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Taxation in the Philippines
The policy of taxation in the Philippines is governed chiefly by the Constitution of the Philippines and three Republic Acts.
Taxes imposed at the national level are collected by the Bureau of Internal Revenue (BIR), while those imposed at the local level (i.e., provincial, city, municipal, barangay) are collected by a local treasurer's office.
The taxes imposed by the national government of the Philippines include, but are not limited to:
Citizens of the Philippines and resident aliens must pay taxes for all income they have derived from various sources, which include, but are not limited to:
Individuals, including nonresident aliens, earning compensation income are taxed based only on the income tax schedule for individuals. On the other hand, self-employed individuals and professionals are taxed based on the income tax schedule for individuals, applicable percentage taxes, and value-added tax (VAT). However, if their gross sales (or gross receipts plus other non-operating income) does not exceed the VAT threshold, they have the option to be taxed either on the basis of the income tax schedule for individuals and the applicable percentage taxes, or just with a flat tax rate of 8% on their gross sales (or gross receipts plus other non-operating income).
Interest income from bank deposits, deposit substitutes, trust funds, and other similar products (except for its long-term variants) is taxed at the rate of 20%.
Royalties, except on books, literary works and musical compositions, are taxed at the rate of 10%.
Prizes and winnings from Philippine Charity Sweepstakes Office (PCSO) Lotto in excess of P10,000 (upon which individual prizes and winnings P10,000 or below are taxed on the basis of the income tax schedule for individuals) are taxed at the rate of 20%.
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Taxation in the Philippines
The policy of taxation in the Philippines is governed chiefly by the Constitution of the Philippines and three Republic Acts.
Taxes imposed at the national level are collected by the Bureau of Internal Revenue (BIR), while those imposed at the local level (i.e., provincial, city, municipal, barangay) are collected by a local treasurer's office.
The taxes imposed by the national government of the Philippines include, but are not limited to:
Citizens of the Philippines and resident aliens must pay taxes for all income they have derived from various sources, which include, but are not limited to:
Individuals, including nonresident aliens, earning compensation income are taxed based only on the income tax schedule for individuals. On the other hand, self-employed individuals and professionals are taxed based on the income tax schedule for individuals, applicable percentage taxes, and value-added tax (VAT). However, if their gross sales (or gross receipts plus other non-operating income) does not exceed the VAT threshold, they have the option to be taxed either on the basis of the income tax schedule for individuals and the applicable percentage taxes, or just with a flat tax rate of 8% on their gross sales (or gross receipts plus other non-operating income).
Interest income from bank deposits, deposit substitutes, trust funds, and other similar products (except for its long-term variants) is taxed at the rate of 20%.
Royalties, except on books, literary works and musical compositions, are taxed at the rate of 10%.
Prizes and winnings from Philippine Charity Sweepstakes Office (PCSO) Lotto in excess of P10,000 (upon which individual prizes and winnings P10,000 or below are taxed on the basis of the income tax schedule for individuals) are taxed at the rate of 20%.