MANAGEMENT

Detailed explanation-1: -BIR Form No. 1701 shall be filed by individuals who are engaged in trade/business or the practice of profession including those with mixed income (i.e., those engaged in the trade/business or profession who are also earning compensation income) in accordance with Sec. 51 of the Code, as amended.

Detailed explanation-2: -In order to file as one, you must first know what a mixed income earner is. The BIR states that they are those engaged in trade, business, or profession while also earning compensation income. In short, you could be a full-time employee at a company while having a side business or part-time job.

Detailed explanation-3: -An individual whose gross compensation income does not exceed his total personal and additional exemptions.

Detailed explanation-4: -“Mixed Income Earners are persons who are any two of the following: Professionals, Single Proprietors, and Local Employees.

Detailed explanation-5: -However, in case of Mixed Income Earner, the taxable income is based on the gross sales/receipts and other non-operating income without the P250, 000 reduction, if the option availed is the 8% income tax rate.