Transactions subject to OPT: For 1. Exempt from VAT 1. Cars for rent or hire 2. Domestic Carrier 2. Transportation who transport passenger 3. International Carrier 3. Domestic carrier by land for transport of 4. Franchise holder of water and gas passengers 5. Bank and non-bank intermediaries 4. Keepers of garage 6. Finance companies Not included: 7. Life insurance company 1. Banca owners and; 8. Agent of foreign institution 2. Owners of animal-driven vehicle 9. Amusement places Rate: 3% of minimum gross receipts or actual receipts, 10. Winnings from race horses whichever is higher. 11. Sales of stock through Initial Public Offering(IPO) Minimum Receipts Manila Provincial SECTION 116: TAX ON PERSONS EXEMPT FROM VAT Jeep 2,400 1,200 If gross sales or receipts equal or less than 3,000,000 PUB and not VAT registered. Up to 30 3,600 3,600 31-50 6,000 6,000 Rate: 3% 50-up 7,200 7,200 Base: If sale of goods= Gross sales; Taxis 3,600 2,400 If lease and services= Gross Receipts Car w/chauffer 3,000 3,000 Car w/o chauffer 1,800 1,800
3% is not applicable to: Province of Camarines Norte
1. Cooperative, except cooperatives with reserves and Jeep 1,000 actual net savings more than 10M. BUS 31 seater 7,000 2. Fees, per diems, allowances and other income received by corporate directors 5,200x3% MALI ITO 3. Marginal income earner with receipts equal or less 6,000+1,200=7,200x3% than 100,000 for 12-month period. 4. Persons who are VAT-registered Tax on common carrier? 5. Persons who are not VAT-registered but sales/receipts is greater than 3,000,000 Section 118: INTERNATIONAL FOREIGN CARRIER-SHIPPING AND AIR CARRIER Every 25th day following the close of taxable quarter Rate: 3% base on gross receipts of cargo from Philippines to foreign country Dividends in Equity = 0% Royalties, Rental, and other income = 7% LAND AIR SEA Net gain in trading debt instrument = 7% Domestic Passenger 3% OPT VAT VAT Carriage Cargo VAT VAT VAT SECTION 122: FINANCE COMPANIES = use rate in section 121 International Passenger-DC N/A 0% VAT 0% VAT Carriage Goods & N/A 0% VAT 0% VAT SECTION 123= Tax on life insurance = 2% of premiums Cargoes received Passenger-FC N/A No OPT No OPT Except: Received by cooperative, refunded within 6 Goods&Cargoes N/A 3% OPT 3% OPT months, reinsurance premium paid and collected from domestic company in which there is branch in foreign UNDER CREATE LAW, 1% shall be payable until June 30, 2023 country. for all those paying 3% except the franchise on radio, tv and the likes. Section 124: Agent Foreign Insurance = Fire, Marine= 10% of collected insurance premium Section 119: FRANCHISE If owners of properties = 5% of premiums paid 1. Radio, TV and the likes in which sales/receipts is less than 10M=Tax rate is 3% of gross receipts Section 125: AMUSEMENT TAXES – base on Gross receipts 2. Gas and water = 2% of gross receipts 1. Cockpits – 18% 3. PAGCOR = 5% of gross revenues 2. Cabarets – 18% 3. Night/Day club – 18% SECTION 120: OVERSEAS COMMUNICATION – For outgoing calls, 4. Boxing – 10%, except: meaning from Philippines to Foreign country. a. World title fight If calls within Philippines, subject to VAT. b. Promoted by Filipino citizen Tax rate and base: 3% of gross receipts c. One contender is Filipino Except: 5. Professional Basketball – 15% 1. Diplomatic services 6. Jai-Alai – 30% 2. International organization 7. Race Track – 30% 3. News services 4. Government SECTION 126: WINNING FROM RACE HORSES: 1. Owners of race horses = 10% of Prize SECTION 121: BANKS AND NON-BANKS 2. Winnings from double, quinella, and trifecta bets = 4% of winnings Interest from lending activities 3. Winnings in horse races other than number 2 = 10% 1. Maturity 5 years or less = 5% of winnings 2. Maturity 5 years or more = 1% SECTION 127: STOCK TRANSACTION TAX – Not deductible expenses If listed = Gross selling price one half of 1%. Under TRAIN 6/10 of 1% If sale in IPO- Ratio of: Shares sold/Outstanding shares If ratio: 25% & below = tax rate is 4% 25 – 33% = tax rate is 2% 33 – up % = tax rate is 1%
To get the tax, Shares sold times selling price per share x the rate.
IPO 25,000 shares
TOTAL OUTSTANDING 90,000 shares
IPO SOLD at 5/share
OPT ON STOCK TRANSACTION?
1. Get ratio 25,000/90,000 x100=28% 2. Get the bracket of ratio
Invested: How I Learned to Master My Mind, My Fears, and My Money to Achieve Financial Freedom and Live a More Authentic Life (with a Little Help from Warren Buffett, Charlie Munger, and My Dad)
Taxes for Small Business: The Ultimate Guide to Small Business Taxes Including LLC Taxes, Payroll Taxes, and Self-Employed Taxes as a Sole Proprietorship
Tax Accounting: A Guide for Small Business Owners Wanting to Understand Tax Deductions, and Taxes Related to Payroll, LLCs, Self-Employment, S Corps, and C Corporations
Freight Broker Business Startup: Step-by-Step Guide to Start, Grow and Run Your Own Freight Brokerage Company In in Less Than 4 Weeks. Includes Business Plan Templates