BASIS OF TAX COMPUTATION

Based on GROSS SALES or RECEIPTS

VAT 12%
OPT
† Tax on person exempt from VAT under Sec. 109 where 3% (monthly)
annual gross sales/receipts do not exceed 3M –
† OPT on international carriers (PH to FC) 3% (monthly)
† OPT on franchise of radio and/or TV broadcasting company 3%
(≤10,000,000)
† OPT on franchise on gas and water utilities 2%
† OPT on PAGCOR and its licensees and franchises 5%
† OPT on bank and non-banks performing quasi-banking on
INTEREST, COMMISSION, DISCOUNT from lending, INCOME
from financial leasing
-maturity period ≤5 years 5%
-maturity period > 5 years 1%
Other GROSS INCOME –royalties, rentals, profit from exchange 7%
NET TRADING GAINS –foreign currency, debt securities, derivatives 7%
† OPT on other non-bank financial intermediaries
-INTEREST, COMMISSION, DISCOUNT and all other items treated
as GROSS INCOME 5%
INTEREST, COMMISSION, DISCOUNT from lending, INCOME
from financial leasing
-maturity period ≤5 years 5%
-maturity period > 5 years 1%
† Jai-alai and race track 30%
† Cockpits, cabarets, night or day clubs 18%
† Professional basketball games 15%
† Boxing exhibition 10%

OSD
-for individual taxpayers not exceeding 40%
8% Optional Income Tax
-for individual taxpayers (Note: Gross Sales/Receipts less 250) 8%

Based on GROSS INCOME (Gross Sales less Returns/Allowances and COGS excluding income exempt from income tax and
income subject to FIT)
OSD
-for partnership (Note: Gross Income less OSD based on GI) not exceeding 40%
-for corporation (Note: Gross Income less OSD based on GI) not exceeding 40%
SPECIAL NONRESIDENT FOREIGN CORPORATION
-Nonresident cinematographic film owner, lessor or distributor 25%
-Nonresident owner or lessor of aircraft, machinery and other equipment 7 ½%
-Nonresident owner or lessor of vessels chartered by PH nationals 4 ½%
PEZA-REGISTERED ENTERPRISES
-(3/5 of 5% due to BIR and 2/5 of 5% is due to Local Government) 5%
MCIT for CORPORATIONS (except SPECIAL DC and FC)
-Domestic corporation –Gross income within and without 2%%
-Resident Foreign Corporation –Gross income within 2%
(Note: MCIT is imposed on the 4th taxable year immediately following
the year in which such corporation commenced its business operation)
OPTIONAL CORPORATE TAX
-Domestic 15%
-Resident FC 15%
-Non-resident FC not applicable
Based on NET INCOME
SPECIAL DOMESTIC CORPORATION
† Proprietary Educational Institution 10% but if income from
unrelated business exceeds
50%, a 30% rate applies
† Nonprofit Hospital 10% but if income from
unrelated business exceeds
50%, a 30% rate applies
† GOCCs same as those imposed
upon corporation or
association engaged in
similar business or
activity
Based on IMPROPERLY ACCUMULATED TAXABLE INCOME
† Corporation 10%

Based on GROSS PHILIPPINE BILLINGS

† International Carrier 2½%

Based on TOTAL PROFITS without deduction for the tax component

† Branch Profit remittance of special resident foreign corporation 15%

Based on HIGHER AMOUNT

OPT
† OPT on domestic carriers and keepers of garage 3% (monthly)
(transport of passenger) –ACTUAL or MINIMUM monthly
gross receipts
CAPITAL GAIN TAX
† Sale of real property classified as capital asset located in PH 6% FIT
-GROSS SELLING PRICE or FMV

Based on NET CAPITAL GAIN

CAPITAL GAINs TAX
† Share of stock not traded in LSE
-Individual 15%
-DC 15%
-Non-resident FC 5% on the first 100,000
10% on the excess of the first
100,000
Based on ACTUAL AMOUNT
OPT
† OPT on overseas dispatch, message or conversation from PH to FC 10%
† OPT on life insurance premiums 2%
† OPT on agents of foreign insurance company (fire, marine or
miscellaneous insurance) 4%
† OPT on owners of property who directly obtain insurance with
Foreign insurance companies 5%
† OPT on winnings
-winning ticket (less cost of ticket) 10%
-winning from double, forecast/quinella and trifecta bets 4%
-prize of winning race horse owners 10%
Based on GROSS SELLING PRICE
OPT
† Shares of stocks listed and traded in LSE 6/10 of 1% or 0.006
† Shares of stocks through public offering
-up to 25% of total outstanding shares 4%
-over 25% but not over 33 1/3% 2%
-over 33 1/3% 1%