What is the BIR Form 2307? Certificate of creditable tax withheld at source for businesses and freelancers

Need to learn more about the BIR 2307 meaning? Or maybe you’re still wondering: what is BIR form 2307? This guide has you covered.

In the Philippines, the BIR 2307 purpose is to show what tax has already been withheld at source, so you don’t end up paying tax twice accidentally. The BIR form 2307 is a certificate of creditable tax withheld at source, provided by Bureau of Internal Revenue (BIR)¹, which can help you calculate your tax dues by claiming tax credits you may be owed. This guide covers all the basics about BIR form 2307.

This guide is for information only. It does not constitute tax advice. For more information seek advice from a professional, or from the Bureau of Internal Revenue (BIR).

What is BIR form 2307?

The full name of BIR Form 2307² is the Certificate of Creditable Tax Withheld at Source.

This form is one way to make sure you’re not over-paying tax, as it details any areas where tax has already been withheld at source - by an employer or client if you’re a freelancer for example - so you don’t accidentally pay tax twice unnecessarily.

If you need to learn more about how to compute withholding tax 2307, it’s worth talking your personal situation through with a professional tax advisor.

Who needs to complete BIR form 2307?

Often you’ll need BIR 2307 if you’re a freelancer or self employed professional in the Philippines. However, if you’re a business owner paying a contractor, and withholding tax, you could also need to understand and complete a BIR 2307 form.

Freelancers may have to have a completed BIR 2307 to claim tax credits on things like professional fees, insurance agents or bookkeepers, for example.

In short - any time tax is withheld at source, you may find this form is needed to make sure all the tax affairs of both the person paying and the person being paid are kept straight.

When is BIR form 2307 needed?

Usually you’ll need BIR form 2307 as part of your filing for BIR income tax. If you’re filing BIR form 1701, or if you’re a freelancer filing BIR Form 1701 AIF (Account Information Form for Self-Employed Individuals), you may need this form as part of your submission. Other paperwork commonly needed alongside the 1701 forms include:

• Certificate of Income Tax Withheld on Compensation (BIR Form 2316)
• Certificate of Income Payments Not Subjected to Withholding Tax (BIR Form 2304)
• Duly approved Tax Debit Memo
• Proof of Foreign Tax Credits
• Proof of prior year’s excess tax credits

As you may expect, there’s quite a bit of paperwork that might be needed as part of your tax filing in the Philippines. If you’re not sure exactly what you fill out, or if you’ve not been able to get everything you need, it’s best to ask BIR directly, or take professional advice. The BIR website is very helpful and also has a chat function there that you can use if you’re not sure what you need to prepare.

How to fill up BIR form 2307

Usually the payor will be the one completing 2307, as a confirmation that they withheld tax and remitted it to the government on behalf of the payee. Assuming you’re the payor, you’ll need to complete the personal information on the BIR 2307 form first, including:

• The dates the form cover
• Payee TIN registration
• Payee name and address

You’ll then have to complete the same information for yourself as the payor.

Once you’ve completed the first half of the form it’s time to enter the payment details. Payments where tax was withheld at source are given alphanumeric tax codes (ATCs), which are helpfully detailed on the last page of the BIR 2307. Take a look at the table of ATCs and find the code for the payment type you need to report. Bear in mind that the reason for the withholding can be split into payments subject to expanded withholding tax, and different payments subject to tax because they were received from a government agency.

Enter the code, the amounts and any required notes into the BIR 2307 to fill out the form.

How to file 2307 online

Usually, the easiest option to file 2307 online is to use the eBIR Form service that you can access on the BIR website.

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Now you have a guide to BIR 2307, when it’s used, who completes it, and why it’s important. Use this guide alongside professional advice - and don’t forget to check out Wise too, for low cost incoming payments which use the mid-market rate and low fees.

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Sources:

1. Bureau of Internal Revenue (BIR)
2. BIR Form 2307
3. Pricing/fees: Please see Terms of Use for your region or visit Wise Fees & Pricing for the most up to date pricing and fee information