Final Witholding Tax on Passive Income

1. Applicable only to passive income from sources within the Philippines

2. Passive Income derived from outside of the Philippines are subject to basic income tax
3. Tax deducted from the income to be paid to the payee or seller
4. It is constituted as "full and final payment" of the income tax liability
5. The income subject to this tax is no longer included in the ITR of the Individual Taxpayer under section 24a
*Note: The concepts above are derived from the rules on individual taxpayer's position.

FWT on Interest Income (Individuals) FWT on Interest Income (Corporations)

NRC NRA INT INC BANK
INT INC BANK DEPOSIT RC RA NRC NETB DC RFC NRFC
ETB DEPOSIT
ANY CURR 20% 20% 25% any currency, ds, tf 20% 20% 30%
FCDS (Train Law) 15% EX EX efcds (TRAIN LAW) 15% 7&1/2% ex
FCDS (Prior 2018) 7.50% EX EX efcds (OLD NIRC) 7&1/2% 7&1/2% ex
LT BANK 5 YEARS EX EX 25%
Pre-terminated Long term loan but held for: Do not be confused:
5 YRS MORE EX EX 25%
Income derived by DEPOSITORY BANKS under the efcds
4 TO 5 5% 5% 25%
3 TO 4 12% 12% 25% from FC
Treatment?
LESS 3 20% 20% 25% transactions with:
Non- residents exempt FWT and Income Tax
OBUs in the PH exempt
Local commercial
exempt
banks
Branches of Foreign
exempt
Banks

Residents 10%
 FWT on Dividends (Individuals) FWT on Dividends (Corp)
Actually or Constructively RECEIVED BY From Received by:
received from: RA RC NRC NRA ETB NRA NETB dividends from dc DC RFC NRFC
DC 10% 20% 25% ex ex 15 or 30%
Share in NIAT of Partnership with tax
10% 20% 25% 15%
(except GPP w/c is basic tax) sparing

without tax
RFC/NRFC Basic Tax Basic Tax 25% FWT 30%
sparing

Stock Div. / Liquidating Div.

received from:
Generally Non-Taxable
DC
RFC/NRFC

fwt on royalties (INDIVIDUALS) fwt on royalties (CORPORATIONS)

Royalties derived from: RA RC NRC NRA-ETB NRA-NETB RA RC NRC NRA-ETB NRA-NETB
Royalties
B,LW,MC 10% 10% 25% 20% 20% 30%
OTHER 20% 20% 25%

FWT on Winnings
Winnings from RA RC NRC NRA-ETB NRA-NETB
Other Winnings 20% 20% 25%
PCSO Lotto (Old NIRC) exempt exempt 25%
PCSO Lotto (Train Law)
a. < OR = 10k exempt exempt 25%
b. > 10k 20% exempt 25%
 FWT on Prizes
Amount RA RC NRC NRA-ETB NRA-NETB
> 10k 20% 20% 25%
< OR = 10k BT BT 25%