Question

Discuss the classification of individual income taxpayers and the categories of income and tax rates based on latest "Train" Law

Answer 1

Discuss the classification of individual income taxpayers

• Filipino citizens residing in the Philippines receiving income from sources within or outside the Philippines
• Filipino citizens not residing in the Philippines receiving income from sources within the Philippines
• Resident or non-resident aliens receiving income from sources within the Philippines

categories of income

• Income from salaries/profession
• Income from other sources like interest, dividend
• Income from business
• Income from house property
• Capital gains

Tax Rates

For individuals earning purely compensation income and those engaged in business and practice of profession, the applicable income tax table is as follows:

TAXABLE	INCOME	TAX RATE
More than	But less than
0	P10,000	5%
P10,000	P30,000	P500 + 10% of the Excess over P10,000
P30,000	P70,000	P2,500 + 15% of the Excess over P30,000
P70,000	P140,000	P8,500 + 20% of the Excess over P70,000
P140,000	P250,000	P22,500 + 25% of the Excess over P140,000
P250,000	P500,000	P50,000 + 30% of the Excess over P250,000
P500,000		P125,000 + 32% of the Excess over P500,000 in 2000 and onward