Filipino Overseas Workers are Subject to the Withholding on Wages

September 11, 1981 BIR RULING NO. 177-81 91-00 000-78 177-81 Zamboanga Realty & Development Corporation 2nd Floor, Maligaya Building 2 877 E. de los Santos Avenue Quezon City Attention: Ms . Florida R . Bauto Treasurer & General Manager M a d a m : This refers to your letter dated August 22, 1980 requesting for a ruling on whether or not contractual Filipino overseas workers are subject to the expanded withholding tax under Revenue Regulations No. 13-78, as amended by Revenue Regulations No. 6-79 implementing Presidential Decree No. 1357 (now Section 53(f), Tax Code). It is represented that you are a domestic corporation presently engaged in overseas construction project in the State of Kuwait, employing Filipino skilled manpower. In reply thereto, I have the honor to inform you that our internal revenue laws bearing on withholding tax on wages found in Charter XI, Title II, Tax Code (not the expanded withholding tax under Section 53(f) of the Tax Code) are applicable if the employer is a domestic corporation, and the employees are Filipino citizens, even if their wage income is derived from service rendered abroad. Accordingly, the salaries paid to your Filipino overseas workers are subject to the withholding on wages. cdti In the light of the foregoing, you are constituted as the withholding agent of the government and is therefore under obligation to deduct and withhold the corresponding income tax in accordance with the withholding tax table prescribed by Revenue Regulations No. V-8, as amended. (Section 91, Tax Code). Very truly yours, RUBEN B. ANCHETA Acting Commissioner