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 Passive Income
The generation of such income does not require any active action or material
participation from the taxpayer. no exertion effort
of action
Active income if the same arises from the active pursuit of business, using as basis
the primary purpose indicated in the Articles of Incorporation (AOI) or registration.

Characteristics: Final Withholding Tax FINH IFITNH

1. Income payor withholds the tax
2. The amount withheld is the FINAL tax D TWH
3. Only applies to certain passive income II ITR RIT ITR
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General Rule: Gross Income Taxation and Global Taxation to: NRFC and
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>>>>Always Fixed Rate @ 25%

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v Application of the 15% preferential tax rate on intercorporate dividends paid to NRFC under
Tax Sparing Rule:
Section 28(B)(5)(b) (RMO No. 27-2016)
v The tax sparing rule shall apply to an NRFC which is a resident or is domiciled in a country
which: (1) has no effective tax treaty with the Philippines; (2) has a worldwide system of
taxation; and (3) allows a tax credit against the tax due from the NRFC dividend taxes deemed
to have been paid in the Philippines equivalent to 15%.
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 INFORMER TAX REWARD

Amount of Reward v Lower of 10% of amount imposed and collected or 1,000,000

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Requirements: The informer must not be:
q BIR Employee or Officer NY IB mom
q Public Official or Employee
q Relative within 6th degree of consanguinity of either a or b

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 FINAL TAX FILINGS
Form Deadline
BIR Form No. 0619-F - 10th day of the following month at
Monthly Remittance Form for Final which the withholding was made.
Income Taxes Withheld (RR 11-2018)
BIR Form No. 1601-FQ - Filed not later than the last day of the
Quarterly Remittance Return of Final month, following the end of the taxable
Income Taxes Withheld quarter during which the withholding
tax was made.