I'm Giancarlo Enrico S. Pozon, a Wushu instructor, investor and Barrister... That's right, Barrister; I graduated from law school and took the Bar Exams, now I'm waiting for the results. I created this blog to make Philippine Law easy to understand for the average person. It's all about free legal advice. There are many law blogs. But the problem is that many of them are written for lawyers and law students. They use words that can't be understood by ordinary people.
Many lawyers, judges and law students consider themselves as superior to most human beings because of their knowledge of the law. It bothers me since the law is supposed to serve society. Since the law is meant to serve society as a whole, it is important that is must be understood by everybody.
This does not mean that we should all become lawyers. It means that although law is a highly specialized profession, the first duty of everybody in this profession is to make the law understandable to all; that's why all these articles are free legal advice.
Like I said, this blog is about law -but it's for the ordinary people, not the lawyers. It's for the ordinary folk so they will know what is good and bad for them, and that making them aware of the law will help us all improve society as a whole. This is free legal advice for everybody!
This is related to this article. When making itemized deductions, remember these important guidelines.
Requisites:
1.) Must be ordinary and necessary
2.) Must be paid or incurred during the taxable year
3.) Connected to the business, trade or profession
4.) Must be reasonable
5.) If the money received by the taxpayer is subject to withholding tax, the tax must be withheld and paid to the BIR
"Incurred" means that if the accrual method of accounting is used, income that is not yet received but already theoretically earned.
All taxpayers, including estates, trusts and partnerships, can claim itemized deduction. Non-resident aliens (last part of this article) regardless of whether or not doing business in the Philippines, as well as non-resident foreign corporations, can't claim itemized deduction.
The following items can be claimed under itemized deduction:
1.) Expenses in general
2.) Interest
3.) Taxes
4.) Losses
5.) Bad debts
6.) Depreciation
7.) Depletion of oil and gas wells and mines
8.) Charitable and other contributions
9.) Contributions to research and development
10.) Pension trusts
11.) An individual taxpayer's health and/or hospitalization insurance premium payments
"Expenses in general" are the usual day-to-day expenses of the trade, businesses or profession. These include:
1.) Travel expenses
2.) Rental expenses
3.) Salaries, wages and other forms of compensation , including grossed-up monetary value of fringe benefits given by the employer to the employee (provided that in the employee's case, the final taxes on the fringe benefits were already paid)
4.) Expenses for recreation, entertainment and amusement as long as they're not contrary to law, morals, good customs, public order and public policy
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