Taking the step to cease your tax residency in the Philippines is a significant move. Whether you're relocating for work, joining family abroad, or exploring new opportunities, it's essential to follow the proper procedures to ensure a smooth transition. Here's a comprehensive guide to walk you through the necessary steps.
Determine Your Residency Status
Review your current residency status to confirm if you meet the criteria for being considered a tax resident in the Philippines. Generally, an individual is considered a tax resident if they have stayed in the country for more than 180 days within a calendar year.
Gather Required Documents
Prepare the necessary documents that will support your application to cease tax residency. These may include your passport, visa, proof of foreign residency, employment contract abroad, and any other relevant documents that prove your intention to leave the Philippines permanently.
File a Notice of Departure
Submit a written notice of departure to the Bureau of Internal Revenue (BIR). This notice should include your full name, Tax Identification Number (TIN), address, and the date of departure from the Philippines. The notice should express your intention to cease being a tax resident.
Settle Outstanding Taxes
Ensure that all your tax liabilities in the Philippines are settled before your departure. This includes filing any pending tax returns and paying any outstanding taxes. Obtain a tax clearance certificate from the BIR to confirm that you have no outstanding tax obligations.
Deregister from Local Authorities
Notify local authorities, such as the local government unit (LGU) and the barangay office, of your intention to leave the country and cease being a resident. This step is crucial to ensure that your name is removed from local records.
Close Local Bank Accounts and Cancel Memberships
Close any local bank accounts that you no longer need and cancel memberships or subscriptions that are tied to your Philippine address. This helps to prevent any future financial obligations or misunderstandings.
Consult the Immigration Bureau
Visit the Bureau of Immigration to inform them of your intention to leave the Philippines and cease being a tax resident. Ensure that you comply with any immigration requirements and obtain the necessary exit clearance.
Maintain Records
Keep copies of all documents related to your cessation of tax residency, including the notice of departure, tax clearance certificate, and any correspondence with the BIR and other authorities. These records may be required for future reference or verification.
Legal References
- Section 22 of the National Internal Revenue Code of the Philippines (NIRC)
- Revenue Regulations No. 12-2011
- Bureau of Internal Revenue (BIR) guidelines
Useful Links
