RA 8424: Title III, Chapter II – Compliance Requirements

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TITLE IV – VALUE ADDED TAX, CHAPTER II – Compliance Requirements SEC. 113. Invoicing and Accounting Requirements for VAT-registered Persons. – (A) Invoicing Requirements. – A VAT-registered person shall issue a VAT invoice for every sale, barter, exchange, or lease of goods or properties and for every sale, barter or exchange of services. (B) Information Contained in the VAT Invoice. – The following information shall be indicated in the VAT invoice: (C) Accounting Requirements. – Notwithstanding the provisions of Section 233, all persons subject to the value-added tax under Sections 106 and 108 shall, in addition to the regular accounting records required, maintain a subsidiary sales journal and subsidiary purchase journal on which the daily sales and purchases are recorded. The subsidiary journals shall contain such information as may be required by the Secretary of Finance. (D)  Consequence of Issuing Erroneous VAT Invoice. – (1)  If a person who is not a VAT-registered person issues

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RA 8424: Title IV, Chapter I – Imposition of Tax

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TITLE IV – VALUE ADDED TAX, CHAPTER I – Imposition of Tax SECTION 105. Persons Liable. – Any person who, in the course of trade or business, sells, barters, exchanges, leases goods or properties, renders services, and any person who imports goods shall be subject to the value-added tax (VAT) imposed in Sections 106 to 108 of this Code. The value-added tax is an indirect tax and the amount of tax may be shifted or passed on to the buyer, transferee or lessee of the goods, properties or services. This rule shall likewise apply to existing contracts of sale or lease of goods, properties or services at the time of the effectivity of Republic Act No. 7716. The phrase ‘in the course of trade or business‘ means the regular conduct or pursuit of a commercial or an economic activity, including transactions incidental thereto, by any person regardless of whether or

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RA 8424: Title III, Chapter II – Donor’s Tax

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TITLE III – ESTATE & DONOR’S TAX, CHAPTER II – Donor’s Tax SECTION 98.  Imposition of Tax. – (A) There shall be levied, assessed, collected and paid upon the transfer by any person, resident or nonresident, of the property by gift, a tax, computed as provided in Section 99. (B) The tax shall apply whether the transfer is in trust or otherwise, whether the gift is direct or indirect, and whether the property is real or personal, tangible or intangible. SEC. 99. Rate of Tax Payable by Donor. – (A) In General. – The tax for each calendar year shall be six percent (6%) computed on the basis of the total gifts in excess of Two hundred fifty thousand pesos (P250,000) exempt gift made during the calendar year. (As amended by RA No. 10963 (December 19, 2017)). (B) Any contribution in cash or in kind to any candidate, political party or coalition of

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RA 8424: Title II, Chapter XIII – Withholding on Wages

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Title II – Income Taxation, CHAPTER XIII – Withholding on Wages SECTION 78. Definitions. – As used in this Chapter: (A) Wages. – The term ‘wages‘ means all remuneration (other than fees paid to a public official) for services performed by an employee for his employer, including the cash value of all remuneration paid in any medium other than cash, except that such term shall not include remuneration paid: (1) For agricultural labor paid entirely in products of the farm where the labor is performed, or (2) For domestic service in a private home, or (3) For casual labor not in the course of the employer’s trade or business, or (4) For services by a citizen or resident of the Philippines for a foreign government or an international organization. If the remuneration paid by an employer to an employee for services performed during one-half (1⁄2) or more of any payroll period of

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RA 8424: Title III, Chapter I – Estate Tax

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TITLE III – ESTATE & DONOR’S TAX, CHAPTER I – Estate Tax SEC. 84. Rate of Estate Tax. – There shall be levied, assessed, collected and paid upon the transfer of the net estate as determined in accordance with Sections 85 and 86 of every decedent, whether resident or nonresident of the Philippines, a tax at the rate of six percent (6%) based on the value of such net estate. (As amended by RA No. 10963 (December 19, 2017)). SECTION 85.  Gross Estate. – The value of the gross estate of the decedent shall be determined by including the value at the time of his death of all property, real or personal, tangible or intangible, wherever situated: Provided, however, That in the case of a nonresident decedent who at the time of his death was not a citizen of the Philippines, only that part of the entire gross estate which

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RA 8424: Title II, Chapter XII – Quarterly Corporate Income Tax Annual Declaration and Quarterly Payments of Income Taxes

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Title II – Income Taxation, CHAPTER XII – Quarterly Corporate Income Tax Annual Declaration and Quarterly Payments of Income Taxes SECTION 74. Declaration of Income Tax for Individuals. – (A) In General. – Except as otherwise provided in this Section, every individual subject to income tax under Sections 24 and 25(A) of this Title, who is receiving self-employment income, whether it constitutes the sole source of his income or in combination with salaries, wages, and other fixed or determinable income, shall make and file a declaration of his estimated income for the current taxable year on or before May 15 of the same taxable year. In general, self-employment income consists of the earnings derived by the individual from the practice of profession or conduct of trade or business carried on by him as a sole proprietor or by a partnership of which he is a member.  Nonresident Filipino citizens, with respect

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RA 8424: Title II, Chapter XI – Other Income Tax Requirements

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Title II – Income Taxation, CHAPTER XI – Other Income Tax Requirements SECTION 67. Collection of Foreign Payments. – All persons, corporations, duly registered general co-partnerships (companias colectivas) undertaking for profit or otherwise the collection of foreign payments of interests or dividends by means of coupons, checks or bills of exchange shall obtain a license from the Commissioner, and shall be subject to such rules and regulations enabling the government to obtain the information required under this Title, as the Secretary of Finance, upon recommendation of the Commissioner, shall prescribe. SECTION 68. Information at Source as to Income Payments. – All persons, corporations or duly registered co-partnerships (companias colectivas), in whatever capacity acting, including lessees or mortgagors of real or personal property, trustees, acting in any trust capacity, executors, administrators, receivers, conservators and employees making payment to another person, corporation or duly registered general co-partnership (compania colectiva), of interests, rents,

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RA 8424: Title II, Chapter X – Estates and Trusts

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Title II – Income Taxation, CHAPTER X – Estates and Trusts SECTION 60. Imposition of Tax. – (A) Application of Tax. – The tax imposed by this Title upon individuals shall apply to the income of estates or of any kind of property held in trust, including: (1) Income accumulated in trust for the benefit of unborn or unascertained person or persons with contingent interests, and income accumulated or held for future distribution under the terms of the will or trust; (2) Income which is to be distributed currently by the fiduciary to the beneficiaries, and income collected by a guardian of an infant which is to be held or distributed as the court may direct; (3) Income received by estates of deceased persons during the period of administration or settlement of the estate; and (4) Income which, in the discretion of the fiduciary, may be either distributed to the beneficiaries or accumulated.

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RA 8424: Title II, Chapter IX – Returns and Payment of Tax

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Title II – Income Taxation, CHAPTER IX – Returns and Payment of Tax SECTION 51.  Individual Return. – (A)       Requirements. – (1)        Except as provided in paragraph (2) of this Subsection, the following individuals are required to file an income tax return: (2)        The following individuals shall not be required to file an income tax return: (3)        The foregoing notwithstanding, any individual not required to file an income tax return may nevertheless be required to file an information return pursuant to rules and regulations prescribed by the Secretary of Finance, upon recommendation of the Commissioner. (4)        The income tax return shall be filed in duplicate by the following persons: (5)        The income tax return (ITR) shall consist of a maximum of four (4) pages in paper form or electronic form, and shall only contain the following information: (B)       Where to File. – Except in cases where the Commissioner otherwise permits,

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RA 8424: Title II, Chapter VIII – Accounting Periods and Methods of Accounting

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Title II – Income Taxation, CHAPTER VIII – Accounting Periods and Methods of Accounting SECTION 43.  General Rule. – The taxable income shall be computed upon the basis of the taxpayer’s annual accounting period (fiscal year or calendar year, as the case may be) in accordance with the method of accounting regularly employed in keeping the books of such taxpayer; but if no such method of accounting has been so employed, or if the method employed does not clearly reflect the income, the computation shall be made in accordance with such method as in the opinion of the Commissioner clearly reflects the income. If the taxpayer’s annual accounting period is other than a fiscal year, as defined in Section 22(Q), or if the taxpayer has no annual accounting period, or does not keep books, or if the taxpayer is an individual, the taxable income shall be computed on the basis

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