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    Corporate Income Tax: Regular Corporation

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    loonie tunes
    This document outlines various corporate income tax schemes and requirements for regular corporations in the Philippines, including: 1. Domestic and resident corporations are subject to either the regular corporate income tax or 15% gross income tax, subject to certain requisites and cost ratio limits. 2. All corporations are subject to a minimum corporate income tax of 2% of gross income if their regular corporate tax is zero or negative, or if the minimum tax is greater than the regular tax. 3. A branch profit remittance tax of 15% applies to profits remitted abroad by foreign corporations operating in the Philippines, with some exemptions.

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    Corporate Income Tax: Regular Corporation

    Uploaded by

    loonie tunes
    37 views2 pages
    This document outlines various corporate income tax schemes and requirements for regular corporations in the Philippines, including: 1. Domestic and resident corporations are subject to either the regular corporate income tax or 15% gross income tax, subject to certain requisites and cost ratio limits. 2. All corporations are subject to a minimum corporate income tax of 2% of gross income if their regular corporate tax is zero or negative, or if the minimum tax is greater than the regular tax. 3. A branch profit remittance tax of 15% applies to profits remitted abroad by foreign corporations operating in the Philippines, with some exemptions.

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    Corporate Income Tax

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    Corporate Income Tax

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    This document outlines various corporate income tax schemes and requirements for regular corporations in the Philippines, including: 1. Domestic and resident corporations are subject to either the regular corporate income tax or 15% gross income tax, subject to certain requisites and cost ratio limits. 2. All corporations are subject to a minimum corporate income tax of 2% of gross income if their regular corporate tax is zero or negative, or if the minimum tax is greater than the regular tax. 3. A branch profit remittance tax of 15% applies to profits remitted abroad by foreign corporations operating in the Philippines, with some exemptions.

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    © All Rights Reserved
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    Download as docx, pdf, or txt
    37 views2 pages

    Corporate Income Tax: Regular Corporation

    Uploaded by

    loonie tunes
    This document outlines various corporate income tax schemes and requirements for regular corporations in the Philippines, including: 1. Domestic and resident corporations are subject to either the regular corporate income tax or 15% gross income tax, subject to certain requisites and cost ratio limits. 2. All corporations are subject to a minimum corporate income tax of 2% of gross income if their regular corporate tax is zero or negative, or if the minimum tax is greater than the regular tax. 3. A branch profit remittance tax of 15% applies to profits remitted abroad by foreign corporations operating in the Philippines, with some exemptions.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    of 2

    CORPORATE INCOME TAX: REGULAR CORPORATION

     Corporate Tax Scheme on Regular Corporation

    Domestic Corporation Gross Income Tax or Regular Corporate Tax subject to the Minimum
    Corporate Income Tax
    Resident Corporation Regular Corporate Tax subject to the Minimum Corporate Income
    Tax

    Requisites of applying 15% Gross Income Tax:


    i. Tax effort ratio of 20% of Gross National Product
    ii. Ratio of 40% of income tax collection to total tax revenue
    iii. A VAT tax effort of 4% of Gross National Product
    iv. A 0.9% ratio if the Consolidated Public Sector Financial Position to GNP

     15% Gross income Tax is only applicable to firms whose cost ratio does not exceed 55%
     Election of Gross Income Tax shall be irrevocable for 3 consecutive taxable years.

     Minimum Corporate Income Tax

    Corporations are subject to a minimum corporate income tax of 2% of gross income; if

    a. The corporation has zero or negative taxable income; or


    b. MCIT is greater than the regular corporate income tax.

     Scope of Minimum Corporate Income Tax


    All corporations subject to 30% regular corporate income tax including non-profit, exempt and
    Special Corporation may be subject to MCIT.

     Timing of Imposition of MCIT


    MCIT is imposed beginning on the fourth taxable year immediately following the year in which
    such corporation commenced its operation

     What is the Gross Income for the purpose of MCIT


    For Corporation Involved in: Gross Income means
    1. Sale of Goods Goss sales less Sales Return, Discounts and
    Allowances and Cost of Goods Sold
    2. Sale of Service Gross Receipt less Sales Return, Discounts and
    Allowances and Cost of Service

     Excess MCIT Carry-over


    Excess of MCIT over RCIT can be claim as a tax credit against RCIT due in the immediately
    succeeding three years.
     Improperly Accumulated Earnings Tax
    10% of Accounting Income after Taxes

     IAET Exempt Entities


    1. Publicly – held corporations
    2. Finance Companies
    3. Banks
    4. Insurance Companies
    5. Taxable Partnership
    6. General Professional Partnerships
    7. Taxable and Non-taxable Joint Venture
    8. ECOZONE- registered entities (PEZA, BCDA, etc.)

     Branch Profit Remittance Tax

    15% final tax based on total profits applied or earmarked for remittance. Remitted Income
    which is subject to final tax is no longer taxed by Branch Profit Remittance Tax.

     Scope of Branch Profit Remittance Tax


    It applies to all remittances of all resident Foreign Corporation including ROHQ of multinational
    companies, FCDU or OBU and international carriers, except PEZA-registered entities.

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