Income Tax of Non-Resident Filipino Citizens

March 30, 1973 BIR RULING NO. 011-73 Income tax of non-resident Filipino citizens . One income derived from sources within the Philippines, non-resident Filipino citizens are subject to the progressive rates of income tax imposed by Section 21 of the Tax Code, as amended by Presidential Decree No. 69 ranging from 3% upon the amount by which the taxable net incomes does not exceed P2,000 and rising gradually to 70% upon the amount by which the taxable net income exceeds P500,000, while on their income from all sources without the Philippines, they shall pay an income tax on the basis of the gross amount thereof at rates graduated as follows: On the first $6000 1% On the amount exceeding $6000 but not exceeding $20,000 2% On the amount exceeding $20,000 3% Total equals amount of the tax due and payable Thus, a non-resident citizen who earned from sources outside the Philippines, a total gross income of $6,010.00 shall pay an income tax of $60.20, computed as follows: $6000 x .01 (1%) = $60.00 Excess over $6000 $10 x .02 (2%) = 20 Income tax due on $6,010 = $60.20 This computation shall apply to income derived by non-resident Filipino citizens from sources outside the Philippines starting January 1, 1973 (Sec. 12, Presidential Decree No. 69), the corresponding income tax on which is payable at the time of the filing of the return on or before April 15, 1973. Under Section 21 of the Tax Code as amended, non-resident Filipino citizens are those who establish to the satisfaction of the Commissioner of Internal Revenue the fact of their physical presence abroad for an uninterrupted period which includes an entire taxable year.