TAXATION GARCIA/TAMAYO

TX-602: Corporation (Income Tax Rates)

1. TAX RATES
a. In general
Tax rate Sec. 27 (A) DOMESTIC Sec. 28 (A) (1) Sec. 28 (B) (1)
NONRESIDENT FC NONRESIDENT FC
35% - 35% - 35% -
November November November
1,2005 to 1,2005 to 1,2005 to
December 31, December 31, December 31,
2008 30% - 2008 30% - 2008 30% -
January 10009) January 10009) January 10009)

Tax base Net income within and Net income within Gross income within
without

b. Optional corporate tax

Sec. 27 (A) DOMESTIC Sec. 28 (A) (1) NONRESIDENT FC
NONRESIDENT FC
Tax rate 15% 15%
Tax base Gross income Gross income

c. Minimum corporate income tax

Sec. 27 (E) DOMESTIC NONRESIDENT FC
Sec, 28 (A) (2)
RESIDENT FC

2% of gross income 2% of gross income

within and without within

d. On certain passive income derived from the Philippines sources

DC and RFC Sec. 27 NRFC Sec.
(D) Sec.28 (A) (7) 28(B)(1)
Interest in any currency bank deposit 20% final tax 30% final tax
20% final tax 30% final tax
Yield or any monetary benefit from deposit substitute
Yield or any monetary benefit from trust fund and other similar 20% final tax 30% final tax
arrangements
Royalties 20% final tax 30% final tax
Interest income derived from depository bank under EFCDS 7 ½% final tax Exempt
e. Capital gains taxes
Corporation Tax base Tax rate
1. Capital gains from Domestic corporation Net capital gain 5% - First P100,000
sale of shares of Sec. 27 (D) (5) 10% - Amount in
stock snot traded/in excess of P1000, 000
the local stock
exchange
2. Capital gains from
sale, barter, transfer Resident foreign 5% - First P100,000
and/or assignment corporation Net capital gain 10% - Amount in
of shares of stock of Sec. 28 (A), (5) (c) excess of P1000, 000
publicly-listed
companies, not
complaint with
mandatory
minimum public
ownership (10% of
the publicly listed
companies' issued
and outstanding
shares, exclusive of
any treasury shares)
(RR No. 18- 2012)

Resident foreign 5% - First P100,000

corporation Net capital gain 10% - Amount in
Sec. 28 (A), (7) (c) excess of P1000, 000
3. Gains realized from Domestic corporation Capital asset - on
sale or exchange or Sec. 27 (D) (5) gross selling price or 6% final tax
disposition of land fair market value
and/or building whichever is higher
Ordinary asset (not
habitually engaged in 6% creditable
real estate business) withholding tax
on selling price