Flashcards Studio

Marin Reyes, a resident Filipino digital marketing consultant, is employed by an international firm. During the year, he earned total compensation of ₱2,100,000 for services performed, with 60% of the services performed in the Philippines and 40% abroad (Japan). He also received dividends: ₱260,000 from a Philippine domestic corporation and ₱140,000 from a foreign corporation (Germany). He earned interest: ₱90,000 from a local bank and ₱60,000 from a foreign bank (Dubai). (a) Identify which portions of these receipts constitute Philippine-sourced income under the sources doctrine. (b) If Marin is a resident, explain how his total income is taxed in the Philippines, considering the resident (worldwide income) rule and any foreign tax credits. (c) If Marin were a non-resident, indicate which portions would be subject to Philippine tax and why.