Tax Rate

A. For Individuals Earning Purely Compensation Income and Individuals Engaged in

Business and Practice of Profession
Amount of Net Taxable Income
Over
But Not Over
P10,000
P10,000
P30,000
P30,000
P70,000
P70,000
P140,000
P140,000
P250,000
P250,000
P500,000
P500,000

Rate
5%
P500 + 10% of the Excess over P10,000
P2,500 + 15% of the Excess over P30,000
P8,500 + 20% of the Excess over P70,000
P22,500 + 25% of the Excess over P140,000
P50,000 + 30% of the Excess over P250,000
P125,000 + 32% of the Excess over P500,000 in 2000 and onward

Note: When the tax due exceeds P2,000.00, the taxpayer may elect to pay in two equal
installments, the first installment to be paid at the time the return is filed and the second
installment 15 of the same year at on or before July the Authorized Agent Bank (AAB) within
the jurisdiction of the Revenue District Office (RDO) where the taxpayer is registered.
Passive Income
1. Interest from currency deposits, trust funds and deposit substitutes
2. Royalties (on books as well as literary & musical composition)
- In general
3. Prizes (P10,000 or less )
- In excess of P10,000
4. Winnings (except from PCSO and lotto)
5. Interest Income of Foreign Currency Deposit
6. Cash and Property Dividends
- To individuals from Domestic Corporations
- To Domestic Corporations from Another Domestic Corporations
7. On capital gains presumed to have been realized from sale, exchange or other disposition
of real property (capital asset)
8. On capital gains for shares of stock not traded in the stock exchange
- Not over P100,000
- Any amount in excess of P100,000
9. Interest Income from long-term deposit or investment in the form of savings, common or
individual trust funds, deposit substitutes, investment management accounts and other
investments evidenced by certificates
Upon pretermination before the fifth year , there should be imposed on the entire income from
the proceeds of the long-term deposit based on the remaining maturity thereof:
Holding Period
- Four (4) years to less than five (5) years
- Three (3) years to less than four (4) years
- Less than three (3) years

B. For Non-Resident Aliens Engaged in Trade or Business

1. Interest from currency deposits, trust funds and deposit substitutes
20%
2. Interest Income from long-term deposit or investment in the form of savings, common or
individual trust funds, deposit substitutes, investment management accounts and other
investments evidenced by certificatesUpon pretermination before the fifth year, there should Exempt
be imposed on the entire income from the proceeds of the long-term deposit based on the
remaining maturity thereof:Holding Period:
-Four (4) years to less than five (5) years
5%
-Three (3) years to less than four (4) years
12%
-Less than three (3) years
20%
3. On capital gains presumed to have been realized from the sale, exchange or other
6%
disposition of real property

20%
10%
20%
5%
20%
20%
7.5%
10 %
0%
6%
5%
10%

Exempt

5%
12%
20%

4. On capital gains for shares of stock not traded in the Stock Exchange
- Not over P100,000
- Any amount in excess of P100,000

5%
10%

C) For Non-Resident Aliens Not Engaged in Trade or Business

1. On the gross amount of income derived from all sources within the Philippines
25%
2. On capital gains presumed to have been realized from the exchange or other disposition of
6%
real property located in the Phils.
3. On capital gains for shares of stock not traded in the Stock Exchange
- Not Over P100,000
5%
- Any amount in excess of P100,000
10%

D) On the gross income in the Philippines of Aliens Employed by Regional Headquarters

(RHQ) or Area Headquarters and Regional Operating Headquarters (ROH), Offshore
Banking Units (OBUs), Petroleum Service Contractor and Subcontractor
On the gross income in the Philippines of Aliens Employed by Regional Headquarters (RHQ)
or Area Headquarters and Regional Operating Headquarters (ROH), Offshore Banking Units
(OBUs), Petroleum Service Contractor and Subcontractor

15%