service providers do not exceed PHP500,000. 
  • You have a Sworn Declaration, stamped and verified by your BIR RDO. 
  • You are part of any legal exemptions or agreements such as having a Barangay Micro Business Enterprise (BMBE) certification. 
  • You are a merchant exempt from income tax (e.g., government, non-stock non-profit, entities with special registration) with necessary document serving as proof of entitlement to exemption.
2. What will happen if I submitted a valid SD but exceeded the PHP500,000 gross remittance after?
If your gross remittance exceeds PHP500,000 even after you’ve submitted a valid SD, we will start applying the 1% withholding tax on ½ of your transactions. 
BMBE Application

About BMBE

1. What is BMBE?

A Barangay Micro Business Enterprise (BMBE) is defined as any business engaged in the production, processing, or manufacturing of products, including  
agro-processing, as well as trading and services, with total assets not exceeding PHP 3 million. 

2. What is the purpose of BMBE?
The "BMBEs Act of 2002" aims to encourage the formation and growth of Barangay Micro Business Enterprises by granting them various incentives and benefits. 
3. What are the benefits of applying as a BMBE?
  • Income Tax Exemption - Exemption from income tax on income arising from the operations of the enterprise
  • Minimum Wage Law Exemption - Exemption from the minimum wage law, with the condition that BMBE employees still receive the same social security and health care benefits as other employees
  • Technology Transfer - Assistance in production and other processes for BMBE beneficiaries

BMBE Qualifications

1. What are the basic requirements to qualify for a BMBE Certificate of Authority?
  • Any person, natural or juridical, such as partnership, corporation, association and cooperative, having the qualifications and none of the disqualifications shall be eligible to register as BMBEs.
  • A person applying to be registered as a BMBE shall meet the following qualifications:
    • With an asset of not more than Three Million PESOS (Php3,000,000.00) excluding land;
    • Engaged in the production, processing or manufacturing of products or commodities, including agro-processing, trading, and services;
    • Registered with the Department of Trade and Industry for sole proprietorships;
      for juridical persons: with the Securities and Exchange Commission (SEC),  
      for corporations, partnerships, and associations; and with the Cooperative Development Authority for cooperatives. 

However, entities rendering services in connection with the exercise of one’s profession by a person duly licensed by the government after having passed a government licensure examination are disqualified from applying for BMBE Certificate of Authority. 

2. What if I'm already registered with BIR and DTI? Can I still qualify for BMBE?
Yes, you can still qualify for the Barangay Micro Business Enterprise (BMBE) registration even if you are already registered with the BIR and DTI. 
3. Does a newly opened business qualify for BMBE?
A newly opened business in the Philippines can qualify for BMBE provided they meet these criteria: It must be engaged in legal activities, have total assets not exceeding PHP 3 million (excluding land), and have been operating for at least six months before applying. BMBE registration offers benefits like income tax exemption and priority in government programs. 
4. Do businesses with 1 – 3 employees qualify for BMBE
Yes, businesses with 1 to 3 employees can qualify for BMBE provided they meet the other criteria. The number of employees alone does not disqualify a business from applying for BMBE status. The key qualifications include engaging in legal activities, having total assets not exceeding PHP 3 million (excluding land), and operating for at least six months prior to application. 
5. I have more than 1 branch for my business, should the total assets of all branches combined stay under 3 million, or should each branch individually keep its assets under 3 million
To qualify for BMBE, the total assets of all branches combined must not exceed PHP 3 million. If a business operates multiple branches, the combined value of all assets across these branches should not surpass PHP 3 million for the business to qualify for BMBE benefits. 

How to apply as a BMBE

1. How can I apply as a BMBE?

To apply as a Barangay Micro Business Enterprises, you typically need to follow these steps: 

  • Qualification Check: Ensure your business qualifies as a micro-enterprise under the BMBE Law. Your business should meet criteria such as having assets not exceeding a certain amount and being engaged in production, processing, manufacturing, trading, and services. 
  • Document Preparation: Secure a Barangay Micro Business Enterprise (BMBE) application form from the DTI office or download it here. Prepare necessary documents such as valid IDs, proof of business address, and other supporting documents like business permits and certifications.
  • Submission: Submit the completed BMBE application form along with the required documents to the DTI Negosyo Center in your area. Find the nearest one here.
  • Processing: The DTI will process your application and may inspect or verify your business premises.
  • Approval: If your application is approved, you will receive a Certificate of Authority as a Barangay Micro Business Enterprise. This certificate entitles you to various benefits and incentives provided under the BMBE Law, such as tax exemptions and easier access to credit.

It's advisable to contact your local DTI office or visit their official website for the most accurate and detailed information, as procedures may vary slightly depending on the locality. 

2. How do I process tax exemption of my Certificate of Authority to BIR?
  • Steps to process the tax exemption of your Certificate of Authority (CA) with your BIR Regional District Office (RDO):
    • Submit the DTI BMBE Certificate of Authority (COA) to the BIR RDO
    • Complete the necessary registration process with the BIR to be recognized as a Barangay Micro Business Enterprise (BMBE).
    • Please note there is no need for an online merchant to submit a Sworn Declaration once you have secured both the BMBE COA and the BIR Certificate of Registration (COR) as a BMBE.
    • Be aware that your status as a BMBE may be subject to post-audit by the BIR to ensure there are no discrepancies.

By following these steps, you can process your tax exemption with the BIR effectively. 

3. What documents will be submitted to the BIR to avail of the income tax exemption?
  • Copy of the BMBE’s Certificate of Authority
  • Sworn Statement of Assets of the BMBE and/or its affiliates 
  • Certified list of branches, sales outlets, places of production, warehouses, and storage facilities
  • Certified list of affiliates
  • Latest audited Financial Statement, Account Information Form, or its equivalent
Sworn Declaration (SD) Form
1. What is a Sworn Declaration form?
It’s a document, officially recognized by the BIR, stating that:  
  • Your gross remittance from digital financial service providers like Maya do not exceed PHP500,000.
  • Should your sales exceed beyond the threshold during the fiscal year, providers like us will automatically withhold 1% tax from 1/2 of your payments.  
Please make sure this form is completed, signed, and stamped by your BIR RDO before handing it over to us at Maya Philippines.  
2. Where do I get a Sworn declaration (SD) form and how can I submit it?
You may download the SD form here and email the BIR verified and stamped copy to your relationship manager or upload it via Maya Business Manager.

*You don’t need to submit the physical copy of the Sworn declaration.

3. When is the deadline for submission of required SD to make sure WHT will not be collected for my transactions effective October 12,2024?

Please submit a copy on or before October 4, 2024. 

4.

If I submitted my SD and COR, will I get charged with withholding tax for my transactions effective October 12, 2024?

No withholding tax will be collected on your transactions.

5. What will happen if I don’t submit the SD form?

Should you miss submitting the required form, a 1% withholding tax on ½ of your gross sales will be automatically applied to each transaction from October 12,2024, onwards, no matter your total earnings.

This rule stays in place until you get your SD verified by your BIR RDO and handed over to us at Maya Philippines. 

6. If I submitted the prescribed SD after October 12, 2024, what will happen to the collected WHT?

Maya Philippines will issue an automated BIR Form 2307 (Certificate of Creditable Tax Withheld At Source) every 5th day of the succeeding month (for the current month’s transactions). This shall be sent to the email address associated with the Merchant’s records in our system. This may be presented to BIR for handling the collected WHT.

Withholding Tax Impact
1. How will this impact my earnings from accepted payments?

A 1% withholding tax on ½ of the gross sales per transaction will be imposed.
See sample illustration below:

withholding tax

 

2. Will I get charged with withholding tax if I submitted my documents earlier than October  12, 2024?

No withholding tax will be charged for your transactions until October 12,2024.

3. What changes will I expect after October 12, 2024?

Regardless of total income or gross remittance, the withholding tax of 1% on ½ of your gross transactions shall automatically be deducted per transaction effective October 12,2024, unless the required SD was submitted on the deadline.

BIR 2303
1. What is BIR 2303?

The BIR Form No. 2303, also called Certificate of Registration (COR), is an official document that gives the holder the legal right to operate a business in the Philippines. It serves as proof that a business is registered as a taxpayer with the Bureau of Internal Revenue (BIR),

2. Why do I need to submit a copy of my BIR 2303?

It's essential for all businesses to provide a copy of their BIR 2303 (Certificate of Registration) to us, Maya Philippines Inc. This step is crucial not just for compliance with tax regulations but as part of your business responsibilities after registering with the SEC/DTI. It confirms your business's tax registration and is needed throughout your business’s operational life. 

3. How can I submit my BIR 2303 to you?

You may email a copy of your BIR 2303 to your assigned relationship manager or upload this via your Maya Business Manager at pbm.paymaya.com

4. What will happen if I don’t update my records and submit my BIR 2303?

Keep your payments flowing without a hitch by updating your records on or before October 4, 2024. Delay might mean a pause in receiving payments through Maya Business. If you are ready to get back on track, send over your BIR 2303 to your relationship manager or to docs.mayabusiness@maya.ph.

5. I don’t have a BIR 2303 yet, what are the requirements to get one?

Here's a breakdown of specific requirements for obtaining a BIR 2303 (Certificate of Registration)

  • For Corporations and Partnerships:
    • Accomplished BIR Form 1903
    • Photocopy of Mayor's Permit
    • Photocopy of SEC Certificate of Incorporation
    • Location Sketch or Vicinity Map: Include a sketch or map of the business address.
    • Tax Identification Number (TIN) of Owners/Officers
    • BIR Form No. 1906 – Application for Authority to Print Receipts and sample of Principal Receipts/Invoices.
    • Payment of Registration Fee (₱500.00)
    • Note: Additional documents may be required, depending on the nature of your business.
  • For Sole Proprietorships:
    • Accomplished BIR Form 1901
    • Any Valid ID issued by government.
    • Photocopy of Mayor's Permit
    • Photocopy of DTI Certificate of Registration
    • Location Sketch or Vicinity Map: Include a sketch or map of the business address.
    • Tax Identification Number (TIN) of Owners/Officers
    • BIR Form No. 1906 – Application for Authority to Print Receipts and sample of Principal Receipts/Invoices.
    • Payment of Registration Fee (₱500.00)

Note: Additional documents may be required, depending on the nature of your business.

6. How can I get a BIR 2303?

Here are general steps for obtaining a BIR 2303 for both corporate entities and sole proprietors.

  • Collect the necessary documents.
  • Pay the registration fee (₱500.00) applicable to your type of business.
  • Visit the local BIR office where your business is located and submit the completed forms and required documents for processing.
  • Allow the BIR to assess your documents and verify the information provided.
  • Once assessed, pay the annual registration fee as determined by the BIR.
  • Upon completion of the assessment and payment, you will be issued the BIR 2303 certificate.
Note: Be aware of any additional requirements specific to your local BIR office. If needed, consult with a tax professional for guidance throughout the process.