Su aplicación en relación con el principio de culpabilidad

DEFINITION OF EACH KIND OF TAXPAYER

Taxpayer- any person subject to tax imposed by Title II of the Tax Code [Sec. 22(N), NIRC]. Person- means an individual, a trust, estate or corporation [Sec. 22(A), NIRC].

For income tax purposes, taxpayers are classified generally as follows:

(1) Individuals; (2) Corporations; (3) Partnerships; and (4) Estates and Trusts.

PAGE 31 Primary Classification Sub-Classification(s) Individuals Citizens of the Philippines Residents citizens Non-resident citizens Aliens Residents Non- residents Engaged in Trade or Business in the Philippines Not Engaged in Trade or Business in the Philippines Special Classes of

Individuals Minimum Wage Earner

Corporations Domestic Corporations Foreign Corporations Resident Corporations Non-resident Corporations Estates and Trusts

Partnerships General Business Partnership _{General Professional Partnership} Co- ownerships INDIVIDUAL TAXPAYERS Citizens (1) Resident Citizens (RC) (2) Non-resident Citizens (NRC)

(a) Citizen of the Philippines who establishes to the satisfaction of the Commissioner the fact of his physical presence abroad with a definite intention to reside therein.

(b) Citizen who leaves the Philippines during the taxable year to reside abroad, either as an immigrant or for employment on a permanent basis.

(c) Citizen of the Philippines who works and derives income from abroad and whose employment thereat requires him to be physically present abroad most of the time during the taxable year.

(d) Citizen previously considered as non- resident citizen and who arrives in the Philippines at any time during the taxable year to reside permanently in the Philippines  Treated as NRC with respect to his income derived from sources abroad until the date of his arrival in the Philippines

Aliens

(1) Resident Alien

An alien actually present in the Philippines who is not a mere transient or sojourner is a resident for income tax purposes.

No/Indefinite Intention = RESIDENT: If he lives in

the Philippines and has no definite intention as to his stay, he is a resident. A mere floating intention indefinite as to time, to return to another country is not sufficient to constitute him a transient.

Definite Intention = TRANSIENT: One who comes

to the Philippines for a definite purpose, which in its nature may be promptly accomplished, is a transient.

Exception: Definite Intention but such cannot be promptly accomplished; If his purpose is of such

nature that an extended stay may be necessary for its accomplishment, and thus the alien makes his home temporarily in the Philippines, then he becomes a resident.

(2) Non-resident Alien

Engaged in trade or business within the Philippines - If the aggregate period of his stay in the Philippines is more than 180 days during any calendar year.

Not engaged in trade or business within the Philippines - If the aggregate period of his stay in the Philippines does not exceed 180 days.

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Special class of individual employees Minimum Wage Earner

(a) A worker in the private sector paid the statutory minimum wage;

(b) An employee in the public sector with compensation income of not more than the statutory minimum wage in the non-agricultural sector where he/she is assigned.

Corporations

 Includes all types of corporations, partnerships (no matter how created or organized), joint stock companies, joint

accounts, associations, or insurance

companies, whether or not registered with the SEC.

 Excludes general professional partnerships

(GPP), joint venture or consortium formed for the purpose of undertaking construction projects, joint venture or consortium engaging in petroleum, coal, geothermal and other energy operations pursuant to an operating or consortium agreement under a service contract with the government. (1) Domestic corporations – A corporation

created and organized under its laws (the law of incorporation test).

(2 )Foreign corporations – A corporation which is not domestic.

(a) Resident foreign corporations – Foreign corporation engaged in trade or business within the Philippines.

Doing business – The term implies a

continuity of commercial dealings and arrangements, and contemplates, to that extent, the performance of acts or works or the exercise of some of the functions normally incident to, and in progressive prosecution of commercial gain or for the purpose and object of the business organization. [RA 7042, Foreign Investments Act]

In order that a foreign corporation may be regarded as doing business within a State, there must be continuity of conduct and intention to establish a continuous business, such as the appointment of a local agent, and not one of a temporary character [CIR v. BOAC]

(b) Non-resident foreign corporations – Foreign corporation not engaged in trade or business within the Philippines (3) Joint venture and consortium – Essential

factors of a joint venture or consortium: (a) Each party must make a contribution,

not necessarily of capital but by way of services, skill, knowledge, material or money;

(b) Profits must be shared among the parties;

(c) There must be a joint proprietary interest and right of mutual control over the subject matter of the enterprise; (d) There is a single business transaction.

Partnership

The Tax Code mandates that every other type of business partnership is subject to income tax in the same manner and at the same rate as an ordinary corporation.

General Professional Partnerships (GPP)

A general professional partnership is a partnership formed by persons for the sole purpose of exercising their common profession, no part of the income of which is derived from engaging in any trade or business.

Not considered as a taxable entity for income tax purposes. The partners themselves are liable, not the partnership, are liable for the payment of income tax in their individual capacities.

Estates and Trusts

Taxable estates and trusts are taxed in the same manner and on the same basis as an individual.

Co-ownership

For income tax purposes, the co-owners in a co- ownership report their share of the income from the property owned in common by them in their individual tax returns for the year and the co- ownership is not considered as a separate taxable entity or a corporation.

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INCOMETAXATION