Income Taxation - Chapter 1 Definition

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Chapter 1 Definition
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  TAX ON INCOMECHAPTER I - DEFINITIONSSection 22.   Defnitions   Person'  means an individual, a trust, estate or corporation. Corporation'  shall include partnerships, no matter how created or organized, joint-stockcompanies, joint accounts (cuentas en participacion), association, or insurance companies,but does not include general professional partnerships and a joint venture or consortiumformed for the purpose of undertaking construction projects or engaging in petroleum, coal,geothermal and other energy operations pursuant to an operating consortium agreementunder a service contract with the Government. General professional partnerships arepartnerships formed by persons for the sole purpose of e!ercising their common profession,no part of the income of which is derived from engaging in any trade or business. Domestic , when applied to a corporation, means created or organized in the hilippines orunder its laws. Foreign , when applied to a corporation, means a corporation which is not domestic. #he term 'non-resident   citizen means$%)   & citizen of the hilippines who establishes to the satisfaction of the 'ommissioner the factof his physical presence abroad with a denite intention to reside therein   .)   & citizen of the hilippines who leaves the hilippines during the ta!able year to resideabroad, either as an immigrant or for employment on a permanent basis.*)     & citizen of the hilippines who works and derives income from abroad and whoseemployment thereat re+uires him to be physically present abroad most of the time   duringthe ta!able year.)   & citizen who has been previously considered as non-resident citizen and who arrives in the hilippines at any time during the ta!able year to reside permanently in the hilippines shalllikewise be treated as a non-resident citizen for the ta!able year in which he arrives in the hilippines with respect to his income derived from sources abroad until the date of hisarrival in the hilippines.)    #he ta!payer shall submit proof to the 'ommissioner to show his intention of leaving the hilippines to reside permanently abroad or to return to and reside in the hilippines as thecase may be for purpose of this ection. Resident alien'  means an individual whose residence is within the hilippines and who isnot a citizen thereof. Non-resident alien'  means an individual whose residence is not within the hilippines andwho is not a citizen thereof. Resident foreign corporation'  applies to a foreign corporation engaged   in trade orbusiness within the hilippines. Non-resident foreign corporation'  applies to a foreign corporation not engaged in tradeor business within the hilippines. Fiduciary'  means a guardian, trustee, e!ecutor, administrator, receiver, conservator or anyperson acting in any duciary capacity for any person.  Withholding agent'  means any person re+uired to deduct and withhold any ta! under theprovisions of ection /. Shares of stock'  shall include shares of stock of a corporation, warrants and0or options topurchase shares of stock, as well as units of participation in a partnership (e!cept generalprofessional partnerships), joint stock companies, joint accounts, joint ventures ta!able ascorporations, associations and recreation or amusement clubs (such as golf, polo or similarclubs), and mutual fund certicates. Shareholder   shall include holders of a share0s of stock, warrant0s and0or option0s topurchase shares of stock of a corporation, as well as a holder of a unit of participation in apartnership (e!cept general professional partnerships) in a joint stock company, a jointaccount, a ta!able joint venture, a member of an association, recreation or amusement club(such as golf, polo or similar clubs) and a holder of a mutual fund certicate, a member in anassociation, joint-stock company, or insurance company. Tapayer'  means any person subject to ta! imposed by this #itle. Taa!le year'  means the calendar year, or the scal year ending during such calendaryear, upon the basis of which the net income is computed under this #itle. #a!able yearincludes, in the case of a return made for a fractional part of a year under the provisions of this #itle or under rules and regulations prescribed by the ecretary of 1inance, uponrecommendation of the commissioner, the period for which such return is made. Fiscal year'  means an accounting period of twelve (%) months ending on the last day of any month other than 2ecember. rdinary income'  includes any gain from the sale or e!change of property which is not acapital asset or property described in ection *3(&)(%). &ny gain from the sale or e!changeof property which is treated or considered, under other provisions of this #itle, as ordinaryincome shall be treated as gain from the sale or e!change of property which is not a capitalasset as dened in ection *3(&)(%). #he term ordinary loss includes any loss from the saleor e!change of property which is not a capital asset. &ny loss from the sale or e!change of property which is treated or considered, under other provisions of this #itle, as ordinary lossshall be treated as loss from the sale or e!change of property which is not a capital asset. B.   General Principles of Income Taxation (pg 55 PM Rev)Section 23 !ational Internal Reven e #o$e Sec. 23.   General Principles of Income Taxation in the Philippines . % &xcept 'en oter'ise provi$e$ in tis #o$ea)   * citizen  of te Pilippines resi$ing terein is taxa+le on all  income $erive$ from so rces 'itin an$ 'ito t tePilippines,  +)   * nonresident citizen  is taxa+le onl- on income $erive$ from so rces within  te Pilippines,c)   *n in$ivi$ al citien of te Pilippines 'o is 'or/ing an$ $eriving income from a+roa$ as an overseas contract'or/er is taxa+le onl- on income from so rces within  te Pilippines Provi$e$ Tat a seaman 'o is a citien of te Pilippines an$ 'o receives compensation for services ren$ere$ a+roa$ as a mem+er of te complement of avessel engage$ excl sivel- in international tra$e sall +e treate$ as an overseas contract 'or/er,$)   *n alien  in$ivi$ al 'eter a resi$ent or not of te Pilippines is taxa+le onl- on income $erive$ fromso rces within  te Pilippines,e)   * domestic corporation  is taxa+le on all  income $erive$ from so rces 'itin an$ 'ito t te Pilippines, an$f)   * foreign corporation  'eter engage$ or not in tra$e or + siness in te Pilippines is taxa+le onl- on income$erive$ from so rces within  te Pilippines.#.Scope of Income Taxation
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