Chapter 1
Succession and Transfer Taxes
According to Civil Code ownership may be
acquired through:
1. Occupation
2. Intellectual Creation
3. Law
4. Donation
5. Tradition
6. Contract
7. Prescription
8. Succession
Transfer taxes
 taxes imposed upon the gratuitous
disposition of private properties or rights
 an excise tax
Types of transfer taxes
1. Estate tax – donation mortis causa/time
of death of donor
2. Donor’s tax – donation inter
vivos/lifetime of both the donor and
donee
Succession – mode of acquisition by virtue of
which, the property, rights, and obligations to
the extent of the value of the inheritance, of a
person are transmitted through his death to
another or others either by his will or by
operation of law
 The
amount
of
obligation
acquired/inherited by an heir should not
be kore than the combined value of the
properties and rights inherited
 Estate tax accrues the date of death of
the decedent and payment of tax is
distinct from the obligation to pay the
same
 Succession takes place at the date of
death of the decedent and the right of
the State to the tax the privilege to
transmit the estate vests instantly upon
death
Kinds of Succession
1. Testamentary or testate succession –
designation of heir; made in a will
executed in the form prescribed by law
2. Legal or interstate succession – effected
by operation of law
3. Mixed succession – partly by will and
partly by operation of law
Causes of Legal Succession or Intestacy
1. If a person dies without a will, or with a
void will, or one which has subsequently
lost its validity
2. When the will does not institute an heir
3. Partial institution of heir (intestacy takes
place as to the undisposed portion)
4. When the heir instituted is incapable of
succeeding
5. Other causes:
a. Non-fulfillment
of
suspensive
condition
b. Preterition – omission of one, some
or all of the compulsory heirs which
has the effect of annulling the
institution of heir
c. Fulfillment of resolutory condition
d. Expiration of term or period of
institution
e. Non-compliance or impossibility of
compliance with the will
f. Repudiation of the instituted heir
Elements of Succession
1. Decedent
2. Inheritance (estate)
3. Successor
a. Compulsory heirs – those who
succeed by force of law to some
portion of the inheritance, in an
amount predetermined by law,
known as the legitime
Kinds of Compulsory Heirs
 Primary – those who have precedence
over and exclude other compulsory heirs
 Secondary – those who succeed only in
the absence of the primary compulsory
heirs
 Concurring – those who succeed
together with the primary or secondary
compulsory heirs
 *insert table
b. Voluntary heirs – those instituted by
the testator in his will to succeed to
the inheritance of the portion
thereof of which the testator can
freely dispose
c. Legal or intestate heirs – those who
succeed the estate of the decedent
by operation of law
Composition of Gross Estate
Legitime 75%
Free portion 25%
Order of Intestate Succession
1. Legitimate children or descendants
2. Legitimate parents or ascendants
3. Illegitimate children or descendants
4. Surviving spouse
5. Brothers and sisters, nephews and
nieces
6. Other collateral relatives within the 5th
degree
7. Stet or the government
Consanguinity – relation of person descending
from the same stock or common ancestors
 Lineal consanguinity – which may be
descending or ascending, is that which
subsists between persons of whom one
is descended in a direct line from the
other
 Collateral consanguinity – which subsists
between persons who have the same
ancestors, but who do not descend one
from the other
Will – an act whereby a person is permitted, with
the formalities prescribed by law, to control to a
certain degree the disposition of his estate to
take effect after his death
Kinds of Wills:
1. Notarial or ordinary or attested will
2. Holographic will
 Probate of a will is a court procedure by
which a will is proved to be valid or
invalid
 Codicil – supplement or addition to a
will, made after the execution of a will
and annexed to be taken as a part
thereof, by which any disposition made
in the original will is explained, added to,
or altered
Disinheritance – testamentary disposition by
which a compulsory heir is deprived of, or
excluded from the inheritance to which he has a
right
Requisites for disinheritance:
1. Effected only through a valid will
2. For a cause expressly stated by law
3. Cause must be stated in the will itself
4. Cause must be certain and true
5. Unconditional
6. Total (no partial disinheritance)
7. The heir disinherited must be designated
in such a manner that there can be no
doubt as to his identity
Chapter 2
Gross Estate
Composition of Gross Estate
Decedent
Gross Estate
1. Property
 Citizen
(real or
 Nonresident
personal)
Citizen
worldwide
 Resident
2.
Intangible
Alien
personal
property
worldwide
1. Real
 Nonresident
property
Alien
situated in
the Phil.
2. Tangible
personal
property
situated in
the Phil.
3. Intangible
personal
property
with situs
in the
Philippines
UNLESS
excluded
bc of
reciprocity
Intangible Assets with Situs “Within” the
Philippines
1. Franchise exercised in the Phil.
2. Shares, obligation or bonds issued by
any corporation or sociedad anonima
organized in the Phil. In accordance with
its laws
3. Shares , obligations, or bonds issued by
any foreign corporation, 85% of the
business of which is located in the Phil.
4. Shares, obligations, or bonds issued by
any foreign corporation if such shares,
obligations or bonds have acquired a
business situs in the Philippines
5. Shares or rights in any partnership,
business or industry established in the
Philippines
Note: Generally, the situs of intangible personal
property is the domicile of the owner (only for
convenience)
Valuation of Gross Estate
1. In General: FMV at time of death
2. Real Property
Higher between:
o FMV Commissioner
o FMV Assessors
3. Personal Property: FMV at time of death
4. Shares of stock
o Unlisted CS: Book Value
o Unlisted PS: Par Value
o Listed Shares: FMV using
arithmetic mean between the
highest and lowest quotation at
the time nearest the DOD
5. Units pf participation in any association,
recreation, or amusement club
o Bid price nearest the DOD
published
6. Right to usufruct, use or habitation, and
annuity
o According to the latest Basic
Standard Mortality Table
Exemptions and Exclusions from the Gross
Estate
A. Exclusions under Section 85 and 104
1. Exclusive property of the surviving
spouse
o GE shall include exclusive
properties
and
common
properties of the decedent
o Capital = exclusive properties of
husband
o Paraphernal
=
exclusive
properties of wife
2. Properties outside the Philippines for
NRA
3. Intangible personal property in the
Philippines of an NRA under Reciprocity
Law
B. Exclusions under Section 87
1. Merger of usufruct in the owner of the
naked title
2. Fideicommisary (1 degree apart)
Elements:
o Substitution must not go beyond
1 degree from orginal heir
o Fiduciary and fideicommissary
must be both living at the time
of testator’s death
3. Transfer under special power of
appointment
4. All bequest devises, legacies or transfers
to social welfare, cultural and charitable
institutions
C. Exclusions under Special Laws
1. Proceeds of life insurance and benefits
from GSIS
2. Accruals an benefits received from SSS
3. Amounts received from Philippines and
US government for war damages
4. Amounts received from US Veterans
administration
5. Payment from the Philippines of US
government to the legal heirs of
deceased of WW2 Veterans
6. Retirement benefits from a private firm
7. Personal Equtiy and Retirement Account
(PERA)
8. Compensation paid to HCW for death
caused by COVID-19
Composition of Gross Estate
 Real Property
 Personal Property
 Intangible Personal Property
 Shares of stock
 Bank deposit
 Dividends declared BEFORE
death but received AFTER death
 Partnership profit which have
accrued before death
 Usufructuary and rights
I.
PROPERTY OWNED ACTUALLY AND
PHYSICALLY PRESENT
a. Decedent’s interest
 Extend of equity or
ownership participation
of the decedent on any
property
physically
existing
II.
III.
PROPERTY NOT PHYSICALLY IN THE
ESTATE BUT ARE SUBJECT TO
ESTATE TAX
a. Transfer in contemplation of
death
b. Revocable transfers
 terms of enjoyment of
property
may
be
altered,
amended,
revoked or terminated
 It is sufficient that he
had the power to revoke
though not exercised
c. Transfers under a General Power
of Appointment
 Donee of a GPA holds
the appointed property
with all the attributes of
ownership
d. Transfers
for
Insufficient
Consideration
1. Consideration vs. FMV @
time of transfer/sale – see if
adequate
2. If
inadequate,
find
difference
between
consideration and FMV @
time of death to be included
in GE
MISCELLANEOUS ITEMS
a. Claims against insolvent persons
 Should be included in
computation of GE
 Claim which is not
collectible should be
allowed as deduction
from GE
 Prorate the payment of
liabs
b. Proceeds of life insurance
1. Must be insurance on life of
decedent
2. Beneficiary must be either:

Estate
or
executore/administrato
r
 Any
third
person
provided
that
the
designation is NOT
IRREVOCABLE
(revocable)
 If silent, revocable
meaning added to GE
Proceeds of Life Insurance
Beneficiary
Designation
GE Inclusion
Estate
R or IR

Executor
R or IR

Administrator
R or IR

3rd Party
R

rd
3 Party
IR
X
ESTATE TAX RATE
 Net estate whether resident or nonresident shall be subject to an estate tax
rate of 6%
Chapter 3
Deductions from Gross Estate
Classification:
1. Ordinary Deductions
2. Special Deductions
3. Share of the surviving spouse, if the
decedent is married
I.
ORDINARY DEDUCTIONS
A. LITe (Losses, Indebtedness, taxes, etc.)
1. Losses
o Pertains to casual losses
Requisites:
o Arising exclusively from acts of
God and man
o Not compensated by insurance
o Not deducted from income tax
return
o Incurred during the settlement
period of the estate (within 1
year from date of death)
2. Indebtedness or Claims against
estate
Requisites:
o Personal obligation existing at
the time of death (not after
death)
o Contracted in good faith and for
adequate and full consideration
o Debt or claim is valid in law and
enforceable in court
o Debt must not be condoned by
creditor
Substantiation Requirements:
In case of simple loan
a. Duly notarized debt instrument
b. Duly notarized Certification of
the creditor
c. Proof of financial capacity of the
creditor to lend
d. Statement under oath executed
by the administrator or executor
of the estate reflecting the
disposition of the proceeds of
the loan if said loan was
contracted within 3 years prior
to the death of the decedent
If unpaid obligation arose from
purchase
a. Pertinent documents evidencing
purchase
b. Duly notarized Certification
from the creditor as to the
unpaid balance of the debt
c. Certified true copy of the latest
audited BS of the creditor
d. Pertinent documents filed with
the Court evidencing the claims
against the estate
UNPAID
MORTGAGES
OR
INDEBTEDNESS ON PROPERTY
o Deductions allowed when a
decedent
leaves
property
encumbered by a mortgage or
indebtedness contracted in
good faith and for adequate and
full consideration
o
GE must include the FMV of
property encumbered in order
to be deducted
o
ACCOMMODATION LOAN
o Where loan proceeds went to
another person, the value of the
unpaid loan must be included as
a receivable of the estate
3. Taxes
o Unpaid taxes that accrued prior
to the death of the decedent
o Not allowed as deduction:
 Income tax on income
received AFTER death
 Property taxes accrued
AFTER death
 Estate tax
4. Claims Against Insolvent Persons
Requisites: (judicial declaration NOT
required)
o Incapacity of the debtor
o Full amount owed by the
insolvent must first be included
in the decedent’s gross estate
o and the amount uncollectible
shall be allowed as deduction
o Insolvent could only pay partial
amount, the full amount owed
shall be included in GE and the
amount
uncollectible
be
allowed as deductions
o
o
B. TRANSFER FOR PUBLIC USE (TFPU)
o Dispositions in a last will and
testament or transfers to take
effect after the death in favor of
the
government
of
the
Philippines or any of its political
subdivision for exclusive public
purposes
o Allowed as deduction from GE
provided same amount was
included in the computation of
the decedent’s GE
C. VANISHING DEDUCTIONS (PROPERTY
PREVIOUSLY TAXED)
Requisites:
o
o
o
Death of present decedent
within 5 years from the date of
death of prior decedent or date
of gift
Identity of property
Property must be located in the
Philippines
Property must have formed part
of the situated in the Philippines
of the prior decedent
Estate tax on the prior
succession or the donor’s tax on
the gift must have been finally
determined and paid (purpose is
to lessen double taxation)
No
previous
vanishing
deduction on the property
Rates:
Within 1 year
Beyond 1 year – 2
Beyond 2 years – 3
Beyond 3 years – 4
Beyond 4 years – 5
100%
80%
60%
40%
20%
Computation:
VALUE TO TAKE
Lower between
o Gross estate of prior decedent
or gross gift of the donor
o Gross estate of present
decedent
LESS: MORTGAGE PAID (paid by present
decedent from mortgage assumed)
INITIAL BASIS
LESS: Proportional Deduction
Initial Basis/Gross Estate x LIT + TFPU
FINAL BASIS
x Vanishing deduction rate
VANISHING DEDUCTION
II.
SPECIAL DEDUCTIONS
A. STANDARD DEDUCTION
o Citizen or Resident – P5 Million
o Nonresident Alien – P500,000
o The only special deduction
allowed to a NRA decedent
B. FAMILY HOME
o
Allowable as a deduction would
be whichever is lower of P10
Million or the FMV at the time of
the decedent’s death
Limitation:
o Availing of a family home
deduction to the extent
allowable, a person may
constitute only 1 family home
Requisites:
o Decedent was married or if
single, was head of the family
o Family home as well as the land
on which it stand must be own
by the decedent
o Must be the actual residential
home of the decedent and his
family at the time of death
o Allowable deduction must be in
an amount equivalent to the
current FMV of the family or
extent of the decedent’s
interest (if conjugal) whichever
is lower but not exceeding P10
Million
C. AMOUNT RECEIVED BY HEIRS UNDER
RA 4917
o Any amount received by heirs
from the decedent’s employer
as a consequence of the death of
the
decdent-employee,
provided such amount is
included as part of the gross
estate of the decedent
NET SHARE OF THE SURVIVING SPOUSE
 The amount deductible under this
category is the net share of the surviving
spouse in the conjugal partnership
property
 Equivalent to 50% of the conjugal
property after deducting the obligations
chargeable to such property
Chapter 6
Donor’s Tax

A tax levied, assessed, collected, and
paid upon the transfer by any person,
resident or nonresident, of the property
by gift.
 Direct tax & excise tax
 Applies to both natural and juridical
persons
Perfection – moment the donor knows of the
acceptance by the donee
Completion – actual or constructive delivery
ELEMENTS OF DONATION (all must be present)
1. Capacity of the donor to make a
donation
o Must have capacity to contract
and capacity to dispose
(determined at the perfection of
the donation)
2. Donative intent or intent to make a gift
on the part of the donor
o Intent is required only in direct
gifts
3. Delivery
o Applies to completed gift (when
delivered)
INCOMPLETE GIFT
o Because of reserved powers,
becomes complete when either:
 Donor renounces the
power
 Donor’s right to exercise
power ceases because
of the happening of
some
event
or
contingency
4. Acceptance
o Donation is a contract that
requires the meeting of the
minds
o Transfer is perfected the
moment the donor knows of the
acceptance of the donee
PURPOSE OF DONOR’S TAX
1. To prevent avoidance of estate tax
2. To prevent or compensate for the loss of
the progressive rates of income tax
when large estates are split up by gifts to
numerous donees
FORMALITIES
 Donation not in a formal contract is void
Type
Amount
Form
Personal
≤P5,000
Oral or in
Property
writing
>P5,000
In writing
Real Property Any amount
Public
instrument
Acceptance of immovable property
To be valid, immovable property may be
accepted:
 In the same deed of donation
 In a separate public document
CHARACTERISTICS OF DONOR’S TAX
1. Excise tax not a property tax
2. Donor’s tax does not apply if gift is not
completed
3. Perfected the moment the donor knows
of the acceptance by the done
4. Donor’s tax is a direct tax
CLASSIFICATION OF DONATION
1. Simple – cause is pure liberality
2. Renumeratory – due to past services
rendered or future services or charges
3. Modal – consideration is less than the
value of the thing donated
VOID DONATIONS
1. Those made between persons who were
guilty of adultery or concubinage at the
time of the donation
2. Those made between persons found
guilty of the same criminal offense, in
consideration thereof
3. Those made to a public officer or his
wide, descendants, and ascendants by
reason of his office
VALUATION OF GROSS GIFTS
General rule: FMV @ time donated
Property
Valuation
Real Property
HIGHER:
FMV
determined by the
Commissioner and
FMV
fixed
by
assessors (appraised
value not included)
Listed Stocks
Not traded:
 Ordinary
Shares
 Preferred
Shares
Arithmetic
mean
between the highest
and lowest quotation
at the date nearest
the date of death
 Book value
 Par value
DONOR’S TAX RATE
 6% on the basis of the total gifts in excess
of P250,000
GROSS GIFT
 Same rules for estate tax
 Inclusions:
1. Direct gifts
2. Gifts through the creation of trust
3. Transfer for insufficient fund
4. Condonation of debt
5. Repudiation of inheritance
6. Renunciation of the surviving spouse
of share in common property
TRANSFER FOR INSUFFICIENT CONSIDERATION
 EXCEPT for real property subject to CGT
 FMV – Considetion/Selling Price shall be
deemed as a gift
 Fictitious consideration – entire value
shall be subject to donor’s tax
*insert table
Shares of Stock not traded
o Excess of FMV over selling price
shall be treated as a gift subject
to Donor’s tax
CONDONATION
OR
CANCELLATION
OF
INDEBTEDNESS
 Condonation due to rendition of service
– effect of payment compensation
(subject to income tax)
 Condonation was made by a corporation
in favor of its shareholders – effect of
payment of dividend by issuing
corporation (subject to final tax)
PAYMENT OF LOAN BY THE GUARANTOR
General rule: guarantee is gratuitous unless
stated otherwise
Exception: if jointly entered by guarantor and
borrower
REPUDIATION OF INHERITANCE
General rule: “general renunciation” is not
subject to donor’s tax UNLESS:
1. Renunciation was categorically done in
favor of identified heirs; AND
2. To the exclusion or disadvantage of
other co-heirs
Note: if common property is renounced by
spouse it is subject to donor’s tax, however,
renunciation of hereditary estate is subject to
donor’s tax only if the aforementioned are
present
*INSERT DIAGRAM
EXEMPT GIFTS AND/OR DEDUCTIONS FROM
GROSS GIFTS
1. Donations not exceeding P250,000
2. Gifts to or for the use of the National
Government
3. Gifts in favor of non-profit educational
and/or charitable, religious, cultural or
social welfare corporation, institution,
etc. EXCEPT:
o When conducted for profit
o More than 30% is used for
administrative purposes
4. Donations made to entities as exempted
under special laws
5. Encumbrances on the property donated
if assumed by the done
6. Diminutions – decrease in the value of
the donated property as a result of a
condition made by a donor to the done
DONATIONS MADE BY SPOUSES
 Gift from common property – the gift is
taxable one-half to each donor spouse
 Donation between husband and wife
during marriage
General rule: Void
Exception: Moderate gifts
Note: The agreement that the done shall pay the
donor’s tax due is binding only between the
donor and one. It will not bind the BIR.
DONATIONS MADE BY FOREIGN CORPORATION
 Subject to donor’s tax only if property
donated is located in the Philippines


Donation of its own shares is NOT
subject to donor’s tax
Donation of its shares in favor of a
resident employee is not subject to a
donor’s
tax
(employer-employee
relationship)
Chapter 7
Introduction to Business Taxes
Business taxes – those imposed upon onerous
transfers such as sale, barter, exchange and
importation.
 Generally based on gross sales or gross
receipts
“In the course of trade or business” means
regular conduct or pursuit of a commercial or an
economic activity, including transactions
incidental thereto, by any person, regardless of
whether the person engaged therein is a nonstock private organization or government entity.
ISOLATED TRANSACTIONS
Residents – considered not in the ordinary
course of trade or business, thus, not subject to
vat
Nonresidents – considered in the ordinary
course of trade or business, thus subject to FWT
Note: If asset sold is an ordinary asset used in the
business and is an incidental transaction, it is
subject to vat.
Types of Business Taxes
1. Value Added Tax (VAT)
2. Other Percentage Taxes (OPT)
3. Excise Taxes
GR: All sales and services made in the normal
course of trade or business are subject to vat
EX: Exempt under law (may be subject to OPT)
VAT & OPT are mutually exclusive but both can
be subject to excise tax
Business Taxes
SALE of goods/properties/services

VAT, in general

VAT exempt, but OPT

Exempt from BT
Manufac/Import & Sale of Sinproducts, Non-essential

VAT

OPT
VAT
/
x
E
OPT
x
/
E
ExT
x
X
-
VAT
/
x
OPT
x
/
ExT
/
/
I.
VALUE ADDED TAX
Tax on the value added by every seller to the
purchase price or cost in the sale or lease of
goods, property or services in the ordinary
course of trade or business as well as
importation of goods into the Philippines,
whether for personal or business use.
Kinds of VAT
1. VAT on sale of goods or properties
2. VAT on importation of goods
3. VAT on sale of services and use or lease
of properties
Persons Liable
Sale in the Ordinary Course: seller & importer in
the course of his trade or business
Importation: indiv or corpo whether or not made
for trade/business
TRANSFER BY A TAX-EXEMPT ENTITY TO NONETAX EXEMPT ENTITY
- In case of tax free importation of goods
into the Philippines by persons, entities,
or agencies exempt from tax where such
goods
are
subsequently
sold,
transferred, or exchanged in the
Philippines to non-exempt persons or
entities, the purchasers, transferees or
recipients shall be considered the
importers thereof, who shall be liable for
any internal revenue tax on such
importation
MEANING OF THE TERM “GOODS OR
PROPERTIES”
All tangible and intangible objects which are
capable of pecuniary estimation and shall
include:
1. Real properties held primarily for sale to
customers or held for lease in the
ordinary course of trade or business
2. The right or the privilege to use patent,
copyright, design or model, plan, secret
formula or process, goodwill, trademark,
trade brand or other like property or
right
3. The right or the privilege to use motion
picture films, films, tapes, and discs
4. Radio, television, satellite transmission
and cable television time
SALE OF SERVICES
- Performance of services in the
Philippines
- Vat on sale of service is a tax on
payments for services
- Indirect tax which may be passed on to
the customer
- Accrues at the time service fee is
collected
SALE OF REAL PROPERTIES
- Sale of real properties held primarily for
sale to customers or held for lease in the
ordinary course of trade or business of
seller
- Installment sale – installment payment
including
interest
&
penalties
(actual/constructive) subject to vat
Characteristics of Vat
1. Indirect tax where tax shifting is always
presumed
o Burden of the tax is borne by the
final consumer; producers &
suppliers file these VAT returns
o Burden is passed but not the
liability to the BIR
2. Consumption-based
3. Imposed on the value-added in each
stage of production and distribution
process
4. Credit-invoice method value-added tax
BASIS FOR VAT
1. Sale of goods or properties
o Gross Selling Price
o Discount may be deducted if not
dependent upon the happening
of a future event
o Returns are deductible if a
proper credit/credit memo is
given
o Add excise tax to get tax base
2. Sale of service
o Gross Receipts
o Receivables
not
included
although earned (only cash
actual
or
constructively
received)
3. Dealer in securities and lending investors
o Gross Income
o Add other income subject to
basic tax
Note: If vat is not billed separately in the
document of sale, the SP shall be deemed to be
inclusive of vat
GROSS SELLING PRICE
- Total amount of money or its equivalent
- Excise tax, if any, shall form part of the
GSP
- Sale, barter, or exchange subject to vat
shall mean consideration stated in the
sales document or FMV whichever is
higher
- FMV – 1) FMV determined by
Commissioner 2) FMV by provincial/city
assessors
- If GSP is based on FMV it shall be
deemed exclusive of vat
GROSS RECEIPTS
- Total amount of money or its equivalent
representing
contract
price,
compensation, service fee, rental, or
royalty
- Including amount charged for materials
supplied with the services and deposits
applies as payments for services
rendered AND advance payments
actually or constructively received
during the taxable period, excluding vat
- “constructive receipt” when money
consideration or its equivalent is placed
at the control of the person who
rendered the service w/o restriction
VAT REGISTRATION
A. MANDATORY REGISTRATION
1. Gross sales/receipts exceed P3
Million for the past 12 months
(except those vat exempt) or there
are reasons to believe that the gross
sales/receipts for the next 12
months will exceed P3 Million
2. Radio
and/or
television
broadcasting companies whose
annual gross receipts of the
preceding year exceeds P10 Million
(mandatory registration applies
within 30 days from the end of the
taxable year)
3. Person to register as VAT taxpayer
but failed to register
Note: Penalty of non-registration – taxpayer shall
be liable to pay the tax as if he were VAT
registered person but cannot avail of the
benefits of input tax credit for the period he was
not properly registered
B. OPTIONAL REGISTRATION
1. Registering with the RDO and shall
not be allowed to cancel registration
for the next 3 years
2. Franchise grantees of radio and/or
television broadcasting whose
annual gross receipts of the
preceding year does not exceed P10
Million. Once exercises, shall be
irrevocable.
- Shall register not later than 10 days
before the beginning of the calendar
quarter and shall pay the registration fee
unless they have already paid at the
beginning of the year; effective on the
first day of the month following
registration
Power of Commissioner to Suspend Business
Operations
- Suspension/closure for not less than 5
days
1. Failure to issue receipts or invoices
2. Failure to file vat return
3. “Understatement” of taxable sales or
receipts by 30% or more of the correct
taxable sales or receipts for the taxable
quarter
4. Failure of any person to register as
required under the law
II.
OTHER PERCENTAGE TAXES (OPT)
Any person who is not a VAT registered
person and is not exempt from business tax shall
be subject to other percentage taxes.
III.
EXCISE TAXES
Apply to goods manufactured or produced in the
Philippines for domestic sales or consumption or
for any other disposition, and goods imported.
The goods manufactured or imported under this
category are classified as either “sin products” or
“non-essential goods.”
Chapter 10
Excise Taxes