EXCESS MCIT OR MCIT CARRY-OVER

Any excess of the minimum corporate income tax

over the normal corporate income tax shall be carried
forward and credited (deducted) against the regular
income tax for the three succeeding taxable years,
provided, that the RCIT should be higher than the
MCIT in the year to which the excess MCIT is
forwarded.
COMPUTATION:
A domestic corporation which commenced
operations in 2014 provided the following data:
2018 2019 2020
Gross Income P10MP12M P14M
Allowable deductions (9.5M) (12.2M) (12.8M)
Net Income (loss) P500k P(200k) P1.2M

Determine the income tax payable for 2018, 2019 and

2020.
 EXCESS MCIT OR MCIT CARRY-OVER

2018 2020

RCIT or Basic tax (P500k P150,000 Net income P1,200,000

x 30%) Less: 2019 NOLCO (200,000)
MCIT (P10M x 2%) 200,000 Taxable income 1,000,000
Tax Due/payable (Higher P200,000
amount) RCIT or Basic Tax (P1M x P300,000
30%)
Excess MCIT 2018 P50,000
MCIT (P14M x 2%) 280,000
2019 Tax Due/payable (Higher P300,000
RCIT or Basic tax P0 amount)
MCIT (P12M x 2%) 240,000 Less: Excess MCIT
Tax Due/payable (Higher P240,000 2018 (50,000)
amount) 2019 (240,000)
Excess MCIT 2019 P240,000 Income Tax Payable 2020 P10,000
 QUARTERLY AND ANNUAL CORPORATE TAX DUE

✔ If the computed quarterly MCIT is higher than the quarterly normal

income tax, the tax due to be paid is 2% of the gross income
✔ In payment of said ‘quarterly’ MCIT:

1. Excess MCIT from the previous taxable year(s)

shall not be allowed to be credited if the MCIT
is higher tha RCIT.
2. The expanded witholding tax, quarterly
corporate income tax and income paid in the
previous taxable quarter(s) are allowed to be
applied regardless if the MCIT is higher or not.
 COMPUTATION:
A corporation’s computed Regular Corporate Income Tax
(RCIT), MCIT and Income Taxes withheld from 1st to 4th quarters
including excess , MCIT and Excess withholding taxes from
prior year(s) are as follows:
Quarter RCIT MCIT Taxes Excess MCIT Excess
Withheld Prior Year Withholding
during the Tax (Prior
year Year)
1st P200,000 160,000 40,000 60,000 20,000
2nd 240,000 500,000 60,000 - -
3rd 500,000 200,000 80,000 - -
4th 400,000 200,000 70,000 - -