BIR withholding tax, annualization and reports
How payroll withholds tax, and how to prepare 1601-C, 1604-C, Form 2316 and the alphalist before filing.
How withholding tax is computed
Each payroll withholds tax using the BIR semi-monthly withholding tax table (TRAIN, RR 11-2018, 2023 onward). The tax base is taxable pay (basic, overtime, night differential, holiday pay and taxable allowances) minus the employee's SSS, PhilHealth and Pag-IBIG shares.
- Minimum wage earners: their minimum wage, holiday, overtime and night differential pay are exempt. Only taxable extras are taxed.
- 13th month and other benefits are exempt up to ₱90,000 a year. Anything above it is taxable.
- The tables and the ₱90,000 cap are kept by effective date. Each payroll uses the table in force on its pay date, and year-end annualization uses the table for that tax year. See Statutory rates and updates.
Reports
| Report | Where | What it is |
|---|---|---|
| 1601-C (monthly) | HR › Compliance & Reports › BIR Form 1601-C | Tax withheld for the month from posted payroll, with the due date and remittance tracking. PDF and CSV. |
| 1604-C (annual) | 1604-C Year-End Worksheet | A worksheet that reconciles the twelve 1601-C months with annualization and your recorded remittances. It's not the filed form. |
| Form 2316 | Tax annualization › each employee | The employee's certificate, in the September 2021 layout. Employees can also download theirs from the portal. |
| Alphalist | Tax annualization › Alphalist | Schedule 1 and Schedule 2 (minimum wage earners) data as CSV. |
Suggested workflow
- Post every payroll for the month or year.
- Open the report and compare its totals with your payroll register.
- For year-end, run annualization and fix employees with exceptions or missing data.
- File through eBIRForms or eFPS. Create the alphalist .DAT file with BIR's own alphalist tool, using the CSV data.
CSV downloads are protected against spreadsheet formula injection. Godo prepares the information. It doesn't file or pay anything with BIR.
Was this article helpful?
Still stuck?
Log in to your company and open Help and Support, and our team will help you.