NUTS (Kinds of Taxpayers)

TAXATION IN A NUTSHELL KINDS OF TAXPAYERS TAXPAYERS INDIVIDUALS Resident Citizen (RC) Non-Resident citizen (NRC) Managerial and Technical Filipino Employees of AEMOPS, RHQ, ROHQ Minimum Wage earners Resident S Alien (RA) Non-Resident Alien Engaged (NRAE) Non-resident alien not Engaged (NRANE) Alien Managerial and Technical Employees of AEMOPS , RHQ, ROHQ ESTATES AND TRUSTS

SOURCE OF INCOME

W/IN

INCOME NIT

W/ O

GIT

FIT

TAXES OPCIT of 15% Gross

MCIT of 2%

BANK INTERES T

PRIZES

WINNIN GS

INCOMES

ROYALTI ES

DIVIDEN DS

SALE OF SHARES

SALE OF REALTY

* * *

* X *

* X * * * * * * * * * X * * * * * * * * GENERAL RULE = Taxable at 15% FIT on their compensation, for other income earned, the pertinent provision of the law will be applied. But has an option to subject income to NIT

* * * *

X X X X

* * X X

X * * * * * X * X * * * * * X * * * GENERAL RULE = Taxable at 15% FIT on their compensation, for other income pertinent provision of the law will be applied. No Option.

Revocable Trust Irrevocable Trust

Domestic Corporations (DC) Proprietary Educ. Institution Special and Non-profit Hospitals GOCC’s. Agencies or Domestic instrumentalities Corporatio Domestic Depositary (EFCD ns Banks) Resident Foreign Corporations (RFC) International Carriers Special Offshore Baking Units (OBU) Foreign Resident Depositary Banks Resident (EFCD) Regional or Area HQ of Corporatio Multinational Companies ns Regional Operating HQ of Multinationals Companies Non-resident Foreign Corporations (NRFC) Cinematographic Film-owners, Special Lessors or Distributors Lessors of Vessel Chartered in NRFC the Phils. Owner or lessor of aircrafts amd other equipment PARTNERSHIPS TAX SUPPLEMENTS/2015 _JOEL OFILAN

PASSIVE IAET of 10%

* * * * * * earned, the

* * *

* *

* *

*

*

*

*

*

*

*

X

SAME TREATMENT AS INDIVIDUAL TAXPAYERS

* *

* *

* *

X X

* *

* X

* X

* X

X X

X X

X X

* X

*

*

*

X

*

*

*

*

X

X

X

*

*

*

*

X

*

X

X

X

X

X

*

*

*

X

*

X

*

X

X

X

* X

*

X

X

DC-DC = EXEM PT

EXCLUDED *

X

X

*

*

x

x

x

X

X

EXCLUDED

*

TAXATION IN A NUTSHELL KINDS OF TAXPAYERS General Professional Partnership (GPP) Business partnership

* *

* *

* *

X X

* *

* *

* *

* *

X X

X X

X X

X X

General co-partnership

*

*

*

X

*

*

*

*

X

X

X

X

SAME AS DC

CREDITABLE VS. FINAL WITHHOLDING TAX: (CREBA vs. Romulo)

Distinctions

Nature of tax withheld

Persons liable

Filing of Income tax return

Applicability

FINAL WITHHOLDING TAX ( FWT)

CREDITABLE WITHHOLDING TAX (CWT) The amount of income tax withheld by the Taxes withheld on certain income payments are withholding agent is constituted as a full and intended to equal or at least approximate the final payment of the income tax due from the tax due of the payee on said income. payee on the said income. The liability for payment of the tax rests Payee of income is required to report the primarily on the payor as a withholding agent. income and/or pay the difference between the tax withheld and the tax due on the income. The payee also has the right to ask for a refund if the tax withheld is more than the tax due. The payee is not required to file an income tax The income recipient is still required to file an return for the particular income income tax return, as prescribed in Sec. 51 and Sec. 52 of the NIRC, as amended Imposed on Capital assets

Ordinary assets

The withholding tax system is a procedure through which taxes (including income taxes) are collected. Under Section 57 of RA 8424, the types of income subject to withholding tax are divided into three categories: (a) Withholding of final tax on certain incomes; (b) Withholding of creditable tax at source and TAX SUPPLEMENTS/2015 _JOEL OFILAN

* * *

* * *

TAXATION IN A NUTSHELL KINDS OF TAXPAYERS (c) Tax-free covenant bonds.

TAX SUPPLEMENTS/2015 _JOEL OFILAN