What Does 2316 Mean on Your Tax Forms?

“2316” refers to BIR Form 2316, a tax document used in the Philippines. Officially known as the Certificate of Compensation Payment/Income Tax Withheld, it serves as a record of an individual’s compensation and the taxes withheld over a calendar year. This document is important for tax compliance for both employees and employers.

What Form 2316 Is

BIR Form 2316 is an annual tax form issued by the Bureau of Internal Revenue (BIR) in the Philippines. Employers prepare and issue this form to their employees. It provides an official record of an employee’s total compensation and the income tax withheld throughout a calendar year. This document proves that salary underwent income tax deductions and helps the BIR verify business tax compliance.

Information Found on Form 2316

BIR Form 2316 details financial information for both the employee and the employer. It includes the employee’s name, address, and Tax Identification Number (TIN). The form also specifies the employer’s registered name, address, and TIN.

The form breaks down compensation income, covering gross, non-taxable or exempt, and taxable compensation. It also states the total amount of tax withheld by the employer during the covered period. This data provides a clear picture of an employee’s earnings and tax deductions for the year.

Employee Actions with Form 2316

Employees receive BIR Form 2316 from their employers, typically by January 31 of the year following the taxable year. If an employee separates during the year, the form is provided on their last payday or upon final wage payment.

Employees primarily use this form as an attachment to their Annual Income Tax Return (ITR), such as BIR Form 1700 for purely compensation income or BIR Form 1701 for mixed income earners. For many employees with a single employer, signing and returning Form 2316 enables “substituted filing,” where their employer submits it to the BIR on their behalf, eliminating the need for a separate ITR.

The form also serves as proof of income for loan or visa applications. Employees should review the form for accuracy and report discrepancies to their employer.

Employer Responsibilities for Form 2316

Employers have several responsibilities regarding BIR Form 2316 to ensure tax compliance. They must prepare and issue the form to each employee by January 31 of the succeeding year. For employees who resign or are terminated, the form must be issued on their last day of employment or upon final wage payment.

Employers must submit copies of the signed BIR Form 2316 to the BIR by February 28 of the succeeding year, especially for employees qualifying for substituted filing. This submission involves providing scanned copies via a USB drive, accompanied by a notarized sworn declaration.

Employers must also retain their copy of the form for ten years for record-keeping. Failure to comply, including late or incorrect submissions, can result in BIR penalties.