COMMUNITY TAX Juridical persons liable to community tax
Nature of Community Tax
Community tax formerly a residence tax is
essentially a poll or capitation tax which means
fixed amount is imposed on certain inhabitants
without regards to their properties and
occupation.
Community tax was introduced by the Spaniards
in 1884 making it one of the oldest sources of
revenue of local governments. Its enactment was
a result of reform decree abolishing tribute.
Individuals Liable to Community Tax
1. Every inhabitant of the Philippines eighteen
(18) years of age or over who has been
regularly employed on a wage or salary
basis for at least thirty (30) consecutive
working days during any calendar year;
2. who is engaged in business or occupation;
3. who owns real property with an aggregate
assessed value of One thousand pesos
(P1,000.00) or more;
4. who is required by law to file an income
tax return
Tax Rate
Basic Community Tax 5.00
Additional Community Tax 1.00 for every
1,000 income derived regardless of whether
from business, exercise of profession, or from
property but which in no case shall exceed
P5,000
* In case of Husband and Wife, additional tax
imposed shall be based upon total property
owned by them and the total gross receipts or
earnings derived by them.
Every corporation, no matter how created or
organized, whether domestic or resident foreign,
engaged in or doing business in the Philippines
shall pay an annual community tax.
Tax Rate
Basic Community Tax 500.00
Additional Community Tax 2.00 for every
5,000 of:
1. Assessed value of real property in the
Philippines owned by a corporation.
2. Gross receipts or earnings from business
in the Philippines by a corporation.
But in no case shall exceed 10,000.00
* Dividends received from another corporation
shall be considered part of gross receipts
Optional Community Tax
One peso (1.00) for an individual or corporation
which is exempt from community tax who
desires to pay a community tax for whatever
legal purpose they may desire to make use of it.
Exemptions
1. Diplomatic and consular representatives
2. Transient visitors when their stay in the
Philippines does not exceed three (3) months
Place and Time of Payment
The community tax shall be paid in the place of
residence of the individual, or in the place where
the principal office of the juridical entity is
located.
The community tax shall accrue on the first (1st)
day of January of each year which shall be paid
not later than the last day of February of each
year.
(a) If a person reaches the age of eighteen
(18) years or otherwise loses the
benefit of exemption on or before the
last day of June, he shall be LIABLE
for the community tax on the day he
reaches such age or upon the day the
exemption ends.
(b) If a person reaches the age of eighteen
(18) years or loses the benefit of
exemption on or before the last day of
March, he shall have twenty (20) days
to pay the community tax without
becoming delinquent.
(c) Persons who come to reside in the
Philippine or reach the age of eighteen
(18) years on or after the first (1st) day
of July of any year, or who cease to
belong to an exempt class on or after the
same date, shall NOT BE SUBJECT to
the community tax for that year.
(d) Corporations established and
organized:
on or before the last day of June
- liable for tax
on or before the last day of March
- 20 days within to pay without
becoming delinquent
on or after the first day of July
- NOT subject tax for that year
Note: If the tax is not paid within the time
prescribed above, there shall be added to the
unpaid amount an interest of 24% per annum
from the due date until it is paid.
Community Tax Certificate - shall be issued to
every person or corporation upon payment of the
community tax. A community tax certificate
may also be issued to any person or corporation
not subject to the community tax upon payment
of One peso (P1.00).
When presentation of community tax certificate
required
1. An individual liable to the tax
acknowledges any document before
a notary public
2. He takes the oath of office upon
election or appointment to any
position in the government service
3. He receives any license, certificate
or permit from any public authority
4. He pays any tax or fee
5. He receives any money from any
public fund
6. He transacts other official business
7. He receives any salary or wage
from any person or corporation
It shall be the duty of the public
official with whom such transaction is
made or business done, to require such
corporation to exhibit the community
tax certificate
From January until the fifteenth (15th)
of April each year, the exhibition of
the community tax certificate for the
previous year shall suffice
The representation of the certificate is
not required in connection with the
registration of a voter
Printing of community tax certificates and however, that said Barangay treasurer
distribution of proceeds shall be bonded in accordance with
existing laws.
(a) The Bureau of Internal Revenue shall
cause the printing of community tax
certificates and distribute the same to
the cities and municipalities through
the city and municipal treasurers in
accordance with prescribed
regulations. The proceeds of the tax
shall accrue to the general funds of the
cities, municipalities and Barangays
except a portion thereof which shall
accrue to the general fund of the
national government to cover the
actual cost of printing and distribution
of the forms and other related (c) The proceeds of the community tax
expenses. actually and directly collected by the
city or municipal treasurer shall
The city or municipal treasurer accrue entirely to the general fund of
concerned shall remit to the national the city or municipality concerned.
treasurer the said share of the national However, proceeds of the community
government in the proceeds of the tax tax collected through the Barangay
within ten (10) days after the end of treasurers shall be apportioned as
each quarter. follows:

50% general fund of the city or

municipality concerned;
(b) The city or municipal treasurer shall
deputize the Barangay treasurer to 50% Barangay where the tax is
collect the community tax in their collected.
respective jurisdictions: Provided,