Classification of Taxable Corporations
I. Special Corporations
These are corporations specifically identified and enumerated under the NIRC, which are subject to the
special/ preferential corporate income tax rules and tax rates.
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Proprietary Educational Institution
Non- Profit Hospital
Regional Operating Headquarter of Multinational Corporation
Non-resident Cinematographic Film Owner, Lessor, Distributor
Resident International Carrier
Non-resident Owner/Lessor of Vessels Chartered by Philippine Nationals
Non-resident Owner and Lessor of Aircraft, Machinery, and other Equipment.
Non-resident foreign corporation/ partnership in general
II. Ordinary Corporations
These are corporations which are not listed among the special corporations. These entities are required
to file their corporate income tax returns because they are subject to the basic income tax rules.
A. Domestic Corporation
A corporation which is organized in the Philippines or under its corporation laws.
B. Foreign Corporation
It is corporation organized, authorized, or existing under the laws of any foreign country.
1. Resident Foreign Corporation
a corporation engaged in trade or business in the Philippines.
2. Non- Resident Foreign Corporation
a corporation not engaged in trade or business in the Philippines.
The following items are, among others, deemed income from sources within the Philippines:
1. Interests;
2. Dividends;
3. Compensation for labor or personal services performed in the Philippines;
4. Rentals and Royalties from property located in the Philippines or from any interest in such
property, including rentals or royalties for:
• The use of or the right or privilege to use in the Philippines any copyright, patent, design
or model, plan, secret formula or process, goodwill, trademark, trade brand or other like property
or right;
• The use of, or the right to use in the Philippines any industrial, commercial or scientific
equipment;
• The supply of scientific, technical, industrial or commercial knowledge or information;
• The supply of any assistance that is ancillary and subsidiary to, and is furnished as a
means of enabling the application or enjoyment of, any such property or right as is
mentioned in paragraph (a), any such equipment as is mentioned in paragraph (b) or any
such knowledge or information as is mentioned in paragraph (c);
• The supply of services by a nonresident person or his employee in connection with the
use of property or rights belonging to, or the installation or operation of any brand,
machinery or other apparatus purchased from such nonresident person;
• Technical advice, assistance or services rendered in connection with technical
management or administration of any scientific, industrial or commercial undertaking,
venture, project or scheme; and
• The use of or the right to use:
✓ Motion picture films;
✓ Films or video tapes for use in connection with television; and
✓ Tapes for use in connection with radio broadcasting.
• Gains, profits and income from the sale of real property located in the Philippines; and
• Gains, profits and income derived from the sale within the Philippines of personal
property.
• However, gains from the sale of shares of stock in a domestic corporation shall be
treated as derived from sources within the Philippines regardless of where said shares are
sold.