INCOME TAXATION: SPECIAL RULES

SPECIAL RATES FOR CERTAIN ALIEN INDIVIDUALS

Alien Employed by Regional or Area
15%
5% - 34%, 33%, 32% [regular tax rate]
Headquarters and Regional Operating
on gross
or
Headquarters of Multinational Companies income on
FT rate for any other income earned
[Sec 25 (C ) ]
salaries, wages,
from all other sources within the
annuities,
Philippines
compensation,
Alien Individual Employed by Offshore
remuneration
Banking Units [Sec 25 (D) ]
and other
emoluments
Alien Individual Employed by Petroleum
such as
Service Contractor and Subcontractor
honoraria and
[Sec 25(E) ]
allowances

SPECIAL RATES FOR CORPORATIONS

DOMESTIC CORPORATION
Proprietary Educational Institutions and
Hospitals

10%
35%

on taxable income
on entire taxable income, if total gross
income from unrealted trade, business,
or activity exceed 50% of total income

GOCC, Agencies and Instrumentalities

32%

same tax rate upon their taxable income

in a similar business, industry or activity

GSIS / SSS / PHIC / PCSO

Depository Banks

EXEMPT
10%

on interest income from foreign

currency transactions including interest
income from foreign loans

RESIDENT FOREIGN CORPORATION

International Air Carriers
International Shipping
Offshore Banking Units

2 1/2 %
2 1/2 %
10%

on Gross Philippine Billings

on Gross Philippine Billings
any interest income derived from foreign
currency loans granted to residents
other than offshore banking units or
local commercial banks, including local
branches of foreign banks that may be
authorized by the BSP to transact
business with offshore banking units

EXEMPT

Regional or Area Headquarters

Regional Operating Headquarters
NON RESIDENT FOREIGN
CORPORATION
Cinematographic Film Owner, Lessor or
Distributor
Owner or Lessor of Vessel Charted by
Philippine Nationals
Owner or Lessors of Aircraft, Machineries
and Other Equipment
Atty. Marissa O. Cabreros (Ateneo School of Law)

income derived by offshore banking

units authorized by the Bangko Sentral
ng Pilipinas (BSP), from foreign
currency transactions with
nonresidents, other offshore banking
units, local commercial banks, including
branches of foreign banks that may be
authorized by the Bangko Sentral ng
Pilipinas (BSP) to transact business
with offshore banking units

EXEMPT
10%

on taxable income

25%

on Gross Income

4.5%

on Gross Rentals

7.5%

on Gross Rentals
January 2010