2015 Inclusions From Gross Income

Income Taxation

INCLUSIONS FROM GROSS INCOME

1

Computation of taxable income

Corporation

Gross income P xxx Less: Deductions xxx Taxable income P xxx

2

Computation of taxable income

Individual Gross income P xxx Less: Deductions xxx Income before personal

exemption P xxx Less: Personal exemption xxx Taxable Income P xxx

3

Meaning of income

Broad sense - Income means all wealth, which

flows into the taxpayer’s hands other than as a mere return of capital.

4

Meaning of income

Judicial definition – Income is the gain derived from

labor or from capital, or from both labor and capital, including the gain derived from the sale or exchange of capital asset.

5

Income distinguished from other terms

From capital – Capital is the fund or property existing at one distinct time, while income denotes a flow of wealth during a definite period.

6


From receipts – Receipts have a reference to all

wealth that flows into the taxpayer, which includes returns of capital.

Receipts are broader in scope than income.

7


From revenue – Revenue, as applied in taxation, refers

to all funds or income derived by the government, whether from tax or any other source while income, for tax purposes, is employed in its “natural and obvious sense” to mean money or gain received, coming to a person (natural or juridical) during a given period of time. 8


From revenue –

Revenue is to the government while income is to a person (natural or juridical).

9

Taxable Income Requisites of a taxable income. 1. There must be gain 2. The gain must be realized or

received 3. The gain must not be excluded by

law from taxation

10

Gross income defined

Except when otherwise provided, gross income means all income from whatever source, including (but not limited to the following items):

11

Classification of Income

1. Compensation Income 2. Profession or Business

Income 3. Passive Income 4. Capital Gain

12


Compensation Income and Profession or business income normally subject to normal tax,

while the passive income and capital gain are normally subject to final tax.

13


Final tax – taxes that withheld by the government to further classify if they’re tax base has a tax consequences. If they’re tax base are nontaxable, the entity can refund the withheld cash.

14

Inclusions – Taxable Gross Income

} Compensation Income } Gross income from business } Gains from dealings in property } Interest } Rents } Royalties } Dividends } Annuities } Prizes and Winnings } Pensions } Partner’s distributive share from the net

income of general professional partnership 15

Items of gross income defined

A. Compensation for personal services

16

Gross compensation income defined

- means all remuneration for services performed by an employee for his employer, whether paid in cash or in kind, unless specifically excluded under the Tax Code (e.g. salaries, wages, emoluments, honoraria, bonuses, allowances, director’s fee

17

Director’s fee is part of gross compensation income if

the director is at the same time an employee of the employer/corporation.

If the director is not an employee, the director’s fee is subject to 10% creditable withholding tax if the current year’s gross income is P720,000 and below (15% if current year’s gross income exceeds P720,000)

18

Compensation in the absence of employer-employee relationship

In the absence of employee-e m p l o y e r r e l a t i o n s h i p , compensation for personal services shall be considered as gross professional fee. (e.g. audit fees received by CPA from his client, lawyer’s fee)

19

Casual Labor

•  If the casual Labor is not business related, not considered as compensation and should be excluded in determining the tax. Otherwise, if the casual labor is business related it should be included in the compensation and has tax consequences.

20

Examples of compensation for services rendered

1. Salaries, wages and fees 2. Commissions paid to salesmen 3. Compensation for services on the

basis of a percentage of profits 4. Commissions of insurance

premiums 5. Tips

21

Examples of compensation for services rendered

6. Pensions of retiring allowances paid by private persons or by government (except pensions exempt from tax)

7. Marriage fees, baptismal offerings, sums paid for saying masses for the dead and other contributions received by a clergyman, evangelist or religious worker for services rendered

22

Retirement Pay

• Retirement pay is taxable except if it is administered by the SSS/GSIS or prescribed and approved by the BIR.

23

Separation Pay

•  If the separation pay is voluntarily is has a tax consequences, if it is involuntary, nontaxable

24

13th Month Pay

– nontaxable to the extent allowed by law

- Excess is taxable subject to normal tax

25

Gross Income from Business Sales Less : Sales Discount Sales Return and Allowances

Net Sales Less : Cost of Sales Gross Income from Sales Add : Other Income Gross Income from Business

26

Gains from Dealings in Property Types of Property

– Ordinary Assets – Capital Assets

Ordinary Assets – 1. Stock in trade which would be

properly included in an inventory of the taxpayer at the end of the year.

– 2. Property held by the taxpayer primarily for sale

– 3. property used in trade or business subject to depreciation.

– 4. real property used on trade or business. 27

Gains computation Selling price Less : Cost Gain or Loss

– Capital gain or capital loss • Capital gain less capital loss = net capital gain/loss

– Ordinary gain or ordinary loss • Ordinary gain less ordinary loss = Net ordinary gain/loss

28

Interest income Included in interest income -  such interest arising from

indebtedness, whether business or non-business.

-  Unless exempted by law, interest received by a taxpayer, whether or not usurious, are taxable.

29

Interest income Subject to final tax - 1.  Interest income from Philippines

sources subject to final tax (not included in the taxable net income subject to tax rates in general)

2.  Interest from any currency bank deposit

3. Yield or any other monetary benefit from deposit substitute

30

Interest income Subject to final tax - 4. Yield or any other monetary benefit

from trust funds and similar arrangements

5. Interest income received from a depository bank under expanded foreign currency deposit system

6. Interest income from long-term deposit or investment evidence by certificates prescribe by BSP if pre-terminated before the fifth year.

31

Interest income

Exempt from tax – Interest income from Philippine

sources exempt from tax: •  Interest income received by a

depository bank under the expanded foreign currency deposit system by non-residents (individuals or corporations)

32

Interest income

Exempt from tax – Interest income from Philippine

sources exempt from tax: •  Interest income from long-term

deposit or investments evidenced by certificates prescribed by Bangko Sentral ng Pilipinas.

33

Interest Sources of Interest Income } 1. Bank deposits } 2. Loans Note : 1. only interest income from loans

will be included in the computation of gross income

2. Interest income from bank deposits is subject to final tax

34

Interest income exempt from tax

•  If received : – 1. by members from a duly-registered

cooperative. – 2. by investor from BSP prescribed form

of investment maturing more than 5 years.

– 3. by non-resident citizen/alien from expanded foreign currency deposit system.

– 4. by the landlord from a tenant who paid the price of land under the tenant-purchaser agreement under CARP.

35

Rent/Lease Income •  Advance Rent

– Included in the computation of the taxable gross income

•  Rent Deposits – Not included as gross income because it is not an income on the part of the taxpayer but merely a form of security or assurance to be returned to the lessee 36

Rent/Lease Income • Cost of Improvements

– To be added as rent income if shouldered by the lessee

– If shouldered by the lessor, the amount is an expense on the part of the lessor

37

Royalty Income •  On books, literary works and

musical composition – From sources within the Philippines subject to 10% final tax

– From sources outside the Philippines to be added as part of the taxable gross income

38

Royalty Income •  On other sources

– From sources within the Philippines subject to 20% final tax

– From sources outside the Philippines to be added as part of the taxable gross income

39

Royalty Income • Subject to final tax

– Royalties from Philippines sources

• Subject to tax rates in general – Royalties from foreign sources

40

Dividend income Difference between direct and indirect

dividends •  A direct dividend is one where the

paying corporation acknowledges that the distribution is a dividend payment

•  An indirect dividend is a distribution of profits disguised as payment of services, properties, etc.

41

Dividend income Tax exempt if:

– 1. Received from a domestic corporation by: • A. Another domestic corporation. • B. Resident foreign corporation.

– 2. received from a cooperative. – 3. pure stock dividend. – 4. Pure Liquidating dividends (return

of capital)

42

Dividend income •  Subject to final tax if received

from a Domestic Corporation by a: – 1. a citizen or resident alien = 10% final tax

– 2. non-resident alien doing business in the Philippines = 20% final tax

43

Dividend income •  Subject to final tax if received from a

Domestic Corporation by a: – 3. non-resident alien not doing

business in the Philippines – 25% final tax

– 4.non-resident foreign corporation – 20% final tax with reciprocity and 30% if without reciprocity

44

Dividend income

•  Subject to normal tax if: – 1. Not included as tax-exempt dividends.

– 2. Not subject to final tax. – 3. Distributive shares of partner in professional partnership.

45

Prizes and Winnings Subject to tax rates in general 1. Prizes and winnings from foreign

sources received by individuals and corporations

2. Prizes and winnings from Philippine sources received by corporations

3. Prizes from Philippine sources received by individuals amounting to P10,000 or less.

46

Prizes and Winnings Subject to final tax •  Prizes received by individuals from

Philippine sources [except prizes amounting to P10,000 or less which shall be subject to tax under Sec. 24 (A)]

•  Other winnings of individuals from Philippine sources (except Philippine Charity Sweepstakes and Lotto winnings)

47

Prizes and Winnings •  Prizes are subject to final tax of 20%

if exceeding P10,000. If not exceeding P10,000, it is subject to normal tax.

•  Winnings are subject to final tax of 20% regardless of amount. But if received outside the Philippines, it is subject to normal tax.

•  Winnings from Philippine Lotto and PCSO are tax exempt.

48

Prizes and Winnings

49

Exempt/Excluded from gross income •  Philippine charity sweepstakes and

Lotto winnings •  All prizes and awards granted to

athletes to local and international sports competitions and tournaments whether held in the Philippines or abroad and sanctioned by their national sports association.

Prizes and Winnings

50

Exempt/Excluded from gross income

•  Prizes and awards made primarily in recognition of achievements in the following fields:

- Religious, Charitable, Scientific, Educational, Artistic, Literary,

Civic

Prizes and Winnings

51

Conditions for exemptions of prizes and awards:

1. The recipient was selected without any action on his part to enter the contest or proceedings; and

2. The recipient is not required to render substantial future services as a condition to receiving the prize or award

Bad Debts Recovery Rules:

– 1. There must be a valid and existing debt.

– 2. The debt must be actually ascertained to be worthless and uncollectible during the taxable year.

52

Bad Debts Recovery Rules:

– 3. The debt must be charged off during the taxable year.

– 4. The debt must arise from the business or trade of the taxpayer.

Note: the amount recovered is only

taxable to the extent of tax benefit in the year the account was written off. 53

Bad debt recovery is generally taxable

•  Tax benefit rule: If in the year the bad debt was written off, there was a reduction of taxable income, bad debt recovery shall constitute taxable income

54

Tax refunds

•  If the refunded tax is a deductible tax, the tax refund is taxable

•  If the refunded tax is not a

deductible tax, the tax refund is not taxable

55

Tax Refund or credit •  The ff tax refund are NOT taxable:

– 1. Philippine income tax, except the fringe benefits tax

– 2. Estate or donor’s tax – 3. Special assessment – 4. income tax of a foreign country claimed as a tax credit

– 5. stock transaction tax. – 6. Value-added tax

56

Annuities An annuity is a specified

income payable at a stated intervals for a fixed or a contingent period, often for the recipient’s life, in consideration of a stipulated premium paid either in prior installment payment’s or in a single payment.

57

Annuities

•  If the annuity is a return of premium paid by the taxpayer, the annuity is not taxable.

•  If the annuity represents interest, it is taxable.

58

Damage Recovery •  Types:

– 1. Compensatory Damages – representing returns of capital are NOT taxable including amount received as moral damages for personal action.

– 2. Recovered damages – representing recoveries of lost profits are taxable.

59

Damage Recovery • Recovery of lost profit is taxable

• Recovery of lost capital is not taxable

60

Cancellation of Debts

•  If payment of income – taxable income

•  If a form of gift – not subject to income tax but subject to donor’s tax.

61


If debtor rendered service in favor of the creditor, forgiveness of debt results in a taxable income to the debtor

62


If the debtor did not render service in favor of the creditor, forgiveness of debt results in a taxable indirect gift

63


I f t h e d e b t o r i s a s t o c k h o l d e r o f a corporation, forgiveness of d e b t b y t h e c r e d i t o r corporation results in dividend distribution

64

Income from whatever sources

•  Income from illegal sources including – - gambling – - kidnapping – - extortion – - smuggling – -embezzlement – Illegal business 65

REASON: - these funds are taxable because title is merely voidable

66

Even though the law imposes a legal obligation upon an embezzler or thief to repay the funds, the embezzled or stolen money is gross income.

REASON the embezzler or thief has no intention of repaying the money. This is known as the James Doctrine. This has overruled the Wilcox doctrine.

67

Proceeds of stolen or

embezzled property taxable income.

REASON the money or other

proceeds of the sale or disposition of stolen property is subject to income tax because the proceeds are received under a claim of right

68

Under the Wilcox doctrine,

which is not followed in the Philippines, the proceeds of swindling or embezzlement, theft or robbery, not income subject to tax.

69

Examples of income from whatever source

Gains arising from expropriation of property

70

Money received under solutio indebiti

•  Income paid or received t h r o u g h m i s t a ke m a y b e considered as “income from whatever source der ived” irrespective of the voluntary or invo luntar y act ion o f the taxpayer in producing the income.

71

Money received under solutio indebiti

-  under the cla im of r ight doctrine, the recipient, even if he has the obligation to return the same, has a voidable title to the money received through mistake

-  taxable 72

Income Taxation

EXCLUSIONS FROM GROSS INCOME

73

Definition •  Income received or earned

but is not taxable because it is exempted by law or treaty.

74

Rationale for the exclusion •  Some receipts are excluded

from gross income because they are not income.

•  Even if they are by definition income, the exclusions are not subject to tax because of policy considerations such as to avoid the effects of double taxation, or to provide incentives for certain socially desirable activities.

75

Taxpayers who may avail of the exclusions

•  All kinds of taxpayers, individual, estates and trusts and corporate, whether citizens, aliens, whether residents or non-residents may avail of exclusions.

76

Classification of Exclusion

Temporary Exclusion •  Exclusions from gross income

which result from a timing of recognition of income.

•  These are income which are deferred recognition for income tax purposes.

77

Classification of Exclusion

Substantive exclusion -  Receipts which are not

considered as income. -  They shall not be included in

the income tax return and therefore are exempt from income taxation.

78

Exclusions from Gross income VS Deductions from Gross Income Exclusion •  Refers to the a flow of wealth

to the taxpayer which are not treated as part of gross income for purposes of computing the taxpayer’s taxable income because it is exempted by the fundamental law by statutes and it does not come within the definition of income. 79

Exclusions from Gross income VS Deductions from Gross Income

80

Deduction •  These are amounts

which the law allows to be subtracted from gross income in order to arrive at net income.

Exclusions to Gross Income under the National Internal Revenue Code of 1997

(LAGCIRM) •  L- Life Insurance proceeds •  A- Amount received by insured

as return of premium •  G- Gifts, bequest and devises •  C- Compensation for injuries

or sickness

81

(LAGCIRM) •  I- Income exempt under treaty •  R- Retirement benefits, pensions,

gratuities •  M- Miscellaneous Items

– Income derived by foreign government

– Income derived by the government or its political subdivisions

– Prizes and awards 82

(LAGCIRM) •  M- Miscellaneous Items

– Prizes and awards in sports competitions

– 13th month pay and other benefits – GSIS, SSS, Medicare and other

contributions – Gains from the sale of bonds,

debentures or other certificate of indebtedness

– Gains from redemption of shares in mutual fund.

83

LIFE INSURANCE PROCEEDS

•  insurance on human life and insurance appertaining thereto or connected therewith.

•  An insurance upon life may be payable on the death of the person, or on his surviving a specified period, or otherwise contingently on the continuance or cessation of life.

84

Conditions for exclusion from gross income of life insurance proceeds

•  The proceeds of life insurance policies

•  paid to the heirs or beneficiaries

•  upon the death of the insured, •  whether in a single sum or

otherwise

85

Reasons for exclusion

•  Proceeds of life insurance are excluded from gross income because they partake more of indemnity or compensation rather than gain to the recipient

•  Life insurance proceeds serve the same purpose as nontaxable inheritance.

86

Interest paid on life insurance proceeds when included as part of the gross income and not an inclusion.

•  Such amounts of life insurance proceeds are held by the insurer under the agreement to pay interest thereon, the interest payments shall be included in the in gross income. Interests do not form part of the indemnity but earnings or income from the use of capital which are taxable.

87

Instances where the life insurance proceeds are not excluded from

gross income

1. Where the life insurance policy is used to secure a money obligation

2. Where the life insurance policy was transferred for a valuable consideration

88


gross income

3. The recipient of the insurance proceeds is a business partner of the deceased and the insurance was taken to compensate the partner –beneficiary for any loss income that may result as the death of the insured partner

89


gross income

4. The recipient of the insurance proceeds is a partnership in which the insured is a partner and the insurance was taken to compensate the partnership for any loss in income that may result from the dissolution of the partnership caused by the death of the insured partner

90


gross income

5. The recipient of the life insurance proceeds is a corporation in which the insured was an employee or officer.

91

AMOUNT RECEIVED BY INSURED AS RETURN OF PREMIUM

Conditions for amounts received by insured as return of premiums to be excluded from gross income

1.  The amount received by the insured 2.  as a return of premiums paid by him 3.  under life insurance, endowment or annuity

contracts 4.  Either during the term, at the maturity

of the term mentioned in the contract, upon surrender of the contract

92

AMOUNT RECEIVED BY INSURED AS RETURN OF PREMIUM

Reason for the exclusion •  The amounts returned are

not income but return of capital.

• They represent earnings which were previously taxed

93

Endowment

•  The insurer agrees to pay a sum certain to the insured if he outlives a designated period.

•  If he dies before that date, the proceeds are to be paid to the designated beneficiary.

94

Tax treatment of proceeds received under endowment

policies

– if the insured dies, and the beneficiary receives the life insurance proceeds, these are not taxable income because they are excluded from gross income

95

Tax treatment of proceeds received under endowment

policies

– if the insured does not die and survives the designated period, the amount pertaining to the premiums he paid are excluded from gross income, but the excess shall be considered part of his gross income.

96

GIFTS, BEQUESTS, AND DEVISES

•  Property received as a gift or received under a will or testament, or through legal succession, is exempt from income tax although the income therefrom or income derived from its investment, sale or otherwise is not.

97


•  An amount of principal paid under a marriage settlement is a gift. Neither alimony nor an allowance based on separation agreement is taxable income.

98


Reason for exclusion •  The property is subject to donor’s

or estate’s taxes as the case may be. Furthermore, there is no income.

99

Income from property acquired by gift, bequest, devise or descent included in gross income

1. Income from such property acquired by gift, bequest, devise or descent

2. As well as gift, bequest, devise or descent of income from any property, in case of transfers of divided interest shall be included in gross income

100

Compensation VS Gift •  If the payment is intended to

represent payment, whether designated as compensation or otherwise, for services rendered either in the past, present or future, the amount received will be taxable income to the recipient.

101

Compensation VS Gift If the payment are made to show

goodwill or a mere kindness towards the recipients and are not intended as a recompense for services rendered, then the payments represent gifts and should be exempt.

102

COMPENSATION FOR INJURIES OR SICKNESS

•  Amounts received, through accident or health insurance or Workmen’s Compensation Acts as compensation for personal injuries or sickness plus the amounts of any damages received, whether by suit or by agreement on account of such injuries or sickness

103


Reason for exclusion of damages •  They are mere compensation for

injuries or sickness suffered and not income. The legal theory of personal injury damages is that the amount received is intended to make the plaintiff whole as before the injury.

104


Reason for exclusion of damages •  There is need to exclude the

compensation so as to restore the injured party whole as before the injury.

•  To include the compensation for injuries or sickness suffered in gross income would be reducing the restoration of the plaintiff whole as before the injury.

105

Two kinds of compensation that maybe excluded from gross income

1. amounts received, through

Accident or Health Insurance or Workmen’s Compensation Acts – as compensation for personal injuries or sickness

106

Two kinds of compensation that maybe excluded from gross income

2. amounts of any damages

received whether – by suit or agreement – on account of or resulting from such injuries or sickness

107

Compensation paid out of Accident or

Health Insurance are absolutely excluded from gross income

•  Although the payments are intended

to compensate the insured taxpayer for loss of future income, the exclusion is expressly provided by law and should not be subject to any interpretation.

108

Compensation paid out of Accident or

Health Insurance are absolutely excluded from gross income

•  The law does not make any distinction whether the Accident or Health Insurance was secured by the taxpayer or his employer. Thus, whatever amounts are received are excluded from gross income.

109

Compensation paid out of Workmen’s

Compensation Acts are absolutely excluded from gross income

•  There are instances where the

employer is required by labor laws to compensate the employer for work-related personal injuries.

110

Although the payments are

intended in part to compensate for loss of future income, the exclusion is expressly provided by law and should not be subject to any interpretation.

Thus, whatever amounts that are

received are excluded from gross income.

111

Kinds of damages arising from personal injuries and sickness, that maybe excluded from gross compensation

1. Actual or compensatory 2. Moral 3. Nominal 4. Temperate or moderate

112

Damages arising from libel or slander, breach of contracts and others that do not result from personal injuries or sickness are not excluded from gross income and taxable

•  Such kinds of damages are

separate from damages received on account of sickness and personal injuries.

113

Actual or compensatory damages

•  This is the adequate

compensation for pecuniary loss suffered as may be duly proved during the proceedings.

114

The actual or compensatory d a m a g e s t h a t m a y b e recovered should be that awarded by the court or by a g r eement between the parties as a consequence of the sickness or physical in jur ies suf fered by the taxpayer.

115

Income exempt under treaty excluded from gross income

•  Income of any kind to the

extent required by any treaty obligation binding upon the Government of the Philippines. Although this is income, it is excluded from gross income by reasons of public policy.

116

Income exempt under treaty excluded from gross income

Reason for the exclusion •  Public policy recognizes the

principle of reciprocity and comity among nations as the reasons behind the exclusion.

117

Reciprocity •  A principle in international law

that refers to the practice among sovereign nations of giving concessions on the basis of similar concessions accorded them by other nations. It is premised upon a prior grant of a privilege, in short a quid pro quo.

118

COMITY the respect accorded by sovereign

nations because they are equal. Since, the power of taxation is an exercise of sovereignty, and then it is not exercised upon other equal sovereign nations, as well as courtesies of the port exempting their importation of personal and household effects.

119

Retirement benefits, gratuities, pensions that excluded from

gross income 1. Retirement benefits received

under the Republic Act No. 7641 2. Retirement received from

reasonable private benefit plan after compliance with certain conditions

3. Amounts received for beyond control separation

120

Retirement benefits, gratuities, pensions that excluded from

gross income 4. Foreign social security,

retirement gratuities, pensions

5. USVA benefits 6. SSS benefits 7. GSIS benefits

121

Conditions for excluding retirement benefits from gross income

A. Retirement benefits 1. Received under Republic Act No.

7641 and those 2. Received by officials and

employees of private firms, whether, individual or corporate, in accordance with a reasonable private benefit plan maintained by the employer. Provided that,

122

Conditions for excluding retirement benefits from gross income

B. Retiring official or employee has been

1.  In the service of the same employer for at least ten years

2. Not less than 50 years of age at time of retirement

3. The benefits granted under this subparagraph shall be availed of by an official or employee only once

123

Kinds of Retirement 1. Optional Retirement under

Republic Act No. 7641 a.  In the absence of a retirement plan

or agreement providing for retirement benefits of employees in the establishment,

b.  an employee upon reaching the age of 60 years or more,

124

Kinds of Retirement 1. Optional Retirement under

Republic Act No. 7641 C. who has served at least 5 years in

the said establishment, D. may retire and shall be entitled to

retirement pay equivalent to at least one-half month salary for every year of service, a fraction of at least 6 months being considered as one whole year

125

Kinds of Retirement 2. Mandatory Retirement under

Republic Act No. 7641 a.  In the absence of a retirement plan

or agreement providing for retirement benefits of employees in the establishment,

b.  an employee upon reaching the age of beyond 65 years which is hereby declared the compulsory retirement age,

126

Kinds of Retirement 2. Mandatory Retirement under

Republic Act No. 7641 C. who has served at least 5 years in

the said establishment, D. may retire and shall be entitled to

retirement pay equivalent to at least one-half month salary for every year of service, a fraction of at least 6 months being considered as one whole year.

127

Separation pay excluded from gross income

1. any amount received by an official, employee or by his heirs

2.  from the employer 3. as a consequence of separation of

such official or employee from the service of the employer –  because of death, sickness or other

physical disability –  for any cause beyond the control of the

said official or employee such as

128

»  Retrenchment- it means reduction of personnel

»  Redundancy- a position is redundant where it is superfluous, as superfluity of a position or positions may be the outcome or a number of factors, such as over hiring of workers

»  Cessation or closure of the business- an employer has the right to close entirely totally or partially his business and this would occasion the beyond control separation of his employees

129

OTHER EXCLUSIONS

•  Benefits received from foreign government agencies and other institutions, public or private

•  Pensions, gratuities from foreign government agencies and other institutions, public or private

130

OTHER EXCLUSIONS

- Benefits under the laws of the United States given to veterans

-  benefits derived from or enjoyed under the Social Security System in accordance with the provision of Republic Act No. 8282

-  Benefits received from the GSIS under Republic Act No. 8291

131

OTHER EXCLUSIONS •  Income derived from investments in

the Philippines in loans, stocks, bonds or other domestic securities, or from interest on their deposits in the Philippines by – Foreign government – Financing institutions owned, controlled

or enjoying refinancing from foreign government

– International or regional financing institutions established by foreign government

132

OTHER EXCLUSIONS - Income derived by the

Government or its political subdivision – From any public utility – From the exercise of any essential governmental function accruing to the government of the Philippines or to any political subdivision thereof.

133

Documents

2015 Inclusions From Gross Income