BIR Ruling

January 17, 1969 Mr. Catalino Nuval 1137-B Vermont St. Malate, Manila S i r : This refers to your letter dated September 28, 1968 requesting information on the following queries: cdt "1. Supposing that a Filipino resident in the United States is already an American Citizen, is he still required to file an income tax return with the Philippine Government? "2. If a Filipino resident in the United States is already filing his income tax return with the United States Government and paying his income tax with that government, does he still have to do the same with the Philippine Government?" In reply, I have the honor to inform you that a Filipino resident in the United States who has already acquired American citizenship is no longer required to file an income tax return with the Philippine Government, except when he is engaged in trade or business within the Philippines, in which case, his entire net income received from all sources within the Philippines shall be returnable and subject to Philippine income tax at the same rate of tax imposed on citizens or residents of the Philippines under Section 21 of the Tax Code, as amended by Republic Act No. 5325. If the said naturalized American citizen is not engaged in trade or business within the Philippines but receives income from sources therefrom, his entire income shall be subject to income tax under Section 22(b) of the Tax Code, as amended. A Filipino citizen in the United States, receiving income and paying income tax therein, is nevertheless required to file Philippine income tax return. This income tax paid by him in the United States can be credited against the Philippine income tax if he signifies in his return his desire to avail of the benefit of such tax credit. If, however, he does not signify in his return his desire to have to any extent the benefits of paragraph (3) of Section 30(c) of the National Internal Revenue Code, then the tax paid by him in the United States is deductible from his gross income in the Philippines. (Section 30(c)(1)(B), Revenue Code) casia Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue