Revenue Regulations No.

5 – 2021

Implementing the New Income Tax Rates on

the Regular Income of Corporations, on
Certain Passive Incomes, Including
Additional Allowable Deductions from
Gross Income of Persons Engaged in
Business or Practice of Profession Pursuant
to Republic Act (RA) No.11534 or the
“Corporate Recovery and Tax Incentives for
Enterprises Act” (CREATE), Which Further
Amended the National Internal Revenue
Code (NIRC) of 1997
 Sec. 2. R.A. No. 11232

The Corporation Code defines a corporation as

an artificial being created by operation of law,
having the right of succession and the powers
attributes, and properties expressly authorized by
law or incident to its existence.
 SCOPE INCOME
TAXATION
1. One- person corporation
2. Business Partnership, no matter how created or
organized
3. Joint-stock companies
4. Joint accounts (cuentas en participacion)
5. Associations, or insurance companies
Not Included:
• General Professional Partnerships and
• Joint venture or consortium ( Sec. 22(B), NIRC )
 Classification of Corporation

Corporations maybe classified into domestic or foreign.

• Domestic when applied to a corporation, means created and

organized in the Philippines or under its laws.

• Foreign means a corporation which is not domestic. Thus,

foreign corporations are those organized, authorized or existing
under any laws other than the Philippine law.
a. Resident Foreign
b. Non- resident Foreign
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