Taxes may be one of the most important considerations of investors in deciding whether to continue with the deal or not. To be relieved from the impact of double taxation and prevent fiscal evasion, tax treaties are entered into by different countries.
The Philippine government generally tax income at 30% but the tax rate may be lowered to 10% or the income may be exempt from tax because of the provisions of tax treaties. However, the tax authority requires the filing of the application of tax treaty relief before availment thereof.
Currently, the Philippines has tax treaties with the following countries:
- Czech Republic
- Korea (South)
- New Zealand
- United Arab Emirates
- United States of America
- United Kingdom of Great Britain and Northern Ireland
There are several documentary requirements that the Bureau of Internal Revenue requires before approval of the application, such as proof of residency, articles of incorporation or fact of establishment of the income earner, special power of attorney, certificate of business presence in the Philippines or non-registration, certificate of no pending case and other pertinent documents.
If you need more information on tax treaties or assistance in the application for relief from double taxation, Triple i Consulting has tax lawyers and tax accountants that will help you in this aspect and ensuring that you will not be disqualified because of the technicalities of the laws.