business income payment tax – remittance and annual ...€¦ · annual reconciliation forms for...

Internal Revenue Commission - “Your Partner in Nation Building” Document ID: 2014-TPG-P5-02 Effective From: 11 March 2014 of 4

INTERNAL REVENUE COMMISSION

TAXPAYER GUIDE

BUSINESS INCOME PAYMENT TAX – REMITTANCE AND

ANNUAL RECONCILIATION FORMS FOR 2013

The Internal Revenue Commission has recently modified the process and stationery for submitting

Business Income Payment Tax (Paying Authority Tax). The new process is a result of extensive analysis

based on feedback received from taxpayers and represents an on-going effort on the part of the IRC to

improve service delivery and reduce compliance costs for taxpayers.

NEW MONTHLY REMITTANCE FORM A new Monthly Remittance form for the Business Income Payment Tax has been issued by the IRC. This

form is called a P5 – “Business Income Payment Tax Remittance Advice Form”, and this replaces any other

monthly forms issued in prior years. You may download a copy of the P5 form from the IRC website at

http://www.irc.gov.pg/tax_forms.html , request a copy by Email at [email protected], or pick up a copy

in person from the IRC office of your choosing. The form may be completed by hand, or completed

electronically.

The traditional, multiple carbon copy form is no longer in use and has been replaced by a much simpler

form in order to make it easier for taxpayers to comply with their obligations.

The new P5 form looks like this:


Please note that the form no longer requires details of each individual payment made during the month.

Only the totals for the month are required. The detail information now forms part of the annual

reconciliation discussed in the next section.

NEW ANNUAL RECONCILIATION FORM A new 2013 Annual Reconciliation form for the Business Income Payment Tax is being distributed by the

IRC. This form is called a P8 – “Business Income Payment Tax Reconciliation Statement”, and this replaces

any other Annual Reconciliation forms issued in prior years. You may download a copy of the P8 form

from the IRC website at http://www.irc.gov.pg/tax_forms.html , request a copy by Email at

[email protected], or pick up a copy in person from the IRC office of your choosing. The form may be

completed by hand, or completed electronically.

The new P8 form looks like this:

Note: As part of the standardisation of the forms and processes, some forms have been eliminated or

consolidated. The C9 “Annual Income Reporting Statement” has been combined with the P7 “Income Tax

Deduction Certificate” as part of the P8 “Business Income Payment Tax Reconciliation Statement”. There is no

longer a need to wait for C9 and P7 stationery to be sent to you – the new P8 form is available for


download from the IRC web site (www.irc.gov.pg) or from your nearest IRC office. This updated process

makes the complying with your tax obligations simpler and more streamlined.

The process has changed and the new form covers what used to be included in the old C9 and P7 forms.

The P8 is now used for the annual reconciliation of BPT plus for advising suppliers (business income

payees) of the deductions made on their behalf during the year (which was previously done using the P7

form). i.e. The payer must complete one P8 with every payee listed on it and lodge that with the IRC, plus

complete a P8 for every payee, showing only their data.

Note that when providing the P8 to payees, the form should only include the total of payments made to

that business income payee. The annual reconciliation version of the P8 is sent to the IRC and it contains

the payments made to every payee (with a contract value exceeding 500 kina). From 1 January 2014, that

threshold is increased to 5,000 kina.

COMPLETING THE RECONCILIATION FORM

Here are some tips for completing the Reconciliation Form:

Page 1:

• At the top right-hand side of the form there is a space for the TIN of the withholder. The TIN is the

Taxpayer Identification Number – a nine-digit number that is issued by the IRC to every taxpayer.

TINs are replacing Tax File Numbers (TFNs) in the PNG tax system. One TIN will cover all of your

tax obligations – Salary & Wages Tax, Dividend Withholding Tax, etc. If you have not yet been

issued a TIN, please contact your nearest IRC office to have one issued.

Note: TINs are issued centrally from Revenue Haus in Port Moresby; however the Provincial IRC

offices can receive TIN applications and submit them for processing on your behalf.

• The Business Income Payment Tax Remittances section lists each month of the year and the

amounts that you have remitted to IRC. This is the amount payable for each monthly return

throughout the year. Total (1) is the sum of the twelve months.

• Total (2) shows the total Tax Deductions from the schedule of the payments made for the year

detailed on page 2.

Page 2:

• The Details of Business Income Payment Tax schedule requires the TIN, Name and Address, Gross

Amount and Tax Deducted totals for the whole year. Only one line per person/business is required

and this represents the total amounts paid to the person/business. Do not list each payment made to

the person/business, just the totals for the year. If you do not know/store their TINs or addresses

then this information should be obtained before completing the form.

• Please note that where Total (2) from the schedule of the deductions does not match Total (1) then

your forms do not reconcile for the year and you should review your information and correct any

errors. If your Reconciliation Statement does not balance then a detailed explanation is required.


• Note that in addition to the P8 that is sent to the IRC, a separate P8 form must be sent to each payee

listed in the table on page 2 of the form – showing only the payments made to that payee.

Page 3:

• Page 3 of the form covers payments made under contracts to payees who provided a Certificate of

Compliance number and so did not have any BPT withheld from their payments. This schedule

replaces the old C9 form, which is no longer in use.

• A copy of the P8 with all contractors listed in the schedules on pages 2 and 3 must be attached to

your annual Income Tax return when it is lodged with the IRC.

SUBMISSION OF SCHEDULE ELECTRONICALLY

The IRC has now made available the opportunity to submit an electronic file of the schedule data. This

enables taxpayers to submit schedule to the IRC in an excel template. The excel template is available from

the IRC and can be submitted via e-mail or on other physical media such as CD or DVD.

Templates for the electronic completion of the schedule extract may be requested by e-mailing

[email protected]

A sample extract from the template looks like this:

The electronic submission can be delivered

• By e-mail to [email protected] (preferred)

• On physical media and either posted or delivered to your local IRC office.

IRC CONTACT DETAILS

For further information on the new process contact:

Arua Naime

322 6714, [email protected]

Christopher Anderson

[email protected]

Oke Millett

[email protected]

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