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Percentage Tax Description Percentage tax is a business tax imposed on persons, entities, or transactions specified under Sections 116 to 127 of the National Internal Revenue Code of 1997 (also known as Tax Code), as amended, and as required under special laws. 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.
2. Persons 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)
3. Persons engaged in the following industries/transactions:
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
ii. gas and water utilities.
d. Overseas dispatch, message or conversation transmitted from the Philippines by
telephone, telegraph, tele-writer exchange, wireless and other communication equipment services, except those transmitted by:
i. The Philippine Government or any of its political subdivisions or instrumentalities;
ii. Diplomatic services;
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.
e. Banks, non-bank financial intermediaries performing quasi-banking functions
f. Other non-bank financial intermediaries (including pawnshops as clarified under Revenue
Regulations [RR] No. 10 – 2004)
g. Person, company or corporation (except purely cooperative companies or associations)
doing life insurance business in the Philippines
h. Fire, marine or miscellaneous agents of foreign insurance companies
i. Proprietor, lessee or operator of cockpits, cabarets, night or day clubs, boxing exhibitions,
professional basketball games, Jai-Alai and racetracks, including videoke bars, karaoke bars, karaoke televisions, karaoke boxes and music lounges as clarified under Revenue Memorandum Circular (RMC) No. 18 – 2010
j. Winnings or 'dividends' in horse races
How to file/pay? Documentary Requirements
1. BIR Form 2551Q - Quarterly Percentage Tax Return Form
2. Duly issued Certificate of Creditable Tax Withheld at Source (BIR Form 2307), 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
6. Copy of Certificate of Registration issued by Cooperative Development Authority for cooperatives,
and from the National Electrification Administration for electric cooperatives Procedures
1. For Manual filing and/or payment:
a. Download the newly-revised BIR Form 2551Q pdf file format under the BIR
Forms-VAT/Percentage Tax Returns section of the BIR website.
b. Properly fill-up BIR Form 2551Q in triplicate copies.
c. Proceed to any Authorized Agent Bank (AAB)located within the territorial jurisdiction of
the Revenue District Office (RDO) where the taxpayer is registered and present the duly accomplished BIR Form 2551Q and other requirements. If paying manually, present the aforementioned documents together with BIR-prescribed deposit slip, and payment to the respective AAB. The Quarterly Percentage Tax shall be paid at the time the return is filed by the taxpayer.
d. In places where there are no AABs, the duly accomplished BIR Form 2551Q, together
with the required attachments and payment, shall be filed/paid with the Revenue Collection Officer (RCO), thru the Mobile Revenue Collection Officers System (MRCOS) facility, or duly Authorized Treasurer of the city or municipality where said business or principal place of business / where the taxpayer is registered, who will issue an Electronic Revenue Official Receipt (eROR).
e. Receive copy of BIR Form 2551Q duly validated/stamp-received by the
AAB/RCO/authorized City or Municipal Treasurer.
f. Manual Filers who want to pay online can pay through GCash Mobile Payment,
LandBank of the Philippines (LBP) Linkbiz Portal (for taxpayers who have ATM account with LBP/Bancnet ATM or Debit Card), or DBP Tax Online (for holders of VISA/Master Credit Card/Bancnet ATM or Debit Card).
2. For eFPS filing and/or payment:
a. Use the existing and enhanced old BIR Form 2551Q in the eFPS system which contains
all the alphanumeric tax codes (ATCs) enumerated in the said form in filing the return.
b. Taxable amount to be indicated in the quarterly percentage return shall be the total gross
sales/receipts for the quarter.
Franchise grantees: Gas and water utilities Radio and television broadcasting companies whose annual gross receipts of the preceding year do not exceed Php10,000,000 and did not opt to register as VAT taxpayer Gross receipts Gross receipts
Overseas dispatch, message or conversation originating from the Philippines Amount paid for the service 10% Banks and non-bank financial intermediaries performing quasi-banking functions Interest, commissions and discounts from 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 or less 5%
- If maturity period is more than five years
Dividends and equity shares and net income of subsidiaries
Royalties, rentals of property, real 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 year of foreign currency, debt securities, derivatives and other similar financial instruments
Other non-bank financial intermediaries Interest, commissions, discounts 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 or less 5%
- If maturity period is more than five years
Life Insurance Company/Agent/Corporation (except purely cooperative companies or associations) Total premiums collected 2% Agents of foreign insurance companies (except reinsurance premium): Insurance agents authorized under the Insurance Code to procure policies of insurance for companies not authorized to transact business in the Philippines Total premiums collected 4% Owners of property obtaining insurance directly with foreign insurance companies Total premiums paid 5% Proprietor, lessee or operator of the following: Cockpits Gross receipts 18% Cabarets, Night or Day Clubs, videoke bars, karaoke bars, karaoke televisions, karaoke boxes and music lounges Gross receipts 18%
Boxing exhibitions (except when the World 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) Gross receipts 10% Professional basketball games (in lieu of all other percentage taxes of whatever nature and description) Gross receipts 15% Jai-alai and race track Gross receipts 30% Winnings on horse races Winnings or 'dividends' 10% Winnings from double forecast/quinella and trifecta bets
Prizes of owners of winning race horses
[return to index] 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
1. BIR Form 2552 - Percentage Tax Return for Transactions Involving Shares of Stocks
2. Duly issued Certificate of Creditable Tax Withheld at Source (BIR Form 2307), if applicable
3. Proof of Exemption for transactions not subject to tax, if applicable
4. Duly approved Tax Debit Memo, if applicable
5. For amended return, proof of payment and the return previously filed
6. Authorization letter, if filed by an authorized representative
Procedures
1. For Manual filing and/or payment:
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 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 shares of stock listed and traded through the Local Stock Exchange other than the sale by a dealer of securities Gross selling price or gross value in money 6/10 of 1% Sale, barter or exchange or other disposition through: Initial Public Offering (IPO) – the issuing corporation shall pay the imposed tax Secondary Public Offering – the seller shall pay the imposed tax Gross selling price or gross value in money Proportion of disposed shares to total outstanding shares after the listing in the local stock exchange: Up to 25% 4% Over 25% but not over 33 1/3%
Over 33 1/3% 1%
