How do you become financially stable as a private medical practitioner
- Prioritize taxes
- Give official receipts
- Get insured
As a medical practitioner, you have to put the lives of patients above yours. Because of this, you may have a hard time taking care of yourself physically, emotionally, and most of all, financially.
It is important for medical practitioners to take care of their finances. Being financially stable will lessen your business-related troubles and allow you to focus on your patients more. Thus, you need to know the different ways you can help yourself become financially smarter, including using a tax calculator in the Philippines.
Taxes are one of the most important expenses you will have to watch out for while you are working as a medical practitioner. Not paying taxes on time will lead to costly punishments which can ruin the financial stability you desire.
The VAT is the 12% tax rate added to the cost of every service you render to your patients. You have to pay for this if you are able to earn up to 3,000,000 pesos or more in sales every year. You also have the option to pay for your VAT monthly with BIR form 2551 M or quarterly with BIR form 2551Q.
You must pay for percentage tax if you have an annual sales of less or equal to 1,500,000 pesos. With each service you render for your customer, he or she indirectly pays for 3% percentage tax.
Every time you file for percentage Tax, you have to use the BIR form 2551Q and you need to pay 25 days after each taxable quarter.
Personal Income Tax
Personal income tax is supposed to be paid by anyone who is earning an annual salary above 250,000 pesos. Depending on how much salary you bring home, you can be required to pay a tax rate of 20% to 35%.
Withholding tax in the Philippines is another tax that should be paid by people who are earning through professional fees. You have the option to file using BIR form 1601-EQ, 1601-FQ, 0619-E, or 0619-F.
As a medical practitioner, your most precious resource is time. You need time to consult patients, write your observations, and implement hospital procedures. The safety of people’s lives rests on your hands. Thus, it can be hard for you to feel that your day’s work is finished.
A great way to have more time for your patients is by letting someone else do your taxes for you. In this case, Taxumo MD is an online subscription service that can do the burdensome tax paperwork for withholding and other taxes in the Philippines for you. Never worry about taxes again. Focus on your medical practice with Taxumo MD!
Give official receipts
Just like taxes, not giving official receipts can mean costly penalties in the future. You can pay 10,000 to 25,000 pesos for the first violation and 20,000 to 50,000 for the second instance.
Besides preventing you from getting penalized, ORs can be beneficial for you financially in different ways. One, it can net you more customers because having ORs means you are a trustworthy and legal business. With your ORs, you are showing to them that you follow all the medical practice rules, meaning you will not compromise the safety of your customers. Two, ORs can help you accurately record and calculate your sales in different time periods on your accounting books.
As a medical practitioner in the Philippines, you should set aside a portion of your salary to the mandatory insurances (SSS, PhilHealth, and Pag-IBIG) because these will pay off in the future.
Paying for Social Security System pension will prepare you for emergencies like illnesses and accidents. There may be a time in the future where fall ill, preventing you from working properly. SSS will help you spend less on your hospital bills by giving you cash allowance. Accidents, on the other hand, can cause debilitating disabilities. SSS will be able to give you a monthly pension to help you out.
Philhealth insurance will be there for you if you ever get a life-threatening illness Every contribution you pay will cover many diseases. Additionally having Philhealth means you can get refunded for medical expenses after 180 days.
Paying for Pag-IBIG means you automatically get a housing loan, short-term loan, and provident savings benefits.
This is meant to help you have enough finances for a home at an earlier time. You can get a house loan of 400,000 to 3 million pesos.
Can be used for unpredictable calamities and other purposes of your choice.
A portion of your monthly contributions go to an investment called provident savings and you are allowed to withdraw at the maturity date.
Knowing the different ways you can become more financially stable will help you become a better medical practitioner. You not only know the ins and outs of running a business, but also generating resources to care for yourself. When you don’t have problems in these areas, you have more energy to focus on caring for your patients.