BIR Ruling No. 018-83

1983 BIR RULING NO. 018-83 Gentlemen : This refers to your letter dated September 6, 1982 requesting a ruling, in view of the RP-Singapore Tax Treaty, whether Filipino contract workers in Singapore who are taxed on their income derived in that country are still taxable in the Philippines on the same income. casia In reply, please be informed that said Tax Treaty does not prohibit the Philippines from imposing income tax on Filipino contract workers with respect to their income derived in Singapore. Article 24 (5) of the said Treaty provides: "Nothing in this Convention shall be construed as preventing the Philippines from taxing its citizens in accordance with its legislation." Section 21 (f) of the National Internal Revenue Code, provides that non-resident citizens are subject to income tax upon the adjusted gross income derived by them from all sources without the Philippines. Accordingly, Filipino contract workers in Singapore who are considered non-resident citizens [Sec. 20(e)(2), Tax Code] are subject to Philippine income tax on income derived by them in said country. The tax is withheld in accordance with Section 7, II of Revenue Regulations No. 6-82 entitled "Withholding of tax on compensation of a citizen for services performed outside the Philippines." cd Very truly yours, (SGD.) RUBEN B. ANCHETA Acting Commissioner Bureau of Internal Revenue