Computation for Tax Refund

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People normally pay for their withholding tax and the necessary deductions are being computed by the accounting department of a given company. There is a table that serves as a guide to employers on how much should be deducted from their employee’s actual gross income. Normally it is between 5 to 32 percent depending on the employee’s income bracket. Big companies have particular software to compute for the taxes that’s why there are instances wherein tax adjustments should be made.

It is important for you to know the exact computation of the taxes that should be withheld from your salary so as to give you an idea on how much money goes to your taxes. Having the right information can be helpful so you’ll know if you’re eligible for a tax refund or not. Deductions are done on a monthly basis and at the end of the year when the final taxes are computed, the company that you are working for will know if they have deducted more than enough or not. If yes, they will give you a tax refund. There are three ways on how they can credit back the adjustment return.

  1. Some companies give the tax refund during the first month of the coming year. They usually credit it back to your account within the month of January. The actual date may vary depending on the company that you are working for.
  2.  There are those who give the tax refund together with the 13th month pay and other bonuses. Bonuses are usually given on the first week of December. However, there are companies who give their refunds and bonuses on the 15th of December together with the salary. Companies have their own calendar dates and it would be better if you’re familiar on the dates when they give out these refunds and bonuses.
  3. There are companies who no longer withhold taxes during the last month of the year and this is their way of giving you your adjustment return. Most companies use the annualized withholding tax method for them to know if they have deducted too much from your salary.

Here is a sample computation for a tax refund though this may vary depending on your income bracket.

Gross: P180, 000.00
Less: P15, 000.00 >>> 13th Month Tax Exempt
P6, 000.00>>> Government Dues or exemptions (this is just an example and there may be variations on this part)
Taxable Income: P159, 000.00
Tax Due For the Year: P39, 750.00
Tax w/held from Jan to Dec: P43,250.00 / 12 = P3, 604.17 (that means that the average withholding tax being deducted from your salary each pay day is P1, 802.085)
Tax Refund: P3,500.00 (this should be the total amount that you should be getting from your tax refund)

You can ask the accounting department in your office if you have any further questions regarding your taxes and tax adjustments for that matter. They will surely oblige and give you the exact computation that you are asking for to further enlighten you why they came up with such numbers. After all, it’s your money and you worked hard to earn that salary.


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7 Responses to “Computation for Tax Refund”

  1. hi, can you help me compute my ITR? i stayed at my previous company for 1 year and 2 mos..my basic salary is 11,600..can you help me on that? Thanks

  2. Delilah Malabanan

    Good day

    Can you help me also. My basic is P20,000. I started in the company last Feb.27, 2012. I am really confused because i got a tax refund just only P4,999.88. is this figure correct? Do let me know. Many thanks

    • joey

      hi Delilah,

      Are you still with Spartan Allied Services?

  3. Ephraim Genonangan

    Good day!

    Can you also help me on may tax refund? May base pay was Php 22,000 then got adjusted to Php 26,000 but the tax refund that i’ve got was just Php 1,027.63. Hope you could help me on this.

    Thanks and more power!!!

  4. ei need some help ive been wth the company from January 3-dec 17,2012! but i was computed only until dec 13! no tax refund neither when I got my separation pay and has a deductions of almost P5k so other than the 4days missing in my worked days so i got unexpectedly barely more than 10k SEPARATION PAY huh? Is that the right amount and there really is NO TAX REFUND AS THEY DIDNT DEDUCT TAX LATE 2012 LIKE NOV-DEC THEY SAID FOR THE ANNUALIZATION WHATEVER THAT IS and also the itr I got is for 2013 while I am no longer connected and failed to get my itr for 2012 I worked for them. PLS HELP ME UNDERSTAND BETTER…ANYONE?

  5. karen

    hi i just wanna know how to compute my final pay including itr and 13thmonth pay. our hr said ill be having my final pay including itr and 13thmnth. …im already separated wth the company.. i just wanna know how to compute it. thanks

  6. Rosario Talavera

    Good day Im already separated with my employer last Dec.3, Im asking for my tax refund which they deducted me from August-November 2013. I work there for only 4 month but the total wtax deductions was 7,047.82. Is the computation right. My monthly rate is 18k and Im a single mom with 1dependent. Can u help compute may refund. Because as far as i know I will refund all the full amount and yet they will only give me an ITR. Please it was a big amount of money.


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