SUMMARY OF TAX RATES Income Tax on Corporations

Income Tax on Individuals DC RFC NRFC

NRA- NRA- Business Income
RC NRC RA ETB NETB 30% on taxable income
COMPENSATION -or-
30% (GI)
INCOME 20 – 35% 25% (GI) 2% MCIT,
whichever is higher
Fringe Benefits Tax
35%
Improperly
Business Income/ Accumulated
10% X X
Income from Earnings Tax (IAET)
Practice of 20 – 35% 25% (GI)
Profession Branch Profit
Remittance Tax X 15% X
PASSIVE INCOME
Interest (currency Royalties
20% 25% (GI) 20% 30% (GI)
bank deposit, etc)
Interest (currency
Royalties on books, bank deposit, etc) 20% 30% (GI)
literary works, and
10% 25% (GI)
compositions Interest (expanded
foreign currency
15% 7.5% Exempt
Royalties (others) deposit)
20% 25% (GI)
Prizes (above 10k) Capital gains from
20% X
sale of shares of Not over 100,000 = 5%
15%
Prizes (10k and stock not traded Excess amount = 10%
below) 20 – 35% (GI) 20% X
Intercorporate
Winnings dividends GR: 15% if Tax
20% X
DC-DC = exempt Sparring Rule
Exempt
Interest (expanded FC-DC = GI applies
foreign currency e: 30% (GI)
15% Exempt Exempt
deposit system)
Capital gains from
6% CGT based
Interest (long-term sale, exchange or
on GSP or FMV,
deposit) GR: Exempt disposition of lands X X
whichever is
e: Pre-termination before the 5th year and/or buildings
higher
4 years – 5 years = 5% 25% (GI)
3 years – 4 years = 12%
Less than 3 years = 20%

Cash or Property Income Tax on Special Corporations

From DC = 10%
Dividends 20% 25% (GI)
From FC = 20 – 35% (GI)
SPECIAL RESIDENT FOREIGN CORPORATIONS
CAPITAL GAINS International
GR: 2.5% on Gross Philippine Billings
Sales of shares of Traded: Carrier
e: 30% for offline carriers/ no landing rights
stock 6/10 of 1% of Gross Selling Price
Branch Profit
Not Traded: Remittance 15% on total profits applied or earmarked for remittance
15% CGT of Net Selling Price
Regional or
Sale of real Area HQ Exempt
property in the GR: 6% CGT based on GSP or FMV, whichever is higher
Phils e: Sale of principal residence (exempt) Regional
Operating HQ 10%
Other property 6% CGT

Short-term holding period

X X
= 100% of the gain
Long-term holding period
= 50% of the gain
 SPECIAL DOMESTIC CORPORATIONS
Non-resident owner or lessor of vessels 4.5% of gross rentals, lease, or
chartered by Phil nationals charter fees from leases or
charters to Filipino citizens
Non-resident owner or lessor of aircraft,
machineries, and other equipment 7.5% of gross rentals or fees

IT RPT
Non-stock
Non-profit EXEMPT for income derived
Organizations from activities pursuant to
(11) the primary purpose for
which they were created

Charitable
Institutions, GR: EXEMPT
Religious e: income from properties or EXEMPT, if ADE used for
Organizations, from activity conducted for charitable, religious, educ
Charitable profit regardless of purpose
Hospitals disposition

Non-stock
Non-profit EXEMPT, if ADE used for
EXEMPT, if ADE used for
Educational charitable, religious, educ
educational purposes
Institutions purpose

Proprietary
GR: 10%
Educational
e: 30% if income from EXEMPT, if ADE used for
Institutions
“unrelated trade, business or charitable, religious, educ
other activity” exceeds 50% purpose
of the total income
Proprietary
GR: 10%
Hospitals
e: 30% if income from EXEMPT, if ADE used for
“unrelated trade, business or charitable, religious, educ
other activity” exceeds 50% purpose
of the total income
Government
GR: EXEMPT
Educational
e: income from properties or EXEMPT, unless beneficial
Institution
activities conducted for use pertains to non-exempt
profit, regardless of entity for a consideration
disposition
Government
Governmental functions:
Agencies
EXEMPT EXEMPT, unless beneficial
use pertains to non-exempt
Proprietary functions: entity for a consideration
Taxable
GOCCs
GR: EXEMPT
e: SSS, GSIS, PHIC, LWDs