Business and professional income – Earnings from running a business or practicing a profession, including profits from the sale of assets, commissions, service fees, professional fees, rental income, and other incomes not covered by compensation incomeĬ. Compensation income – Earnings from an employer-employee relationship, including salaries (plus any overtime pay, holiday pay, or night differential pay), fees, commissions, honoraria, taxable bonuses and allowances, and other benefitsī. While that definition appears too generic, the BIR website provides specific examples of what constitutes gross income:Ī. Under the tax code 1, gross income means all income derived from whatever source. Gross income is the starting point of computing a taxpayer’s income tax due. Is the 13th-month pay taxable under the TRAIN law? How is tax refund calculated in the Philippines? Is there a tax refund in the Philippines?
TAX TABLES 2021 HOW TO
What is Minimum Corporate Income Tax (MCIT) and how to compute it? Which should I choose: itemized deduction or optional standard deduction? Under itemized deduction, what are the specific expenses I can deduct from my gross income? Should I file income tax under the 8% special rate or the graduated rates?
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Scenario 1: Employee with a gross monthly salary of Php 30,000 and receiving 13th-month pay of the same amount.Sample income tax computation (for the taxable year 2020).How To Compute Your Income Tax Based on Graduated Rates.
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Graduated income tax rates for Januand onwards Graduated income tax rates until December 31, 2022 What Can Be Deducted From Gross Income?.