Professional Documents
Culture Documents
CITIZENS
RESIDENT NON-RESIDENTS
Definition Sec 22 (E)
1. A citizen of the Philippines who establishes to the satisfaction of the
Commissioner that fact of his physical presences abroad with definite
intention to reside therein.
2. A citizen of the Philippines who leaves the Philippines during the taxable
year to reside abroad, either as an immigrant or for employment on a
permanent basis.
3. A citizen of the Philippines who works and derives income from abroad
and whose employment thereat requires him to be physically present abroad
most of the time during the taxable year.
4. A citizen who has been previously considered as non-resident citizen who
arrives in the Philippines at any time during the taxable year to reside
permanently in the Philippines shall likewise be treated as a nonresident
citizen for the taxable year in which he arrives in the Philippines with respect
to his income derived from sources abroad until the date of his arrival in the
Philippines.
Tax Code Reference Sec 24 Sec 24 ( income w/in the Philippines)
Sec 23 ( income outside Philippines)
Tax Base taxable income earned from all sources taxable income from all sources within the Philippines
within and without the Philippines
Tax Rates - In general 5% - 34 % in 1998 5% - 34% in 1998 (for income w/in the Phils)
5% - 33% in 1999 5% - 33% in 1999 (for income w/in the Phils)
5% - 32% in 2000 5%- 32% in 2000 (for income w/in the Phils)
5% - 32% thereafter 5% - 32% thereafter (for income w/in the Phils)
EXEMPT (for income w/out the Phils)
Tax Rates - On Passive Incomes (subject to Final Taxes [FT])
Interest on any currency bank deposit and yield or any other 20% FT 20% FT
monetary benefit from deposit substitutes [Sec 22(Y)] and from
trust fund and similar arragements
Interest from a depository bank under the expanded foreign 7.5% FT EXEMPT [Sec 2.24 RR 10-98 ]
currency deposit system [RR 10-98]
Interest on long term deposit or investment [Sec 22(FF)] in the EXEMPT EXEMPT
form of savings, common or individual trust funds, deposit
substitutes, investment management accounts and other
investments evidenced by certificates in such form prescribed
by the BSP
Pre-terminated long term investment (should actually based on 4 yrs to < 5 years -- 5%FT 4 yrs to < 5 years -- 5%FT
expired term) 3 years to < 4 years -- 12%FT 3 years to < 4 years -- 12%FT
Less than 3 years -- 20%FT Less than 3 years -- 20%FT
Other interest income derived within the Philippines 5% - 34%, 33%, 32% 5% - 34%, 33%, 32%
Other interest income derived outside the Philippines 5% - 34%, 33%, 32% EXEMPT
Royalties - in general 20% FT 20% FT
Royalties on books, other literary works and musical 10% FT 10% FT
compositions
Prizes - more than P10,000 20% FT 20% FT
Prizes - P10,000 or less 5% - 34%, 33%, 32% 5% - 34%, 33%, 32%
Prizes - PCSO & Lotto winnings EXEMPT EXEMPT
Other prizes or winnings within the Philippines 20% FT 20% FT
Other prizes or winnings outside the Philippines 5% - 34%, 33%, 32% EXEMPT
Cash and/or Property Dividends from a domestic corp or share 6% FT beginning Jan 1, 1998 6% FT beginning January 1, 1998
in distributable net income after tax of a partnership (except 8% FT beginning Jan 1, 1999 8% FT beginning January 1, 1999
general professional partnerhip), association, joint account, or 10% FT beginning Jan 1, 2000 10% FT beginning January 1, 2000
joint venture or consortium taxable as corporation
Other Cash and/or Property Dividends (e.g. from a foreign 5% - 34%, 33%, 32% 5% - 34%, 33%, 32%
corp)
On domestic shares of stock not traded through local stock 5% / 10% FT 5% / 10% FT
exchange (based on net capital gains)
On shares of stock traded through local stock exchange 1/2 of 1% FT (Percentage Tax) 1/2 of 1% FT (Percentage Tax)
(based on gross selling price) [Sec 127(A) & (D)]
On real property (based on gross selling price or FMV 6% FT 6% FT
whichever is higher) - In general
On real property sold to the government - subj to option 6% FT or 6% FT or 5% - 34%, 33%, 32%
5% - 34% 33%, 32%
On real property sold to acquire or construct new principal EXEMPT subj to certain conditions EXEMPT subj to certain conditions
residence
Atty. Marissa O. Cabreros, CPA as of April 2016
INCOME TAXATION OF INDIVIDUALS: ALIENS
ALIENS
NON-RESIDENT ALIEN
RESIDENT ALIEN ENGAGED IN BUSINESS NOT ENGAGED IN BUSINESS
CORPORATIONS
RESIDENT NON-RESIDENT
DOMESTIC FOREIGN FOREIGN
Definition Sec 22 (B) & (C ) Sec 22 (H) Sec 22 (I)
Applies to corporation created or Applies to foreign corporation Applies to a foregin corporation
organized in the Philippines or engaged in trade or business not engaged in trade or business
under its laws within the Philippines within the Philippines