CLASSIFICATIONS OF TAXPAYER IN THE PHILIPPINES: (ICEPT)

1. Individuals2. Corporations3. Estates4. Partnerships5. Trusts

INDIVIDUALS:

1. Resident CitizenDEFINITION: A citizen of the Philippines residing herein

- Non- Resident CitizenDEFINITION: Citizen of the Philippines who:

Establishes to the satisfaction of the Commissioner the fact of his physical presence abroad with a definite intention to reside therein

leaves the Philippines during the taxable year to reside abroad Works and derives his income from abroad, whose employment requires

his physical presence most of the time during the taxable year Has been previously considered as a non-resident citizen who arrives any

time during the taxable year to reside permanently in the PhilippinesKINDS:

2. OCW- Individual citizen of the Philippines who works and derives his income under a valid contract abroad

3. SEAMEN- Citizen of the Philippines who receives compensation for services rendered abroad as a member of the complement of a vessel engaged exclusively in international trade

4. Resident AlienDEFINITION: Individual whose residence is within the Philippines and who is not a citizen thereof &

- Non Resident AlienDEFINITION: individual whose residence is not within the Philippines and who is not a citizen thereof. KINDS:

5. Non- resident Alien engaged in trade or business within the Philippines6. Non- resident Alien not engaged in trade or business within the Philippines7. Non- resident Aliens employed by:

Regional or area headquarters and regional operating headquarters established in the Philippines by multinational companies (RAH ROH by MC)

Offshore banking units established in the Philippines (OBU) Petroleum services contractor and subcontractor (PSC)

How are they taxed?1. RC- All incomes derived from sources within & without the Philippines2. (NRC) OCW & Seamen- Incomes derived from sources within the Philippines 3. RA & NRA- income derived from sources within the Philippines. Provided that

AEBPSC shall always be considered as a resident citizen

CORPORATIONS:1. Domestic- created or organized in the Philippines or under its laws. 2. Resident Foreign- created or organized under the laws of another country and is

engaged in trade or business in the Philippines3. Non-resident foreign- created or organized under the laws of another country and is not

engaged in trade or business in the Philippines

INDIVIDUAL TAXPAYERS

NET INCOME TAX/ TAXABLE INCOME

GROSS INCOME TAX(Subject Sec. 32)

FINAL INCOME TAX/ PASSIVE INCOME

RC Liable LiableOCW Liable for sources

w/in the PHLiable for sources

w/in the PHSEAMEN Liable for sources

w/in the PHLiable for sources

w/in the PHRA Liable for sources

w/in the PHLiable for sources

w/in the PHNRAE in TB Liable for sources

w/in the PHLiable for sources

w/in the PHNRANE in TB Not Liable Not Liable

AE by:1. RAH,ROH by

MC2. OBU3. PSC

1. Liable2. Liable3. Liable

*1 and 2 depends:If NRAE in TB: LiableIf not: Not Liable*3: Liable

* A nonresident alien individual who shall come to the Philippines and stay therein for an aggregate period of more than one hundred eighty (180) days during any calendar year shall be deemed a 'nonresident alien doing business in the Philippines' *Aliens employed by PSC are always considered as a RA because their tax is depending upon contract agreement

Reasonable benefit plan- pension, gratuity, stock bonus, or profit sharing plan maintained by an employer for the benefit of his officers or employees, wherein the contributions made by an employer is for the purpose of distributing to such officers or employees, the earnings accumulated.