Chapter 5 Flashcards
Can you apply final withholding tax on passive income earned without the Philippines?
No. It is inherently territorial
What is the general tax rate of NRA-NETBs and NRFCs?
25%
Short term local currency deposits from banks to individuals have a final tax rate of?
20%
Long term local currency deposits from banks to individuals have a final tax rate of?
None
Short term local currency deposits from banks to corporations have a final tax rate of?
20%
Long term local currency deposits from banks to corporations have a final tax rate of?
20%
Any local currency deposits from non-banks to individuals or corporations have a final tax rate of?
None. It is subject to regular income
This is an alternative form of obtaining funds from the public other than deposits through the issuance, endorsement, or acceptance of debt instruments for the borrowers own account.
Deposite substitute
Does the 19 lender rule apply to government securities?
No
This states that in order for an instrument to be a deposit substitute in needs to have at least 20 individuals or corporate lenders at any one time.
19 lender rule
When is tax withheld for interest-bearing instruments or securities?
Upon payment of interest
When is final tax withheld for zero coupon instruments or services?
Upon origination
What is the final tax rate of short term deposit substitutes issued by banks to individuals?
20%
What is the final tax rate of short term deposit substitutes issued by banks to corporations?
20%
What is the final tax rate of long term deposit substitutes issued by banks to individuals?
None
What is the final tax rate of long term deposit substitutes issued by banks to corporations?
20%
What is the final tax rate of short term deposit substitutes issued by non-banks to individuals?
20%
What is the final tax rate of short term deposit substitutes issued by non-banks to individuals?
20%
What is the final tax rate of short term deposit substitutes issued by non-banks to corporations?
20%
What is the final tax rate of long term deposit substitutes issued by non-banks to corporations?
None. It is subject to regular income tax
If long term deposits are pre-terminated upon holding period of less than 3 years, how much is the final tax rate?
20%
If long term deposits are pre-terminated upon holding period of 3 to 4 years, how much is the final tax rate?
12%
If long term deposits are pre-terminated upon holding period of 4 to 5 years, how much is the final tax rate?
5%
If long term deposits are pre-terminated upon holding period of more than 5 years, how much is the final tax rate?
None.
What is the final tax rate of foreign currency deposits on resident citizens and resident corporations?
Both 15%
What is the final tax rate of foreign currency deposits on non-resident citizens and non-resident corporations?
None
What is the final tax rate of foreign currency deposits on resident citizens and resident corporations if the bank account where the funds are deposited is jointly owned by a resident citizen and a nonresident?
The 1/2 portion of the foreign currency deposit is taxable with the 15% final tax rate for foreign currency deposits.
This is any distribution made by a corporation to its shareholders out of its earnings or profits and payable to its shareholders.
Dividends
These are dividends paid in cash.
Cash dividends
These are dividends paid in non-cash properties.
Property dividends
These are dividends paid in notes or evidence of indebtedness of the corporation.
Scrip dividends
These are dividends paid in the stocks of the corporation.
Stock dividends
These are distribution of corporate nets assets to shareholders.
Liquidating dividends
Are stock dividends and liquidating dividends taxable on income?
No because stock dividends are unrealized and liquidating dividends are just a return of capital.
Is a stock split subject to income tax?
Never
What is the final tax rate of dividends given to individuals by domestic corporations?
10%
What is the final tax rate of dividends given to individuals or corporations by foreign corporations?
None. It is subject to regular tax
What is the final tax rate of dividends given to corporations by domestic corporations?
None
What is the final tax rate of dividends given to NRA-ETBs by domestic corporations?
20%
Are qualified foreign-sourced dividends taxable on final tax?
No
Are dividends from cooperatives taxable on final tax?
No they are exempt
Are inter-corporate dividends from domestic corporations taxable on final tax?
No they are exempt
Are dividends from OPCs taxable o final tax?
Yes
Are dividends from real estate investment trusts taxable on final tax?
Yes
Are dividends form incorporated joint ventures taxable on final tax?
Yes
This is a publicly l listed corporation established principally for the purpose of owning income-generating real estate assets.
Real estate investment trust or REIT
Passive royalty income from books, literary works, and musical compositions have a final tax on individuals of?
10%
Passive royalty income from books, literary works, and musical compositions have a final tax on corporations of?
20%
Passive royalty income from other sources have a final tax on individuals of?
20%
Passive royalty income from other sources have a final tax on corporations of?
20%
Passive royalty income from books, literary works, and musical compositions sold on e-copies or CDS have a final tax of?
20%
What kind of prizes are exempt from tax?
Those that are received without any effort on the part of the recipient
Those from sport competitions that are sanctioned by their national sport organizations
What are the requisites of being exempt from final tax on prizes?
The recipient must be selected without any action on their part to enter the contest
The recipient is not required to render substantial future services as a condition to receiving the prize or reward
For prizes exceeding P10,000, what is the final tax rate on individuals and corporations?
20% - individuals
RIT - corporations
For prizes not exceeding P10,000, what is the final tax rate on individuals and corporations?
RIT for both
For PCSO winnings not exceeding P10,000, what is the final tax rate on individuals and corporations?
Both are exempt
For PCSO winnings exceeding P10,000, what is the final tax rate on individuals and corporations?
20% for both
For other winnings, what is the final tax rate on individuals and corporations?
20% - individual
RIT - corporation
What is the reward of a tax informer?
The lower of:
1,000,000; and
10% of revenues, surcharges, or fees recovered and or fine or penalty imposed or collected
What is the final tax rate of an informer’s reward?
10%
Read requisites of tax informers reward.
Interest income with tax-free or tax-reduction provision where the obligor shoulders in whole or in part any tax on the interest shall be subject to a final withholding tax of?
30%
The included all remunerations under an employer-employee relationship that do not form any part of compensation income.
Fringe benefits
When is the deadline of monthly filing of withholding final tax?
on or before the 10th day of the month following the month in which the withholding was made
Who are exempt from final income tax?
International missions with tax immunity
FG and FGOC
General professional partnership
qualified employee trust fund
Personal equity retirement account fund
