Kinds of Taxpayers

Kinds of Taxpayers
Individuals
CITIZENS
Resident Non-resident
 one who permanently stayed in the Ph  one who leaves the PH during the taxable year
 one who stayed outside Ph less than 183 days to reside abroad, either as an immigrant or for
employment on a permanent basis
 one who stayed outside the Ph for at least 183
Taxable on all sources within and without days
 one who works and derives income from abroad
and whose employment thereat requires him to
be physically present abroad most of the time
during the taxable year
Taxable on sources within Ph
ALIENS
Resident Non-resident alien
 alien who stays within the Ph continuously for a NRA-ETB (engaged in trade or business)
period of 1 year from date of arrival  stays for more than 180 days from date of
arrival in PH
NRA-NETB (not engaged in trade or business)

 stays for less than 180 days
Taxability of aliens, whether resident or non-resident, will still be sources within the PH.
Corporations
Domestic Foreign
- Those created under Philippine laws. - Resident Foreign Corporation (if licensed to
engage trade or business in the Ph)
- Non-resident Foreign Corporation (no license)
Taxable on all sources within and without Whether resident or non-resident, foreign corporations
are taxable only on sources within the Ph.
Minimum Wage Earner
 a worker in the private sector paid the statutory minimum wage, or

 an employee in the public sector with compensation income of not more than the statutory minimum wage in
the non-agricultural sector where he/she is assigned
Types of individual taxpayers
Taxpayer Compensation Income Business or Practice of Profession
(1) Compensation Incomer Schedular rates of 0% - 35% Not applicable

Earner (based on the tax table)
(2) Purely Self-employed or Not applicable 1.) NOT VAT-registered AND gross
Professionals sales or receipts DO NOT exceed
3M (not subject to vat):
a. Schedular rates of 0% - 35%

AND other percentage taxes
or
b. 8% rate with 250K deduction
2.) VAT-registered OR gross sales or

receipts exceed 3M (subject to vat):
a. Schedular rates of 0% - 35%
AND
b. 12% vat
(3) Mixed Income Earner 1. For compensation income:
Schedular rates of 0% - 35%

(based on the tax table)
AND
2. For business income or practice of profession
a. If not subject to vat:

 Schedular tax rates of 0% - 35%
or
 8% rate without 250K deduction
b. If subject to vat:
 Schedular rates of 0% - 35%
AND
 12% vat
(taxation on corporate income, TSN page 29)

SUBSTITUTED FILING
An individual taxpayer will no longer have to personally file his own Income Tax Return but instead the employer's
Annual Information Return on Income Taxes Withheld filed will be considered as the "substitute" ITR of the employee.
REQUISITES FOR INDIVIDUALS QUALIFIED FOR SUBSTITUTED FILING OF BIR FORM NO. 1700
1. Receives purely compensation income regardless of amount;
2. Compensation from only one employer in the Philippines for the calendar year;
3. Income tax has been withheld correctly by the employer (tax due equals tax withheld);
4. the employee's spouse also complies with all the three conditions stated above;
5. Employer files the BIR Form No. 1604-C; and
6. The employer issues each employee BIR Form No. 2316 (latest version)
NOTE:
All the above requisites must be present. The annual Information Return of Income Taxes Withheld on Compensation
(BIR Form No. 1604-C) filed by their respective employers filed their respective employers duly submitted to the
eSubmission facility of the BIR.
REQUISITES FOR INDIVIDUALS NOT QUALIFIED FOR SUBSTITUTED FILING OF BIR FORM NO. 1700
1. Individuals with two or more employers concurrently and/or successively at anytime during the taxable year.
2. Employees whose income tax have not been withheld correctly resulting to collectible or refundable return.
3. Individuals deriving other non-business, non-profession-related income in addition to compensation income

not otherwise subject to final tax.
4. Individuals receiving purely compensation income from a single employer whose income tax has been
correctly withheld but whose spouse does not qualify tor substituted filing.
5. Non-resident aliens engaged in trade or business in the Philippines deriving purely compensation income or
compensation income and other non-related business, non-profession-related income.

Kinds of Taxpayers

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Kinds of Taxpayers

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Kinds of Taxpayers

Taxable on sources within Ph

Resident Non-resident alien

NRA-NETB (not engaged in trade or business)

- Non-resident Foreign Corporation (no license)

Minimum Wage Earner

 a worker in the private sector paid the statutory minimum wage, or

Taxpayer Compensation Income Business or Practice of Profession

(1) Compensation Incomer Schedular rates of 0% - 35% Not applicable

a. Schedular rates of 0% - 35%

b. 8% rate with 250K deduction

2.) VAT-registered OR gross sales or

a. Schedular rates of 0% - 35%

(3) Mixed Income Earner 1. For compensation income:

Schedular rates of 0% - 35%

2. For business income or practice of profession

a. If not subject to vat:

 8% rate without 250K deduction

(taxation on corporate income, TSN page 29)

1. Receives purely compensation income regardless of amount;

5. Employer files the BIR Form No. 1604-C; and

3. Individuals deriving other non-business, non-profession-related income in addition to compensation income

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