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    Passive Income Tax Base Tax Rate

    Uploaded by

    Bianca Deslate
    This document outlines tax rates for different types of passive income earned by residents (RC, NRC) and non-residents (RA, NRA) of the Philippines. It shows that interest income, dividends, royalties, rents and prizes are subject to final withholding taxes (FT) that range from 5-32% depending on residence status and income type. Certain types of interest income earned from long-term deposits, foreign currency transactions, and agricultural tenants are exempt from tax.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    Passive Income Tax Base Tax Rate

    Uploaded by

    Bianca Deslate
    57 views2 pages
    This document outlines tax rates for different types of passive income earned by residents (RC, NRC) and non-residents (RA, NRA) of the Philippines. It shows that interest income, dividends, royalties, rents and prizes are subject to final withholding taxes (FT) that range from 5-32% depending on residence status and income type. Certain types of interest income earned from long-term deposits, foreign currency transactions, and agricultural tenants are exempt from tax.

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    by Deslate, Bianca

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    This document outlines tax rates for different types of passive income earned by residents (RC, NRC) and non-residents (RA, NRA) of the Philippines. It shows that interest income, dividends, royalties, rents and prizes are subject to final withholding taxes (FT) that range from 5-32% depending on residence status and income type. Certain types of interest income earned from long-term deposits, foreign currency transactions, and agricultural tenants are exempt from tax.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    57 views2 pages

    Passive Income Tax Base Tax Rate

    Uploaded by

    Bianca Deslate
    This document outlines tax rates for different types of passive income earned by residents (RC, NRC) and non-residents (RA, NRA) of the Philippines. It shows that interest income, dividends, royalties, rents and prizes are subject to final withholding taxes (FT) that range from 5-32% depending on residence status and income type. Certain types of interest income earned from long-term deposits, foreign currency transactions, and agricultural tenants are exempt from tax.

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    TAXED ON

    Gains from dealings in property


    Gain from sale of ORDINARY
    ASSETS
    Passive investment income
    Interest Income
    Currency bank deposit & yield,
    monetary benefit from deposit
    substitutes, trust funds, etc
    From foreign currency deposits
    w/ offshore banking unit (OBU)
    or foreign currency deposit unit
    (FCDU) in the Philippines
    Long term deposit/investment
    [savings, trust funds, deposit
    substitutes, investments]
    Pre-terminated long term
    investment (should actually be
    based on expired term)
    Interest income of a depository
    bank (under the expanded
    foreign currency system);
    foreign currency transactions w/
    non-residents, OBU's in the
    Phils, local commercial banks
    including branches of foreign
    banks authorized by BSP to
    transact business w/ foreign
    currency deposit system
    Interest income of depository
    banks (under the expanded
    foreign currency system) from
    foreign currency loans to
    residents other than OBU's in
    the Phils. or other depository
    banks under the expanded
    system
    Other interest income derived
    from the Philippines
    (between individuals)
    Other interest income derived
    from outside the Philippines
    - tenant who paid to a
    landowner under CARP
    - from a duly registered
    cooperative
    BSP prescribed form of

    DESLATE 1

    RC

    NRC

    RA

    NRAETB

    NRANETB

    5-32%

    DC

    RFC

    NRFC

    30%

    20% FT

    20% FT

    20% FT

    20% FT

    25% FT

    20% FT

    20% FT

    30%

    7.5% FT

    EXEMPT

    7.5% FT

    EXEMPT

    EXEMPT

    7.5% FT

    7.5% FT

    EXEMPT

    EXEMPT

    EXEMPT

    EXEMPT

    EXEMPT

    EXEMPT

    EXEMPT

    N/A

    10% FT

    10% FT

    20% FT on foreign
    loans contracted after
    Aug. 1, 1988

    25% FT
    5% FT (4 to <5 yrs)
    12% FT (3 to <4 yrs)
    20% FT (< 3 yrs)

    5% FT (4 to <5 yrs)
    12% FT (3 to <4 yrs)
    20% FT (< 3 yrs)

    5% FT (4 to <5 yrs)
    12% FT (3 to <4 yrs)
    20% FT (< 3 yrs)

    5% FT (4 to <5 yrs)
    12% FT (3 to <4 yrs)
    20% FT (< 3 yrs)

    25% FT

    5-32%

    5-32%

    5-32%

    5-32%

    25% FT

    5-32%

    EXEMPT

    EXEMPT

    EXEMPT

    EXEMPT

    EXEMPT
    EXEMPT
    EXEMPT

    investments maturing more


    than five years
    Expanded foreign currency
    deposit system by non-resident
    citizens/aliens
    Dividend income
    Cash/property dividends (FMV
    amt) from domestic corp
    OR
    Share in distributable net
    income after tax of a
    partnership, assoc, joint acct,
    joint venture, or consortium
    taxable as a corp
    Cash/property dividends from a
    foreign corp. doing business
    in Phils.
    " " foreign corp outside Phils.
    Royalties
    Passive income
    Paid by a domestic corp. to
    [on books, literary works,
    musical compositions]
    [cinematographic films]
    - for non-resident
    cinematographic film owner,
    lessor, distributor (28 B (2) )
    Paid by a foreign corp. to
    Rent
    Prizes
    Within Philippines
    > P10,000
    < P10,000
    Outside Philippines

    EXEMPT

    10% FT

    10% FT

    20% FT

    25% FT

    EXEMPT

    EXEMPT

    15% FWT1

    - inter-corporate dividends are exempt from tax


    - but once declared to its SH, they have to pay
    taxes on them

    5- 32% FT

    5-32% FT

    5-32% FT

    5-32% FT

    25% FT

    30% FT

    5-32% FT

    EXEMPT

    EXEMPT

    EXEMPT

    EXEMPT

    30% FT

    EXEMPT

    EXEMPT

    20% FT
    10% FT

    20% FT
    10% FT

    20% FT
    10% FT

    20% FT
    10% FT

    25% FT
    25% FT

    20% FT

    20% FT

    30% FT

    20% FT

    25% FT

    25% FT

    ??

    30%

    30% FT
    ??

    30% FT
    ??

    5-32%
    5-32%

    EXEMPT
    5-32%

    EXEMPT
    5-32%

    EXEMPT
    25% FT

    EXEMPT
    25% FT

    30% FT
    ??

    20& FT
    5-32% FT
    5-32%

    20% FT
    5-32% FT
    5-32% FT

    20% FT
    5-32% FT
    EXEMPT

    20% FT
    5-32% FT
    EXEMPT

    25% FT
    25% FT
    EXEMPT

    30% FT
    ??
    EXEMPT

    Sec. 28 (5b): condition is that of tax credit

    DESLATE 2

    10% FT

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