Category Archives: Tax and Estate Law

Implementation of Higher Cap (P82,000) for Tax-Exempt Bonuses and Other Benefits

There is a new cap for the exemption of bonuses and other benefits, from the former amount of P30,000. Under Republic Act (RA) No.10653, signed into law in 2015, gross benefits received by officials and employees of public and private entities up to a maximum amount of Eighty Two Thousand Pesos (P82,000) are excluded from the computation of the gross income of the recipients of such benefits, and thus, such amounts are exempt from income tax. To implement RA 10653, the Bureau of Internal Revenue (BIR) issued Revenue Regulations (RR) 3-2015. Here’s a briefer of RR 3-2015. Continue reading

New Law Increasing the Exemption for 13th Month Pay and Other Benefits (Republic Act 10653)

Republic of the Philippines
Congress of the Philippines
Metro Manila

REPUBLIC ACT NO. 10653

AN ACT ADJUSTING THE 13TH MONTH PAY AND OTHER BENEFITS CEILING EXCLUDED FROM THE COMPUTATION OF GROSS INCOME FOR PURPOSES OF INCOME TAXATION, AMENDING FOR THE PURPOSE SECTION 32(B), CHAPTER VI OF THE NATIONAL INTERNAL REVENUE CODE OF 1997, AS AMENDED

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Changes in the Application and Issuance of Importer’s Clearance Certificate (ICC), Broker’s Clearance Certificate (BCC)

A number of our importer-clients have been complaining about the Manila City port congestion and the apparent lack of communication between the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BoC) when it comes to the requirements relating to the Importer’s Clearance Certificate (ICC) and Broker’s Clearance Certificate (BCC). A welcome development is the issuance of Revenue Memorandum 1-2015 (summary and full text below).  Continue reading

Primer on the Tax Amnesty Act of 2007 (RA 9480)

What is Republic Act No. 9480?

It is a law, referred to as the “Tax Amnesty Act of 2007” passed by Congress granting amnesty to all unpaid internal revenue taxes imposed by the national government for the taxable year 2005 and prior years.

Until when can taxpayers avail of the benefits of this law?

The last day to avail of tax amnesty is 5 May 2008, as clarified in Department of Finance (DOF) Department Order No. 11-08. Continue reading

Last Will and Testament: Basic Discussion

The settlement of a person’s estate after his/her death, based on our experience, is potentially one of the more bitter litigations. It’s never good to see relatives fighting each other. Some persons, with the intent of controlling the disposition of his/her properties after his/her death (and hopefully prevent fighting among his/her heirs over the properties left), prepare a “last will and testament”. Let’s have a brief discussion on this matter. Continue reading

Withdrawal of exemptions to pay local taxes: The TELCO cases

SC newsflash: SC Holds DIGITEL Accountable to Pangasinan for Local Taxes. The Supreme Court recently found Digital Telecommunications Philippines, Inc. (DIGITEL) liable to the Province of Pangasinan for the payment of provincial franchise and real property taxes. The SC affirmed the ruling of the lower court that the tax exemption in Republic Act (“R.A.”) No. 7925, the Public Telecommunications Policy Act of the Philippines, stating that any advantage, favor, privilege, exemption, or immunity granted under existing franchises, or may hereafter be granted, shall be made part of previously enacted franchises and made automatically applicable to the grantees thereof, does not work to exempt DIGITEL from payment of provincial franchise and real property taxes.

Unfortunately, as of this writing, the decision in that case (GR No. 152534, Digital Telecommunications Philippines, Inc. v. Province of Pangasinan, 23 February 2007) is not yet posted at the SC website. So, let’s discuss the case cited in that DIGITEL decision – PLDT vs. City of Davao, et al. Continue reading

Basic concepts in estate proceedings and estate tax

Among the inescapable facts in life, something which everyone shares regardless of status, race, sex or creed, is death. A person may leave properties (or liabilities) upon death, so a discussion on the basic concepts on estate proceedings is in order.

Inheritance – Inheritance includes all the property, rights and obligations of a person which are not extinguished by his death. (Civil Code, Art. 776) Continue reading