Republic Act No. 9648 was signed into law by President GMA on June 30, 2009 and applies retroactively to March 20, 2009. This made permanent the 5-year exemption introduced by Republic Act No. 9243 that commenced on May 20, 2004 and ended up on May 20, 2009.

Withholding tax system in the Philippines is quite an interesting topic for those engaged in trade or business, or those in practice of profession. This is a system of advance collection scheme where the approximate income tax of a specific income payment is being deducted and remitted to the BIR. By this, BIR is more assured that income will be declared and reported, thus, this is in the form of a check and balance.

Income refers to all wealth which flows to the taxpayer other than a mere return of capital. It is a flow wealth that goes into the taxpayer within a specified time, arising from the use of capital, use of labor through either physical and/or intellectual faculties, or from other sources where after the transaction, the taxpayers becomes more wealthier than before the transaction.

Under our property law, donation is an act of liberality whereby a person (called the “donor“) disposes of gratuitously a thing or a right in favor of another (called a “donee“), who accepts it.

In a corporate world, dividends is not a new topic. As a matter of fact, it is one of the major consideration for an investor to purchase shares of stock of a company. It represents the share in the net learning’s distribution in a corporation and could be in the form of cash, property, shares of stocks or and liquidating dividends upon liquidation. How are they taxed, then?

Who would not like to pay a lower tax, or a no tax at all? there is conflicting interest between the government and the taxpayer. The taxpayers always wanted for less while the government bargains for more. Nevertheless, all these shall be within the bounds of the law and regulations. But the question is, how can you save taxes without violating provisions of the law and regulations?