Income Tax - 3-28-12 Ganer Final

8/19/2019 Income Tax - 3-28-12 Ganer Final

1/85

INCOME TAX

Presented by:

LILYBETH A. GANER, CPA, MBARevenue Off !erRR"#$, %&v&' C ty

#


2/85

Bus ness In!'(eAny n!'(e n't re)&ted t' &n e(*)'yer"e(*)'yee re)&t 'ns+ *Gener&))y t& &b)e 'n t+e net n!'(e

In!)udes -& ns, *r'f ts &nd n!'(e n+&tever f'r( der ved fr'( &ny s'ur!e,)e-&) 'r ))e-&), su!+ &s /

E er! se 'f *r'fess 'n 'r v'!&t 'nTr&de, bus ness 'r !'((er!e

%e&) n-s n *r'*erty0ru ts 'f t+e ' ners+ * 'r use 'f *r'*ertyInterest, rent, d v dends, se!ur t esOt+er tr&ns&!t 'ns 'f t+e bus ness f'r -& n 'r*r'f t

1


3/85

Gr'ss n!'(e

A)) n!'(e fr'( +&tever s'ur!eder ved, n!)ud n- but n't ) ( ted t't+e f'))' n- te(s:

C'(*ens&t 'n f'r serv !es, n!)ud n-fees, !'(( ss 'ns &nd s ( )&r te(sGr'ss n!'(e der ved fr'( bus ness 're er! se 'f *r'fess 'nG& ns fr'( de&) n-s n *r'*ertyInterestRents

2


4/85

Gr'ss n!'(e 3!'nt.4R'y&)t es% v dendsAnnu t esPr 5es &nd nn n-sPens 'nsP&rtner ’s d str but ve s+&re n t+e net

n!'(e 'f -ener&) *r'fess 'n&)*&rtners+ *

6


5/85

Net In!'(e

T+e re&) 5ed -r'ss *r'f t &fter dedu!t n- &)) t+ededu!t 'ns &))' ed by )& , st&tutes 'r -ener&))y&!!e*ted &!!'unt n- *r n! *)es.

ExclusionsT+e t't&) benef ts + !+ s n't n!)uded n t+e!'(*ut&t 'n 'f -r'ss n!'(e f'r t+e *ur*'se 'fdeter( n n- t& &b)e n!'(e.

DeductionsIte(s 'r &('unts + !+ t+e )& &))' s t' bededu!ted fr'( -r'ss n!'(e t' &rr ve &t t+e t& &b)e

n!'(e.7


6/85


7/85

Re=u s tes f'r %edu!t b ) ty 'f E *enses

Ord n&ry &nd ne!ess&ryP& d 'r n!urred t+ n t+e t& &b)e ye&rIn!urred n t+e !'ndu!t 'f tr&de 'r bus nessN't !'ntr&ry t' )& , ('r&)s, *ub) ! *') !y 'r*ub) ! 'rder9ubst&nt &ted by suff ! ent *r''f

9ub>e!ted t' t++')d n- t& , f &**) !&b)e

?


8/85

Ite( 5ed %edu!t 'n

#. Ord n&ry &nd ne!ess&ry tr&de,bus ness 'r *r'fess 'n&) e *enses

9&)&r es @ &-esTr&ve) e *ensesRent&) e *ensesEntert& n(ent, &(use(ent &ndre!re&t 'n e *enses

1. Interest2. T& es


9/85

Ite( 5ed %edu!t 'n 3!'nt.4

6. L'ssesNet O*er&t n- L'ss C&rry Over 3NOLCO4C&* t&) )'ssesL'sses fr'( &s+ s&)es 'f st'! s 'rse!ur t es

&-er n- )'sses

Ab&nd'n(ent )'sses

$


10/85

Ite( 5ed %edu!t 'n 3!'nt.4

7. B&d debts


11/85


12/85

InterestT+e nterest *&y(ent &rr&n-e(ent (ust n'tbe bet een re)&ted t& *&yers.T+e nterest s n't e *ress)y d s&))' ed by

)& t' be dedu!ted fr'( t+e t& *&yer ’s-r'ss n!'(e 3e.-., nterest 'n ndebtednesst' f n&n!e *etr')eu( '*er&t 'ns4D &ndT+e &('unt 'f nterest dedu!ted fr'( -r'ss

n!'(e d'es n't e !eed t+e ) ( t set f'rt+ nt+e )& .

#2


13/85

Interest

Limitation

T+e &('unt 'f nterest e *ense *& d 'r n!urredfr'( &n e st n- ndebtedness s+&)) be redu!ed by &n

&('unt e=u v&)ent t+e f'))' n- *er!ent&-es 'f t+enterest n!'(e e&rned dur n- t+e ye&r + !+ +&d

been sub>e!ted t' f n&) t++')d n- t&

F&n. #$$ " 6#;

F&n. #$$$ " 2$;F&n. 1 " 2 ;N'v 1 7 " 61;F&n. 1 $ " 22;

Applies regardless of the date the

interest bearing loan and the datewhen the investment was made foras long as, during the taxable yearthere is an interest expenseincurred and an interest incomeearned.

#6


14/85

EXCEPTIONS• Deductible in full from gross income

Interest on unpaid taxes – interest paid or incurred on all unpaid

business-related taxes shall be deductible in full

• Not deductible from gross income

a. Interest incurred on indebtedness of taxpayer using cash basis,

where the interest is paid in advance thru discount or otherwisei. Allowed as a deduction in the year the indebtedness was paid

ii. If amortized – amount corresponding to the principalamortized shall be allowed as deduction during the year

Interest

#7


15/85

Not deductible from gross income

b. Interest *&y(ents bet een re)&ted *&rt es &ss*e! f ed n 9e!. 2


16/85


17/85

T& es

A)) bus ness re)&ted t& esN'n"dedu!t b)e t& es

In!'(e t& *& d n t+e P+ )s.

In!'(e t& (*'sed by &ut+'r ty 'f f're -n!'untry / t& !red t t+ ) ( t&t 'nEst&te &nd d'n'r ’s t& esT& &ssess(ent + !+ n!re&ses t+e v&)ue 'f t+e*r'*erty &ssessed

E)e!tr ! ener-y !'nsu(*t 'n t& under B.P. 2e!t t') ( t&t 'n

#


18/85


19/85

T& esRefund 'f t& *&y(ent

T& es refunded s+&)) be n!)uded n t+eye&r 'f re!e *t t' t+e e tent 'f t+e n!'(et& benef t 'f su!+ dedu!t 'n 3t& benef tru)e4

1


20/85

T& es

% s!)'sure re=u re(ent 'n t& es3N'tes t' 094 RR #7"1 #

T+e n'tes 'f f s s+&)) n!)ude nf' 'nt& es, dut es &nd ) !ense fees *& d 'r&!!rued dur n- t+e t& &b)e ye&r

T+e &('unt 'f AT Out*ut t& &nd t+e&!!'unt t t)e &nd &('unt s u*'n + !+ t+es&(e &s b&sed,

1#


21/85

L'ssesRe=u s tes f'r dedu!t b ) ty

In!urred n tr&de, bus ness 'r *r'fess 'nN't !'(*ens&ted by nsur&n!e 'r 't+er f'r( 'f

nde(n tyIn !&se 'f *r'*erty, f'r )'sses &r s n- fr'( f re,st'r(, s+ * re! , 't+er !&su&)ty, r'bbery, t+eft,e(be55)e(ent, t+e *r'*erty (ust be used ntr&de, bus ness 'r *r'fess 'n &nd re*'rted

t+ n f'rty"f ve 3674 d&ys fr'( d&te 'f'!!urren!e 'f su!+ )'ss.N't !)& (ed &s dedu!t 'n f'r est&te t& *ur*'ses

11


22/85

Net O*er&t n- L'ss C&rry"'ver3NOLCO4 RR #6"1 #

Net '*er&t n- )'ss " (e&ns t+ee !ess 'f &))' &b)e dedu!t 'n 'ver -r'ss

n!'(e 'f t+e bus ness n & t& &b)e ye&r

12


23/85

B&d %ebts Re=u s tes f'r v&) d dedu!t 'n

T+ere (ust be &n e st n- ndebtedness due t't+e t& *&yer

It (ust be v&) d &nd )e-&))y de(&nd&b)eIt (ust be !'nne!ted t+ t+e t& *&yer ’s tr&de,bus ness 'r *r&!t !e 'f *r'fess 'nIt (ust n't be sust& ned n & tr&ns&!t 'n entered

nt' bet een re)&ted *&rt esIt (ust be &!tu&))y !+&r-ed 'ff fr'( t+e b'' s 'f&!!'unts &s 'f t+e end 'f t+e t& &b)e ye&rIt (ust be &s!ert& ned t' be 'rt+)ess &ndun!'))e!t b)e &s 'f t+e end 'f t+e ye&r

16


24/85

%e*re! &t 'nA re&s'n&b)e &))' &n!e redu!t 'n n serv !ev&)ue f'r t+e e +&ust 'n, e&r &nd te&r 'f*r'*erty used n tr&de, bus ness 'r *r&!t !e

'f *r'fess 'n.

Met+'ds 'f de*re! &t 'n9tr& -+t ) ne (et+'d%e!) n n- b&)&n!e (et+'d9u( 'f t+e ye&r ’s d - t (et+'dAny 't+er (et+'d + !+ (&y be *res!r bed

17


25/85


26/85

C+&r t&b)e &nd 't+er C'ntr but 'ns

%'n&t 'ns t+ ) ( ted dedu!t b ) ty0'r t+e use 'f -'vern(ent e !)us ve)y f'r *ub) !*ur*'se

T' &!!red ted d'(est ! !'r*'r&t 'n 'r&ss'! &t 'n 'r-&n 5ed &nd '*er&ted e !)us ve)yf'r re) - 'us, !+&r t&b)e, s! ent f !, y'ut+ &nds*'rts deve)'*(ent, !u)tur&) 'r edu!&t 'n&)*ur*'ses

0'r t+e re+&b ) t&t 'n 'f veter&ns0'r s'! &) e)f&re nst tut 'nsT' n'n"-'vern(ent 'r-&n 5&t 'n

1?


27/85

C+&r t&b)e &nd 't+er C'ntr but 'ns

R&te 'f dedu!t 'n

Ind v du&) d'n'r " # ; 'f net n!'(ebef're dedu!t n- d'n&t 'ns

C'r*'r&te d'n'r " 7; 'f net n!'(e bef'rededu!t n- d'n&t 'ns

OR

A!tu&) !'ntr but 'n d'n&t 'n

WHICHEVER IS LOWER

1


28/85


29/85

Entert& n(ent, A(use(ent @Re!re&t 'n&) 3EAR4 E *enses

In!)udes re*resent&t 'n e *ense &nd 'rde*re! &t 'n 'r rent&) e *ense re)&t n- t'entert& n(ent f&! ) t es.Re*resent&t 'n e *ense s+&)) refer t'e *enses n!urred n entert& n n-,*r'v d n- &(use(ent &nd re!re&t 'n t', 'r(eet n- t+ -uest 'r -uests &t d n n-

*)&!e, *)&!e 'f &(use(ent, !'untry !)ub,t+e&ter, !'n!ert, *)&y, s*'rt n- event &nds ( )&r events 'r *)&!es.

2


30/85

E *enses NOT !'ns dered EARE *enses tre&ted &s !'(*ens&t 'n 'r fr n-e benef tsE *ense f'r !+&r t&b)e 'r fund r& s n- eventsE *ense f'r b'n&f de bus ness (eet n- 'f st'! +')ders,

*&rtners 'r d re!t'rsE *enses f'r &ttend n- 'r s*'ns'r n- e(*)'yee t' &bus ness )e&-ue 'r *r'fess 'n&) 'r-&n 5&t 'n (eet n-E *enses f'r events 'r-&n 5ed f'r *r'('t 'n (&r et n-&nd &dvert s n- n!)ud n- !'n!erts, !'nferen!es, se( n&rs,

'r s+'*s, !'nvent 'n, &nd 't+er s ( )&r event.Ot+er e *ense 'f s ( )&r n&ture


2#


31/85


T+e t& *&yer s+'u)d (& nt& n re!e *ts &nd&de=u&te re!'rds t+&t nd !&te t+e

T+e &('unt 'f e *ense%&te &nd *)&!e 'f e *ensePur*'se 'f e *ensePr'fess 'n&) 'r bus ness re)&t 'ns+ * 'fe *enseN&(e 'f *ers'n &nd !'(*&ny entert& ned

t+ !'nt&!t det& )s

21


32/85


33/85


I(*'s t 'n 'f Ce ) n- J9e!. 263A43#43&43 v4 'f NIRC4 @ RR # "1 #K

ctual entertainment! amusement and recreation ex"ense

OR

.7; 'f net s&)es f'r se))ers 'f -''ds &nd *r'*ert es#; 'f net revenues f'r se))ers 'f serv !es

WHICHEVER IS LOWER

26


34/85

TAXPAYER ENGAGED IN BOTHTAXPAYER ENGAGED IN BOTHSA E O! GOODS AND SER"I#ESSA E O! GOODS AND SER"I#ES

Allowable &A' expense shall be determined based onapportionment formula –

Percentage of net sales/net revenue to the total net sales/netrevenue multiplied by the actual EAR expense

Net s$les%net re&enue ' Actu$l e'(ense Tot$l net s$les%re&enue

Note)

In no case shall the total EAR exceed the maximum percentageceiling 27


35/85

Illustr$tion)&'A (orporation is engaged in the sale of goods andservices with net sales)net revenue of *%"",""" and*+"",""" respectively. he actual &A' for the year %"+"totaled * ,"""

#om(ut$tion )*Apportionment formula

ale of goods /*%"",""")* "","""0 x * ,""" 1 *%,"""ale of service /*+"",""") "","""0 x * ,""" 1 *+,"""

**Maximum percentage ceiling

ale of goods *%"",""" x ".!"# 1 *+,"""ale of service *+"",""" x +# 1 *+,"""

2<


36/85

Net s$les%net re&enue

EAR e'(enseb$sed on

$((ortionmentformul$*

+$'imum(ercent$geceiling ofEAR**

Allo,$ble$mount tobe cl$imed

$s EAR -,%ce&er islo,er.

ale ofgoods

*%"",""" *%,""" *+,""" *+,"""

ale ofservices

*+"",""" *+,""" *+,""" *+,"""

otal * "",""" * ,""" *%,""" P/0111

#om(ut$tion)

&'A (orporation can only claim a total of *%,""" as EAR2?


37/85

In lieu of the itemized deductions enumerated underSec. 34(A) to (J) and (M) and Sec. 37 of the Tax

ode and other s!ecial la"s (if a!!lica#le) .

O*t 'n&) 9t&nd&rd %edu!t 'n

2


38/85


Indi#iduals Res dent ! t 5en N'n"res dent ! t 5en Res dent A) en T& &b)e est&tes &nd trusts

Cor"orations $sub%ect to normal income tax rate& %'(est ! !'r*'r&t 'n Res dent f're -n !'r*'r&t 'n

2$


39/85

O*t 'n&) 9t&nd&rd %edu!t 'nInd v du&) C'r*'r&t 'n

R&te 6 ; 'f -r'sss&)es revenues

6 ; Gr'ssn!'(e

T& B&se E !)ud n-*&ss ve n!'(esub>e!t t' f n&)

t++')d n- t&

E !)ud n-*&ss ve n!'(esub>e!t t' f n&)

t++')d n- t&

C'st 'fs&)es serv !es

N't &))' ed t'dedu!tCO9 serv !es

A))' ed t'dedu!tCO9 serv !es

6


40/85

% s!)'sure 'f e)e!t 'n t' use t+e O9%3RMC #


41/85

% s!)'sure 'f e)e!t 'n t' use t+e O9%3RMC #


42/85

I(*) !&t 'n 'f O9%O*t 'n s rrev'!&b)e f'r t+e t& &b)e ye&r f'r

+ !+ t+e return s (&de.

Any subse=uent &(end(ent 'f ITR f )ed f'rt+e f rst n t &) =u&rter s+&)) n't &ffe!t t+e

rrev'!&b)e !+&r&!ter 'f t+e e)e!t 'n t' &v& )'f t+e O9% 'r te( 5ed dedu!t 'n.

Ind v du&) !)& ( n- t+e O9% s n't re=u redt' sub( t f n&n! &) st&te(ents but s+&)) ee*re!'rds 'f + s -r'ss s&)es re!e *ts


67


43/85

Illustr$tion 2Mr. Er& , & ret& )er 'f -''ds uses t+e &!!ru&) (et+'d 'f

&!!'unt n- n re*'rt n- + s n!'(e &nd e *enses. 0'rt+e ye&r 1 # , t+e f'))' n- &re + s re!'rded n!'(e&nd e *enses

Mr. Er& uses t+e O9% &s nd !&ted 'n + s # st =u&rterITR. C'(*ute f'r t+e &))' &b)e dedu!t 'ns f'r e&!+ 'ft+e =u&rters 'f 1 # &nd t+e net n!'(e f'r t+et& &b)e ye&r.

Gr'ss s&)es

C'st 'fs&)es

O*er&t n-e *

F&n"FuneFu)y"9e*tO!t"%e!

P#, ,? ,$ ,

P< ,1 ,6 ,

P7 ,# ,

6<


44/85

#om(ut$tion 2

a& llo'able deductions(an) * (une (ul+ * Se"t Oct , Dec

Gr'ss s&)es P#, , P? , P$ ,Less: C'st 'f s&)es " " " " " /Gr'ss s&)es n!'(e P #, , P? , P$ ,X O9% r&te 6 ; 6 ; 6 ;

OSD - .//!/// -01/!/// -23/!///

b& Net income for 0/4/

Gr'ss s&)es 3F&n / %e!4 P1,< , O9% 36 ;4 #, 6 , Net income 4!53/!///

6?


45/85

Illustr$tion /G9 C'r*'r&t 'n, & ret& )er 'f -''ds, uses t+e &!!ru&)

(et+'d n de!)&r n- ts n!'(e &nd e *enses. 0'r t+e!&)end&r ye&r 1 # , t+e f'))' n- &re t+e re!'rds 'f ts

n!'(e &nd e *enses:

G9 C'r*. uses t+e O9%. C'(*ute f'r t+e =u&rter)y&))' &b)e dedu!t 'ns 3!'st &nd e *enses4 &nd t+e net n!'(ef'r 1 # .

Gr'ss s&)es

C'st 'fs&)es

O*er&t n-e *

F&n"FuneFu)y"9e*tO!t"%e!

P#, ,? ,$ ,

P? ,2 ,< ,

P# ,1 ,# ,

6


46/85

#om(ut$tion /

$. llo'able deduction(an * (une (ul+ * Se"t Oct * Dec

Gr'ss s&)es P#, , P? , P$ , Less C'st 'f s&)es ? , 2 , < , Gr'ss n!'(e 2 , P6 , P2 , X O9% r&te 6 ; 6 ; 6 ; O9% O*er&t n- e *enses P#1 , P#< , P#1 , Add: C'st 'f s&)es ? , 1 , # ,

Total deductions -10/!/// -23/!/// -00/!///

b& Net income Gr'ss s&)e P1,< ,

C'st 'f s&)es #,< , Gr'ss n!'(e #, , O9% 36 ;4 6 ,

Net income - 3//!///

6$


47/85

Taxation of Mixed Income

50

It f'))' s t+e !'(*&rt(ent&) 5ed &**r'&!+f'r return&b)e n!'(e.Pers'n&) e e(*t 'ns &re f rst dedu!tedfr'( !'(*ens&t 'n n!'(e.E !ess 'f PE 'ver !'(*ens&t 'n n!'(e &rededu!t b)e fr'( net n!'(e fr'( bus ness.9e*&r&te !'(*ut&t 'n 'f n!'(e t&) &b ) ty f'r +usb&nd &nd fe.On)y 'ne s*'use )) !)& ( &dd t 'n&)*ers'n&) e e(*t 'n.

7


48/85

T& &b)e !'(*ens&t 'n n!'(e s &dded t't& &b)e n!'(e fr'( bus ness &nd t+e&--re-&te t& &b)e n!'(e s sub>e!ted t't+e -r&du&ted t& r&tes.L'ss fr'( bus ness !&n n't be 'ffset&-& nst !'(*ens&t 'n n!'(e but !&n be!&rr ed 'ver &s NOLCO.One !'ns') d&ted n!'(e t& return f'r+usb&nd &nd fe.P&y"&s"y'u"f )e, but nst&))(ent s &))' ed ft& due e !eeds P1, J9e!. 7


49/85

T& &t 'n 'fM&r- n&) In!'(e E&rners 3RR ##" 4

Ind v du&)s n't der v n- !'(*ens&t 'n n!'(e9e)f"e(*)'yed%er v n- -r'ss s&)es re!e *ts n't e !eed n-

P# , dur n- &ny #1"('nt+ *er 'dPr n! *&))y e&rn n- f'r subs sten!e 'r ) ve) +''dE e(*t fr'( AT &nd &ny *er!ent&-e t&N't re=u red t' *&y t+e re- str&t 'n feeRe=u red t' re- ster &s t& *&yerE e(*t fr'( t+e nv' ! n- re=u re(ents

71


50/85

T& &t 'n 'fM&r- n&) In!'(e E&rners 3RR ##" 4

E e(*t fr'( (& nt& n n- b'' s 'f &!!'untsRe=u red t' f )e t+e Annu&) In!'(e T& Return30'r( #? 4 but n't re=u red t' &tt&!+

0 n&n! &) 9t&te(ents 'r A!!'unt Inf'r(&t 'n0'r( t' t+e f )ed ITRM&y 'r (&y n't be ) &b)e t' t&

72


51/85

In!'(e T& C'(*ut&t 'n

C'r*'r&te T& *&yer

76


52/85

77

W6at is a cor"oration7W6at is a cor"oration7

Cor"oration / s &n &rt f ! &) be n- !re&ted by )& , +&v n-t+e r -+ts 'f su!!ess 'n &nd t+e *' ers, &ttr butes &nd*r'*ert es &ut+'r 5ed by )& 'r n! dent t' ts e sten!e.

8or taxation "ur"oses! cor"oration s6all include / P&rtners+ *s

F' nt"st'! !'(*&n es

F' nt &!!'unts

Ass'! &t 'ns

Insur&n!e !'(*&n es


53/85

7<

cor"oration does not include /

$Gener&) Pr'fess 'n&) P&rtners+ *

$F' nt venture 'r !'ns'rt u( f'r(ed f'r t+e

*ur*'se 'f undert& n- !'nstru!t 'n *r'>e!ts'r en-&- n- n *etr')eu(, !'&), -e't+er(&)&nd 't+er ener-y '*er&t 'ns *ursu&nt t' &n'*er&t n- 'r !'ns'rt u( &-ree(ent under &serv !e !'ntr&!t t+ t+e -'vern(ent


54/85

9INI9:9 COR-OR TE INCO9E T ;

$9CIT&RR N'. $"$ , &s &(ended by RR n'. #1" ?

7?


55/85

9e!. 1?3E4 &nd 1 3A4314 'f t+e NIRCI(*'sed 'n:

%'(est ! @ Res dent 0're -n

2% on Gr'ss In!'(e

if: - in the 4 th year of operation - net loss/zero taxable income/ MCIT is reater than !CIT

7


56/85

7$

e!t t' f n&). t++')d n- t& .

8or Sale of goods

= In!)ude 'n)y s&)es !'ntr but'ry t' n!'(e t& &b)e under 9e!.1?3A4 'f t+e C'de.

=Cost of goods sold> In!)ude &)) bus ness e *enses d re!t)y n!urred t' *r'du!e t+e(er!+&nd se t' br n- t+e( t' t+e r *resent )'!&t 'n &nd use.

Gr'ss s&)es / 3!'st 'f -''ds s')d s&)es returns d s!'unts &))' &n!es4


57/85

<

8or sale of ser#ices

= In!)ude n!'(e fr'( s&)e 'f serv !es, ) e se, t& &b)eunder 9e!. 1?3A4

=Cost of ser#ices or Direct cost of Ser#ices>In!)ude &)) bus ness e *enses d re!t)y n!urred 'r re)&tedt' t+e -r'ss revenue fr'( rend t 'n 'f serv !es.

Gr'ss revenue / 3!'st 'f serv !es d re!t !'st s&)esreturns d s!'unts &))' &n!es4


58/85


59/85


60/85


61/85


62/85

eure Le- t (&te bus ness reverses

$ W6o ma+ sus"end 9e!ret&ry 'f 0 n&n!e u*'n

re!'((end&t 'n 'f t+e CIR


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CONCE-T O8 I ETCONCE-T O8 I ET

$ T& *&yer s & !'r*'r&t 'n$ I(*r'*er &!!u(u)&t 'n 'f t& &b)e n!'(e bey'nd

t+e re&s'n&b)e needs 'f t+e bus ness$ N'n"d str but 'n 'f e&rn n-s *r'f ts t' st'! +')ders$ T+e *ur*'se 'f &!!u(u)&t 'n s t' &v' d t+e

*&y(ent 'f t+e n!'(e t&$ I(*'s t 'n 'f t& e=u v&)ent t' # ; 'f t+e

(*r'*er)y &!!u(u)&ted t& &b)e n!'(e

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Reasonable #s) :nreasonable ccumulation

Re&s'n&b)e Needs 'f Bus ness:I((ed &te needs 'f bus ness, n!)ud n-re&s'n&b)y &nt ! *&ted needs 3I((ed &!y

Test4

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nre&s'n&b)e &!!u(u)&t 'n 'f Pr'f ts

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# ; 'f *& d"u* !&* t&) 'r !'ntr but 'nre*resent n- t+e *&r v&)ue 'f t+e s+&res'f st'! .

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C'r*'r&t 'n E e(*t fr'( IAET

an$s and non-ban$ financial intermediariesInsurance companies*ublicly held corporations

axable partnerships3**

4on-taxable 5oint ventures

6irms registered under 'A 78+9, 7%%7, and otherspecial ecozones

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I9-OSITION O8 I ETI9-OSITION O8 I ET

T& r&te # ;

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Closel+,6eld cor"orationsB

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nd re!t)y by 'r f'r n't ('re t+&n 1nd v du&)s

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??

T ; A SE O8 I ETT ; A SE O8 I ET$Im"ro"erl+ ccumulated Taxable Income&$Im"ro"erl+ ccumulated Taxable Income&

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% v. &!tu&))y 'r !'nst. *& d ssued T't&) Less : A('unt t+&t !&n be ret& ned

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Pr'f ts sub>e!ted t' IAET, +en f n&))y de!)&red &s d v dends, s+&))be nevert+e)ess be sub>e!t t' # ; f n&) t++')d n- t&

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In!'(e T& 0'r(s &nd%ue %&tes

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!ormNo3

!orm N$me De$dline for !iling No3 of #o(ies

+7"%: :uarterly Income ax'eturn/6or (orporations,*artnerships and ;ther

4on-individualaxpayers0

9" daysfollowing theclose of the first

taxable


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1

NOTEB

Inst&))(ent P&y(ents$A**) !&b)e t' nd v du&) t& *&yer

'n)y &nd NOT TO CORPORATION

ne t


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Ne In!'(e T& 0'r(s

Presented by:

LILYBETH A. GANERRevenue Off !erA99E99MENT %I I9ION

RR #$"%A AO CITY


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T' be re&d by &n '*t !&) !+&r&!ter re&derse N'v. 1 ## vers 'n

B' Ty*e9+&d n-A)) nf'r(&t 'n (ust be r tten n !&* t&))etters

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0e&tures


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3no in is not eno h e m stapply 6illin is not eno h em st +o 7

Johann Wolfgang von Goethe

Income Tax - 3-28-12 Ganer Final

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