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Doing Good Is a Rewarding Experience. But, Did You Know It Can Also Help Lower Your Taxes?

Donations can help lower your taxes. This is because the Philippine tax code provides incentives for charitable giving through tax rebates.

Here are the steps on how to avail the tax rebate via donations:

Choose a qualified donee organization – To avail of the tax rebate, your donations must be made to qualified donee organizations. These include charitable institutions, non-profit organizations, and non-government organizations (NGOs) that are registered with the Bureau of Internal Revenue (BIR). You can check the BIR website for a list of qualified donee organizations.

Get a receipt or certificate of donation – When you make a donation, ask for a receipt or certificate of donation from the organization. The receipt should include the name of the organization, the amount of the donation, and the date of the donation.

Claim the tax rebate – You can claim the tax rebate when you file your income tax return. The amount of the tax rebate is equal to a percentage of your donation, depending on the type of organization you donated to. For donations to accredited NGOs, the tax rebate is 100% of the donation. For donations to charitable institutions and non-profit organizations, the tax rebate is 50% of the donation.

It is important to note that the total amount of donations eligible for tax rebates is subject to limitations. For individual taxpayers, the maximum allowable deduction is 10% of their taxable income, while for corporations, the maximum allowable deduction is 5% of their net taxable income.

As for organizations to support, there are numerous qualified donee organizations in the Philippines that are doing great work for various causes. Here are a few examples:

Philippine Red Cross – This organization provides disaster relief and blood services, among other things.

Gawad Kalinga – This non-profit organization aims to eradicate poverty through community development programs.

Caritas Manila – This charitable institution provides various programs and services for the poor and marginalized, including education and livelihood opportunities.

Bantay Bata – This program of ABS-CBN Foundation provides protection and assistance to abused children.

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