TAXATION

FINAL
FINAL
PHILIPPINE
TAX
TAXRATESINCOME
Comprehensive: ON CERTAIN
TAX SCHEME
PASSIVE INCOME
Yield from deposit substitute 10,000
Interest income from bonds INDIVIDUAL
of a domestic corporation 23,000
Final Withholding Tax vs. Creditable Withholding Tax
Property dividend declared by a foreign corporation
PASSIVEStock dividend CITIZEN ALIEN
CORPORATIONS
40,000
Similarities: declared by a domestic corporation 50,000
INCOME Identified item of gross income
Compensation income, net of P10,000Non-Resident
Non-withhold withholding tax80,000 Non-
FINAL INCOME TAXATION
Nature:
- The income payor a percentage of the income

Thank
END.you!
PrizeResident
on “SearchResident for Mr. Sexy Resident
Body” Resident
Domestic 15,000
Resident
- Serves to avoid cash flow problems ETBto NETB
taxpayers
Interest income
- Specified passive from FCDU Depositary
income by the lawBank earned in the Philippines 18,000
EXCEPTION
Interest TESTS:
income from FCDU Deposit 35,000
Differences
- Restrictive
INTEREST
DIVIDENDS
WINNINGS
INFORMER’S INCOME
(Cash
CASHor FROM
REWARDinBANKS
Application
Property) FWT/FT CWT
Royalties Tax
- Income
Withheld from books
at Withheld
source Full 24,000
Only Portion
Taxable
PESO DC
From
PCSO/Lotto
Collected Interest income
Exempt
10%
Final TaxExempton 10%personal loan
Exempt granted
10% At Exempt
20% to a
10% Exempt friend
25%
10%
Capital Exempt 28,000
10% TaxExempt
Gains 10% 10%
15%
- ST- Coverage
Salaries20%from a general 20% professional20%either Certain 25%
partnership
20% Passive 20%
N/ACertain Passive &30%
30,000
20%
N/A N/A
Requisites:
- LT**
From
Others FC Yield Exempt
from
RIT investments
20% RIT in the
Exempt
20% form ofExempt
Exempt
20%
RIT savings
RIT Income
20% 25%
RIT 20% 93,500
RITRegular Income 30%
20%
RIT RIT
1. Definite sworn information w/c
(Deposited: 6/1/10, Terminated 10/30/14is not yet in possession of BIR
2.- (**Above
ROYALTIES
PRIZES Who
The
MostsameRemitsleadthe
Outstanding
10,000, Tax?
to discovery
below citizen
10,000awardof fraud
RIT) Income Payor Income
10,000Payor
FOREIGN 7.5% Exempt 7.5% Exempt
3. Enforcement results in recovery of revenues and or conviction ofand Exempt 7.5% the7.5% Exempt
Payeeparty
guilty
Active4.
W/O The
Effort informer
Exempt
Required: is other
RIT Compute Exempt
RITfor Regular
thanthea/an:
Exempt Income
RIT income
total RITtoTax
Exempt beExempt
RIT
subjected toRITFinal Tax.RIT RIT
- **Exempt
Necessity Long
for
- Internal
Computea Term
consolidated
Revenue Peso Interest
Officer
for the Income
final tax due. None
from banks are subjected
Required to
W/ Effort
Pre-Termination
return? - Other public rule.officials or employees
Passive
-Sports
If < 3yrs held of the above mentioned
- Relatives 20% within 6th degree of consanguinity
-Books,
w/ POC
Lit Exempt
10% Exempt
10% Exempt
10% Exempt
10% Exempt
25% 20%
N/A 20%
N/A 30%
N/A
If 3 yrs to < 4 yrs held 12%
& Musical
w/o POC
TheIfreward RIT
will<be RIT RIT RIT collected
RIT or P1,000,000.00
4 yrs to 5 lower of the 10% 5%
yrs held of revenues
- Others
-NonSports 20%**
20% 20%**
20% 20%**
20% 20%**
20% 25%**25% 20% 20% 30%
 Identified item of gross income

EXCEPTION TESTS:
Taxable
Final Tax At Capital Gains Tax
either

Regular Income Tax

Comprehensive:

Yield from deposit substitute 10,000

Interest income from bonds of a domestic corporation 23,000
Property dividend declared by a foreign corporation 40,000
Stock dividend declared by a domestic corporation 50,000
Compensation income, net of P10,000 withholding tax80,000
Prize on “Search for Mr. Sexy Body” 15,000
Interest income from FCDU Depositary Bank 18,000
Interest income from FCDU Deposit 35,000
Royalties from books 24,000
Interest income on personal loan granted to a friend 28,000
Salaries from a general professional partnership 30,000
Yield from investments in the form of savings 93,500
(Deposited: 6/1/10, Terminated 10/30/14
Most Outstanding citizen award 10,000

Required: Compute for the total income to be subjected to Final Tax.

Compute for the final tax due.