BIR eyes Ironman prize money; ‘We already set aside tax’
Ironman champ Brent Mcmahon (CDN PHOTO/CHRISTIAN MANINGO)
THE Bureau of Internal Revenue (BIR) isn’t done yet.
After going after doctors and lawyers, the country’s primary revenue agency is turning its sights on the organizer and winners of the recently concluded Cobra Ironman 70.3 Philippines.
The cash prizes, which range from $750 to $5,000 for the Ironman Pro athletes category, are taxable said lawyer Neri Yu, acting chief of BIR 7’s legal division.
“Whether the winners are Filipinos or not, each of them has to comply with a withholding tax of 20 percent of the cash prizes they receive,” he told Cebu Daily News.
Reached for comment, the organizer of the international triathlon assured that this basic tax guideline was already implemented.
“The prize money of the winners in all divisions of the Ironman 70.3 were already tax deducted 20 to 25 percent . We agreed on this matter beforehand with the winners. We, the organizers, remitted the taxes to the BIR,” said Princess Galura, project director of Sunrise Events Inc.
Canadian triathlete Brent McMahon topped the pro men’s division last Sunday, and bagged the top prize of US$5,000 or about P220,000.
Athletes compete in the Ironman 70.3 not mainly for the prize money but to qualify for a spot in the Ironman world championshp.
The prestige can also bring opportunities to become commercial endorsers later.
Caroline Steffen of Switzerland ruled the women’s pro division for the third year in a row.
Foreign athletes usually top the pro division. The first six placers receive various amounts that start at $750.
In the elite division, the top three winners got P50,000, P30,000, and P20,000.
Under he National Internal Revenue Code of the Philippines otherwise known as the Tax Reform Act of 1997, “prizes (except prizes amounting to P10,000 or less ) shall be subject to tax.”
Yu said the event organizer has until next month to submit its Statement of Expenses, Income Tax Returns, Valud Added Tax Returns, the amount of sales, and how much they gave to the winners.
“The exemption is when the prize or award is granted to athletes who bring honor to the Philippines,” Yu explained.
“We’re waiting for their report on or before September. Let’s see if they have complied with their tax dues,” he said.
Earlier the BIR regional office sent notices to over a hundred lawyers based in Cebu and Bohol due to a very low tax compliance rate.
The bureau aims to increase tax compliance of professionals and self-employed individuals as well as to compel them to pay correct taxes.
Yu said the BIR monitors commericial events like concerts, triathlon, and basketball games to find out if organizers pay the correct taxes.
“The bigger the prize, the danger of not reporting it,” Yu said.
BIR 7 Regional Director Hermeno Palamine, in a separate interview, said the BIR is trying to increase tax compliance.
“We noticed that many professionals do not pay correct taxes. We have to intensify tax collections because we need money to finance government projects,” he said. /With Correspondent Glendale Rosal
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