Taxation Final Review Flashcards

A comprehensive set of vocabulary flashcards covering Philippine taxation laws, thresholds, tax rates, and administrative requirements based on the lecture notes.

Standard deduction (Non-citizen decedent)

A deductible expense of $P500,000$ from the gross estate of a non-citizen decedent for deaths occurring on or after January 1, 2018.

TRAIN Law

The short title for RA 10963, also known as the Tax Reform Acceleration and Inclusion Law.

Capital Markets Efficiency Promotion Act (CMEPA)

Known as RA No. 12214, this act took effect on January 1, 2025.

VAT Threshold

The gross annual sales amount of $P3,000,000$ that determines if a business is subject to Value-added tax or Percentage Tax.

Nonresident alien (Stay duration)

An alien who stays in the Philippines for an aggregate period of one hundred eighty ($180$) days or less during any calendar year.

Tax Identification Number (TIN) Registration

The TIN must be registered with the Revenue District Office (RDO) of the place where the business is located.

Fringe Benefit Tax Rate

A tax rate of $35\%$ of the grossed-up monetary value of benefits given to managerial or supervisory employees.

BIR Form No. 23016

The Certificate of Compensation Payment/Tax Withheld for an employee.

Department of Trade and Industry (DTI)

The proper office for the registration of Single Proprietorship businesses.

Donor's Tax Rate

A uniform tax rate of $6\%$ based on the total net gifts in excess of $P250,000$ made during the calendar year.

Creditable Withholding Tax (Government Payments)

Effective January 1, 2021, the VAT withholding on government money payments to contractors or sellers shifted from final to a $5\%$ creditable withholding tax.

BIR Form No. 2303

The Certificate of Registration (COR) issued by the Bureau of Internal Revenue.

8% Income Tax Option

An optional tax rate for self-employed individuals and professionals whose gross sales do not exceed $P3,000,000$, which is in lieu of the graduated income tax rates and the $3\%$ percentage tax.

Standard Deduction (Resident Alien decedent)

A fixed deduction of $P5,000,000$ from the gross estate of a resident alien decedent.

De Minimis Benefits (Rice allowance)

A non-taxable benefit with a maximum ceiling of $P2,500$ per month.

De Minimis Benefits (Clothing allowance)

A non-taxable benefit with a maximum ceiling of $P8,000$ per annum.

De Minimis Benefits (Laundry allowance)

A non-taxable benefit with a ceiling of $P400$ per month.

13th Month Pay Exemption

The maximum amount of 13th month pay and other benefits that is exempt from income tax is $P90,000$.

Oplan Kandado

A BIR program where business operations of non-compliant taxpayers are suspended and establishments are temporarily closed.

Capital Gains Tax (Domestic Shares)

A final tax of $15\%$ on the capital gains realized from the sale, barter, or exchange of shares of stock in a domestic corporation not traded in the stock exchange.

Electronic Certificate Authorizing Registration (eCAR)

A document valid from the date of issuance until it is presented to the concerned Registry of Deeds (ROD).

EOPT Act (Invoices)

Under the Ease of Paying Taxes Act, Sales Invoices are the primary document for all sales, while Official Receipts are considered supplementary documents.

Minimum Corporate Income Tax (MCIT)

A tax based on $2\%$ of the gross income of a domestic corporation (or $1\%$ in certain legislative contexts mentioned in the notes).

Small Taxpayer Classification

Taxpayers with gross sales ranging from $P3,000,000$ to less than $P20,000,000$.