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Tax Deductibles that Doctors Should Be Claiming

Tax Deductibles that Doctors Should Be Claiming

One of the common questions that we come across from doctors in thinking about doctors taxes is what are the allowable deductions for my tax computation in the Philippines? With all of the expenses that I have, what will the Bureau of Internal Revenue allow me to declare.

What tax deductibles should doctors be claiming?

  1. Business expenses
  2. Medical supplies and equipment
  3. Membership and registration costs
  4. Professional conference and seminars
  5. Donations to charity

People should always include their tax deductibles when doing their tax computations in the Philippines. Many are already aware of this, but very few know which items and expenses are considered as deductibles. This lack of awareness has lead people to sometimes include the wrong items.

Claiming the wrong deductibles can land you in trouble with the authorities. The Bureau of Internal Revenue will audit your tax filings and will require you to pay fines and penalties—even if what you did was an innocent mistake.

Furthermore, tax deductibles exist so that you can reduce your due taxes. If you miss out on them, you will end up paying more taxes than you should. To avoid this, you have to be aware of certain deductibles that apply to your profession.

For medical practitioners, here are some of your tax deductibles for your tax computation in the Philippines:

Business Expenses

This applies to self-employed doctors who are managing their own private practice. These individuals have a lot of business expenses that they can file as deductibles. This includes the costs to operate your clinic and/or home office (if you have one) such as electric bill, Internet fee, rent, utility costs, marketing fees, travel costs, upkeep, and even mortgage.

As long as you have the appropriate receipts and records, you can deduct these expenses from your taxable income, thus lowering your tax due for that year. Be careful not to include personal expenses especially if you’re calculating deductibles from your home office. You might accidentally include expenses made by you or your family members. These things aren’t made for the benefit of your business.

Medical Supplies and Equipment

The costs of the medical supplies and equipment you use for your work can be deducted from your taxable income. This applies to all doctors, whether they manage their own private practice or not.

If you are self-employed (with a private clinic), you can do your own tax computations in the Philippines and deduct these items appropriately. But if you are under employment, you can get your employer to pay for them pre-tax. This means that the deductions are going to be taken off your gross income before it is taxed. Either way, your taxes are going to be less than before!

Some of the items included in this list are stethoscopes, tablets, laptops, briefcases, and uniforms. The machines needed to perform medical procedures in your private practice are also tax deductibles.

Membership and Registration Costs

Aside from their doctorate degree, medical professionals need to get several licenses and apply for memberships. The more specialized the field is, the more licenses they need.

These membership and license fees aren’t cheap. But they are considered deductibles which should help lighten your financial load. Also, keep in mind that the costs you incur to register your private practice are counted as tax deductibles.

You may think these expenses are small. But they can balloon after a long time since you need to renew them every once in a while!

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Professional Trainings, Conferences, and Seminars

Professional trainings, conferences, and seminars are obligatory events for medical professionals. They are required to log in a specific number of Continuing Professional Development (CPD) credits before they are able to renew their licenses.

The required number of units varies per profession and location of work. This is set by the Professional Regulation Commission (PRC), but it sits somewhere between 80 to 120 units. The only way you can gain these units is by attending trainings, conferences, and seminars. They should fall under their field of work to ensure that they remain updated about the latest advancements and technologies.

Much like license renewal fees, these events are not cheap. The participation fee alone can be worth thousands. When you include travel and accommodation costs (which are often necessary because these events are held across the country), then you are set to pay a large sum.

Luckily, these things are tax deductible. Just don’t treat it as a vacation by taking your entire family and then reducing the cost from your income.

Donations to Charities

Lastly, your donations to charities – whether monetary or otherwise – are tax deductibles. If you can get a Form 2322, then you can use the amount as tax credits. Any money you spend on charities can be deducted if the donee is allowed to issue a certificate of donation.

Key Takeaway

For doctors and other medical professionals, you can refer to this list for your tax deductibles. Be sure to file them correctly the next time you pay your taxes!

If you’re still having problems with your tax computation in the Philippines, be sure to check out Taxumo. This platform is available to those who need help with their finances.

Are you ready for an easier way to file your taxes?

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