REGULAR INCOME TAX

INDIVIDUAL
Chapter XIV

Prepared by: Joelito Jr. C. Abdon

Mary Grace L. Lozada
PROGRESSIVE TAX RATE/ TAX TABLE

Revised by TRAIN Law

Personal Exemption repealed
Personal Exemptions
a. Head of the family
b. Qualified dependents
TAX PAYERS SUBJECT TO TAX TABLE
Citizen
Resident Citizen
Non-resident Citizen
Alien
Resident Alien
Non-resident Alien – ETB
Taxable estate
Taxable trust
CLASSIFICATIONS OF INDIVIDUALS
Pure Compensation Income Earner
Pure Business and Professional
Income Earner
Mixed Income Earner
PURE COMPENSATION INCOME EARNER

oCompensation Income subject to

withholding tax
oSubstituted Filing System under this system
the employees are not required to:
File ITR
Pay tax due directly to BIR
CONDITIONS FOR SUBSTITUTED FILING SYSTEM

Compensation Income Earner only

One Employer
Withheld tax is equal to Income tax due
Spouse must comply with requirement 1,2,& 3
Employer filed BIR Form 1604 CF
Employer issued BIR Form 2316
ANNUAL ADJUSTMENT RETURN
Concurrent Employment
Successive Employment
Employer Error
Income Tax Due Total Compensation Income tax table
(Total Withholding tax)
= Income tax payable /(refundable)
CONSOLIDATED INCOME TAX RETURN
Compensation Income Earner shall file:
BIR Form 1700- with Other Casual Income
BIR Form 1701- with Other casual Income and
Business/Profession Income or (mixed Income
Earner)
CONSOLIDATED INCOME TAX RETURN
Compensation Income Earner with other Casual
Income
Total Taxable Compensation Income
Other Income subject to Regular Tax

Taxable Income Tax Table Income Tax Due

(Tax Credits)
Income Tax Still Due
PURE BUSINESS AND PROFESSIONAL INCOME
EARNER
Required to file:
Three 1701Q (1st, 2nd and 3rd Quarter)
One 1701A (4th quarter or Annual ITR)

Computation (Cumulative Year-to-date)

(Particular’s Previous Quarters+ Current Quarter)
COMPUTATION PB/PIE
Particulars 1st Quarter 2nd Quarter 3rd Quarter Annual ITR

Gross Receipts A1 A1+A2 A1+A2+A3 A1+A2+A3+A4

Less: Cost Of sales (B1) (B1+B2) (B1+B2+B3) (B1+B2+B3+B4)

Gross Income Total

Less: Deduction (C1) (C1+C2) (C1+C2+C3) (C1+C2+C3+C4)

Taxable Net Income Total

COMPUTATION PB/PIE
Particulars 1st Quarter 2nd Quarter 3rd Quarter Annual ITR
(D1) (D2) (D3) (D4)
Income Tax Due
Refer To The Tax Table

Less: Tax Credit

CWT 1st Q to Current (E1) (E1+E2) (E1+E2+E3) (E1+E2+E3+E4)

Total F1 F2 F3 F4
Less:Estimated Tax Paid (F1) (F2) (F3)
Total
Tax Payable
MIXED INCOME EARNER
Business/ Professional Income- Reported
quarterly (1701 Qs and 1701 A)

Compensation Income
Annual Computation
Annual filing And payment
(1701-A) Consolidated ITR
8 PERCENT OPTION

 Business/Profesional Income subject to:

Progressive Tax- Tax table
General Percentage Tax- 3% Of Net Income
8% option
In lieu of Progressive Tax and General Percentage
Tax
8% of Gross Income
8 PERCENT OPTION

Benefits of opting 8%:

No Business Tax- 8% annually instead of RIT and GPT
quarterly
Lower Tax Rate
No Financial statement needed
For Non-Vat taxpayer only
Irrevocable for the whole taxable year unless:
Earner register as Vat taxpayer
Income Exceeded the threshold(3 000 000)
TAXABLE ESTATES
and
TRUSTS
 TAXABLE ESTATES
An estate is an INCOME TAXPAYER
if under :
JUDICIAL SETTLEMENT or
ADMINISTRATION

If not taxable to the HEIRS

 TAXABLE TRUSTS
A Trusts is an INCOME TAXPAYER if under :
IRREVOCABLE TRUST

If not taxable to the GRANTOR-TRUSTOR

 INCOME TAXABLE TO AN ESTATE/ TRUSTS UNDER NIRC

INCOME accumulated in trusts for the benefit of such a

person for future
INCOME which is to be distributed currently to the
beneficiaries
INCOME received by estates of deceased persons
INCOME which, may be either distributed to the
beneficiaries or accumulated
CONSOLIDATION OF TWO OR MORE TRUS
Multiple IRREVOCABLE trusts designated by the same
grantor for the benefit of the same beneficiary shall be
consolidated.
 EMPLOYEES TRUST FUNDS

Requisite of EXEMPTION of Employee’s Trust

Contributions are made to the trusts by the
employer
Under the trust instrument
Any amount actually distributed to any employee
 RETURN OF MARRIED TAXPAYERS

Married individuals shall file a return for

the taxable year computing
SEPARATELY their individual income tax.
 INCOME OF UNMARRIED MINORS FROM PROPERTY
RECEIVED FROM PARENTS

TAXABLE TO THE PARENTS EXCEPT:

The donor’s tax has been paid on such property.

The transfer of such property is exempt from donor’s tax.
 RETURN OF PERSONS UNDER DISABILITY

The return may be made by his duly

AUTHORIZED AGENT or REPRESENTANTIVE or
by the GUARDIAN charged with the care of his
person or property.
ATTACHMENT TO THE ANNUAL INCOME TAX RETURN

 WHEN AND WHERE TO FILE AND PAY TAX

1. For ELECTRONIC FILING and PAYMENT SYSTEM(eFPS) taxpayers:
On or before 15th day of April of each year.
2. For NON-ELECTRONIC FILING AND PAYMENT SYSTEM TAXPAYERS
On or before 15th day of April of each year.
To any AUTHORIZED AGENT BANKS
REVENUE COLLECTION OFFICER
3. For NON-RESIDENT TAXPAYERS
Shall be filed with the OFFICE OF THE COMMISIONER or
REVENUE DISTRICT OFFICE
INSTALLMENT PAYMENT OF THE REGULAR
INCOME TAX

Tax due IN EXCESS OF 2,000

1 installment paid at the time the
st

return is filed
2 installment is due on or before
nd

OCTOBER 15
 WHO SHALL FILE THE INCOME TAX
RETURN
1.RESIDENT CITIZEN engaged in trade or
business
2.RESIDENT ALIEN, NON-RESIDENT CITIZEN,
OR NON-RESIDENT ALIEN engaged in trade or
business
3.A TRUSTEE, GUARDIAN OF A MINOR
4.Individual engaged in trade or business
 WHO ARE NOT REQUIRED TO FILE INCOME
TAX RETURN

1. Minimum wage earners

2. Individual’s gross income does not exceed 250,000
3. Individual’s compensation income from one employer
does not exceed 60,000
4. Individuals subject to final withholding tax
5. Pure compensation earners under substituted filing
system