YEAR-END-ADJUSTMENT
On or before the calendar year and prior to the payment of the compensation for last payroll period, the employer shall determine the sum of the taxable regular and supplementary compensation paid to each employee for the whole year and must ensure that the tax due is equal to tax withheld.
ANNUALIZED WITHHOLDING TAX FORMULA
Collectible : Tax Due> tax withheld - collect before payment of last salary
Refund : Tax Due< tax withheld - refund on or before January 25th of the year/ last payment of salary
Break even : Tax due = tax withheld - no more withholding for December salary