Taxes are the lifeblood of our government and, by paying the right taxes, we contribute what is due to society. There are instances, however, that another tax could be imposed by the government of another country on the same income; thus, the establishment of a tax resident status by a taxpayer might be necessary.
Last week’s article discussed the accounting treatment for a short-term lease and a lease for low-value assets under the new Philippine Financial Reporting Standard (PFRS) 16 and taxation of operating lease as prescribed in Revenue Regulations (RR) No. 19-86 both for the lessee and the lessor. The discussion also tackled how the lessee and the lessor will record in their respective books various transactions related to leases, such as prepaid rentals and security deposits, and the proper reporting of these transactions for income tax purposes.
Philippine Financial Reporting Standard (PFRS) 16 is the new accounting standard for lease of assets or arrangements that contain a lease. It became effective on Jan. 1. It replaces Philippine Accounting Standard (PAS) 17, which means that entities reporting under PFRS shall apply this new standard in their lease transactions starting on the effectivity date.
In February, President Rodrigo R. Duterte signed Republic Act No. 11210 or the 105-Day Expanded Maternity Leave Law (EMLL). The expanded maternity leave benefits under the EMLL are fully tax-exempt. This is the interpretation issued by the BIR in RMC 105-2019. Indeed, this is a deserved tax break for working mothers.
A moral lesson can be gleaned from the circumstances surrounding the childhood of the greatest man who walked the earth, Jesus. This vital lesson also helps investors thrive in their business transactions, especially amidst fast-changing times.
My son, Khalil, will celebrate his 17th birthday next week. He now stands at five feet and 10 inches and is in senior high school. I had Khalil when I was very young. I was then a pregnant adolescent, still navigating through college, definitely lost and amiss. It was a very difficult period in my life. Without the guidance and support of my family and friends, I am not sure if I would have been able to get through such challenging times.
Change — it may mean alteration, modification, variation, conversion, transformation, or amendment. Whichever way we view it, change will always be part of our lives whether we like it or not. Our Philippine tax laws have been recently amended to lower the tax rates on income received by individual taxpayers to keep up with the changing times. As part of the move to keep up with our neighbors and be competitive, our Congress is now aiming to amend our tax laws to reduce the corporate income tax.
House Bill No. 4157 or the Corporate Income Tax and Incentives Rationalization Act (CITIRA) is on its way to the Senate after being approved on third reading in the House of Representatives.
