Log inSign up
Republic Act
Approved June 22, 1963

Republic Act No. 3825

An act to amend certain sections of commonwealth act numbered four hundred sixty-six, otherwise known as the national internal revenue code, and for other purposes.

AN ACT TO AMEND CERTAIN SECTIONS OF COMMONWEALTH ACT NUMBERED FOUR HUNDRED SIXTY-SIX, OTHERWISE KNOWN AS THE NATIONAL INTERNAL REVENUE CODE, AND FOR OTHER PURPOSES.

In plain language

This Act amends specific provisions of the National Internal Revenue Code to impose a 30% tax on foreign corporations for income earned within the Philippines, including interest, dividends, rents, salaries, wages, premiums, annuities, compensations, remunerations, emoluments, or other fixed or determinable gains, and mandates a 30% withholding tax on such income.

  • Amends Section 24(b) to tax foreign corporations 30% of certain income earned within the Philippines.
  • Amends Section 54 to impose a 30% withholding tax on foreign corporations that do not engage in trade or business within the Philippines and have no office there.
  • Excludes reinsurance premiums from the tax and withholding requirements.
tax law
foreign corporations
Philippines
NIRC

REPUBLIC ACT No. 3825

AN ACT TO AMEND CERTAIN SECTIONS OF COMMONWEALTH ACT NUMBERED FOUR HUNDRED SIXTY-SIX, OTHERWISE KNOWN AS THE NATIONAL INTERNAL REVENUE CODE, AND FOR OTHER PURPOSES.

Section 1

Subparagraph (1), paragraph (b) of Section twenty-four of the National Internal Revenue Code, as amended, is further amended to read as follows:

(b)Tax on foreign corporation.
(1)Non-resident corporations. There shall be levied, collected, and paid for each taxable year, in lieu of the tax imposed by the preceding paragraph, upon the amount received by every foreign corporation not engaged in trade or business within the Philippines, for all sources within the Philippines, as interest, dividends, rents, salaries, wages, premiums, annuities, compensations, remunerations, emoluments, or other fixed or determinable annual or periodical gains, profits, and income, a tax equal to thirty per centum of such amount: Provided, however, That premiums shall not include reinsurance premiums.

Section 2

Section fifty-four of the National Internal Revenue Code, as amended, is hereby further amended to read as follows:

Sec. 54. Payment of corporation income tax at source. In the case of foreign corporations, subject to taxation under this Title not engage in trade or business within the Philippines and not having any office or place of business therein, there shall be deducted and withheld at the source in the same manner and upon the same items as is provided in Section fifty-three a tax equal to thirty per centum thereof, and such tax shall be returned and paid in the same manner and subject to the same conditions as provided in that section: Provided, however, That no such deduction or withholding shall be required in the case of reinsurance premiums ceded to foreign insurance corporations not engaged in trade or business in the Philippines and having no office or place of business therein.

Section 3

This Act shall take effect upon its approval.

Approved: June 22, 1963.

For information and research only, and not legal advice. This text may not reflect later amendments. For certified copies, refer to the Official Gazette or the issuing agency.