Quarterly Percentage Tax under Sections 116 to 126 of the Tax Code, as amended

BIR Form 2551Q - Quarterly Percentage Tax Return

Who are required to file?

Persons refer to individuals and non-individuals, which include, but are not limited
to, estates, trusts, partnerships, and corporations:

1. Persons, who are not VAT-registered, who sell goods, properties or services,
whose annual gross sales and/or receipts do not exceed three million pesos
(Php3,000,000.00) and are exempt from value-added tax (VAT) under Section 109
(BB) of the National Internal Revenue Code, as amended by Republic Act (RA)
No. 10963. Provided, beginning Jan 1, 2019, cooperatives and self-employed and
professionals with total annual gross sales/receipts not exceeding P500,000 shall
be exempted from the 3% gross receipts tax.

2. Persons engaged in the following industries/transactions: who lease residential

units where the monthly rental per unit exceeds fifteen thousand pesos
(Php15,000.00) but the aggregate of such rentals of the lessor during the year does
not exceed three million pesos (Php3,000,000.00).

A. Cars for rent or hire driven by the lessee, transportation contractors,

including persons who transport passengers for hire, and other domestic
carriers by land for the transport of passengers (except owners of bancas and
owners of animal-drawn two-wheeled vehicle) and keepers of garages.

B. International air/shipping carriers doing business in the Philippines on

their gross receipts derived from transport of cargo from the Philippines
to another country.

C. Franchise grantees of –
i. Radio and/or television broadcasting companies whose annual gross
receipts for the preceding year do not exceed Php 10,000,000.00 and
did not opt to register as VAT taxpayers, and – 3%
ii. Gas and water utilities. – 2%

D. Overseas dispatch, message or conversation transmitted from the

Philippines by telephone, telegraph, tele-writer exchange, wireless and other
communication equipment services is 10% of its gross receipts, except those
transmitted by:

i. The Philippine Government or any of its political subdivisions or

instrumentalities;
ii. Diplomatic services; (embassy or any consular offices of a foreign
government);
 iii. Public international organizations or any of their agencies based in the
Philippines enjoying privileges, exemptions and immunities which the
Philippine Government is committed to recognize pursuant to
international agreement; and
iv. News services for messages which deal exclusively with the collection of
news items for, or the dissemination of news item through, public press,
radio or television broadcasting or a newsticker service furnishing a
general news service similar to that of the public press.

NOTE: These taxes shall be payable by the person paying for the services
rendered and shall be paid to the person rendering the services who is required to
collect and pay the tax within 20days after the end of each quarter.

E. Banks, non-bank financial intermediaries performing quasi-banking

functions derived from the Philippines.

Interest, commissions, and discounts from lending activities, financial

leasing, on the basis of remaining maturities of instruments:
5yr or less – 5%
More than 5years – 1%

Dividends and equity shares in net income of subsidiaries – 0%

Royalties, rentals of property (real or personal), profits from exchange and

all other items treated as gross income – 7%

Net trading gains within taxable year on foreign currency, debt securities,
derivatives and other similar financial instruments – 7%

F. Other non-bank financial intermediaries (including pawnshops as clarified

under Revenue Regulations [RR] No. 10 – 2004)

Interest, commissions, and discounts from lending activities, financial leasing,

on the basis of remaining maturities of instruments:
5yr or less – 5%
More than 5years – 1%

G. Person, company or corporation (except purely cooperative companies or

associations) doing life insurance business in the Philippines. - 2% of the
total premium collected.

Taxable premiums shall not include:

a. Premiums refunded within 6months after payment on account of
rejection or returned for any other reason.
b. Reinsurance by a company hat has already paid the tax
c. Premiums collected by a domestic corporation doing business outside
 the Philippines on account of any life insurances of the insured who is a
nonresident.

H. Fire, marine or miscellaneous agents of foreign insurance companies –

4%

If owners of property obtain insurance directly with foreign companies, the

foreign companies must report it to the insurance commissioner and shall pay the
tax of 5%.

I. Amusement Taxes:

Proprietor, lessee or operator of cockpits – 18%

Cabarets and night or day clubs – 18%,

Boxing exhibitions – 10%, Except: World or Oriental Championships in

any division is at stake be exempt and at least 1 contenders is a citizen of the
Philippines and exhibition are promoted by a citizen of the Philippines or by a
Corporation with at least 60% capital owned by Filipinos.

Professional basketball games – 15%. In lieu of all other percentage taxes

Jai-Alai and racetracks – 30%

Also includes videoke bars, karaoke bars, karaoke televisions, karaoke boxes and
music lounges as clarified under Revenue Memorandum Circular (RMC) No. 18 –
2010

Winnings or 'dividends' in horse races – 10%

In case of winnings from double, forecast/quinella and trifecta bets – 4%

Owners of winning horses – 10%

How to file/pay?

Documentary Requirements

BIR Form 2551Q - Quarterly Percentage Tax Return Form

1. Duly issued Certificate of Creditable Tax Withheld at Source (BIR Form 2307), if
applicable
2. Duly approved Tax Debit Memo, if applicable
3. For amended return, proof of payment and the return previously filed
4. Authorization letter, if filed by an authorized representative
 5. Copy of Certificate of Registration issued by Cooperative Development Authority
for cooperatives, and from the National Electrification Administration for electric
cooperatives

When to File/Pay
 Within twenty-five (25) days after the end of each taxable quarter.

Except:
 If person is retiring from a business subject to percentage tax shall file and pay the
tax due - within 20days after closing of his business.
 If VAT registration is cancelled – Date of cancellation

Where to File

 in the place of business or principal place of business, as the case may be:
a) Authorized agent bank,
b) Revenue district officer,
c) Collection agent, or
d) Authorized Treasurer (City/Municipality).

NOTE: AT the option of the Taxpayer, he can file return for each branch or place of
business or a consolidated return for all branches with the RDO where said business
or principal place of business is located.

Determination of correct sales/receipts

1) When applicable:
a) Person failed to issue receipts/invoices;
b) No return was filed, or
c) There's reason to believe that the books don't correctly reflect the declarations
made/to be made in the return

2) How determined: Commissioner prescribes a minimum amount (of the taxable

base), taking into account the sales/receipts/other taxable base, and other relevant
information of another--
a) Doing a similar business,
b) Under similar circumstances.
 Quarterly Percentage Tax Rates Table

Coverage Taxable Base Tax

Rate
Non-VAT registered persons under Section Gross sales or receipts 3%
109 (BB)
Domestic carriers and keepers of garages Gross receipts 3%
International air/shipping carriers doing Gross receipts on transport of cargo 3%
business in the Philippines from the Philippines to a foreign
country
Franchise grantees: 2%
Gas and water utilities 3%
Radio and television broadcasting companies Gross receipts
whose annual gross receipts of the preceding
year do not exceed Php10,000,000 and did Gross receipts
not opt to register as VAT taxpayer

Overseas dispatch, message or conversation Amount paid for the service 10%
originating from the Philippines
Banks and non-bank financial intermediaries Interest, commissions and discounts from
performing quasi-banking functions lending activities as well as income from
financial leasing, on the basis of remaining
maturities of instruments from which receipts
are derived:
• If maturity period is five years 5%
or less
• If maturity period is more than 1%
five years
Dividends and equity shares and 0%
net income of subsidiaries
Royalties, rentals of property, real 7%
or personal, profits from exchange
and all other items treated as gross
income under Sec. 32 of the Tax
Code, as amended
Net trading gains within the taxable 7%
year of foreign currency, debt
securities, derivatives and other
similar financial instruments
Other non-bank financial intermediaries Interest, commissions, discounts 5%
and all other items treated as gross
income under the Tax Code, as
amended
Interest, commissions, discounts from lending
activities, as well as income from financial
 leasing on the basis of remaining maturities of
instruments from which such receipts are
derived:
• If maturity period is five years 5%
or less
• If maturity period is more than 1%
five years
Life Insurance Company/Agent/Corporation Total premiums collected 2%
(except purely cooperative companies or
associations)

Agents of foreign insurance companies (except reinsurance premium):

Insurance agents authorized under the Total premiums collected 4%
Insurance Code to procure policies of
insurance for companies not authorized to
transact business in the Philippines
Owners of property obtaining insurance Total premiums paid 5%
directly with foreign insurance companies
Proprietor, lessee or operator of the following:
Cockpits Gross receipts 18%
Cabarets, Night or Day Clubs, videoke bars, Gross receipts 18%
karaoke bars, karaoke televisions, karaoke
boxes and music lounges
Boxing exhibitions (except when the World Gross receipts 10%
or Oriental Championship is at stake in any
division, provided further that at least one of
the contenders for World Championship is a
citizen of the Philippines and said exhibitions
are promoted by a citizen/s of the Philippines
or by a corporation/ association at least 60%
of the capital of which is owned by said
citizen/s)

Professional basketball games (in lieu of all Gross receipts 15%

other percentage taxes of whatever nature
and description)
Jai-alai and race track Gross receipts 30%
Winnings on horse races  Winnings or 'dividends' 10%
 Winnings from double 4%
forecast/quinella and trifecta
bets
 Prizes of owners of winning 10%
race horses
Percentage Tax for Transactions Involving Shares of Stocks under Section 127 of
the Tax Code, as amended

BIR Form 2552 - Percentage Tax Return for Transactions Involving Shares of Stocks
Listed and Traded Through The Local Stock Exchange or Through Initial and/or
Secondary Public Offering

Who are required to file?

1. Every stock broker who effected a sale, barter or exchange of shares of stock
listed and traded through the local stock exchange other than the sale by a dealer
in securities, which tax shall be paid by the seller/transferor.

2. A corporate issuer, engaged in the sale, exchange or other disposition through

Initial Public Offering (IPO) of shares of stock in closely-held corporations.

3. A stock broker who effected a sale, exchange or other disposition through

secondary public offering of shares of stock in closely-held corporations

How to file/pay?

Documentary Requirements

BIR Form 2552 - Percentage Tax Return for Transactions Involving Shares of Stocks

1. Duly issued Certificate of Creditable Tax Withheld at Source (BIR Form 2307), if
applicable
2. Proof of Exemption for transactions not subject to tax, if applicable
3. Duly approved Tax Debit Memo, if applicable
4. For amended return, proof of payment and the return previously filed
5. Authorization letter, if filed by an authorized representative

When to File/Pay
1. For tax on sale of shares of stocks listed and traded through the local stock
exchange (LSE):
a. Within five (5) banking days from the date of collection.
b. Every Monday, submit to Secretary of stock exchange a declaration
stating:
i. All transactions, and
ii. Taxes collected and turned over to the BIR

2. For tax on shares of stocks sold or exchanged through primary offering - within
30 days from the date of listing in the LSE.

3. For tax on shares of stocks sold or exchanged through secondary public offering -
within five (5) banking days from the date of collection. (same with No. 1)
Note: Aside from BIR Form No. 2552, a stockbroker or corporate issuer is also required
to submit a true and complete return to the Secretary of the Stock Exchange of which he
is a member. The said return shall contain a declaration of all transactions effected
through him during the preceding week and of taxes collected by him and turned over to
the BIR

Percentage Tax for Transactions Involving Shares Rates Table

Coverage Basis Tax Rate

Sale, barter, exchange or other disposition of Gross selling price or 6/10 of
shares of stock listed and traded through the gross value in money 1%
Local Stock Exchange other than the sale by a
dealer of securities – paid by the seller or
transferor
Sale, barter or exchange or other disposition Gross selling price or gross value in
through: money
Initial Public Offering (IPO) – the
issuing corporation shall pay the imposed tax Proportion of disposed shares to total
Secondary Public Offering – the seller outstanding shares after the listing in
shall pay the imposed tax the local stock exchange:
Up to 25% 4%
Over 25% but not 2%
over 33 1/3%
Over 33 1/3% 1%