Filing corporate income tax returns in the Philippines is a requirement for all corporations. Whether you’re running a small enterprise or a large corporation, understanding how to fulfill your tax obligations can save you from costly penalties and unnecessary stress. To help you stay compliant, we’ll explain what corporate income tax returns are, how to compute your taxes, and how and where to file them.
1. What Are Corporate Income Tax Returns?
Corporate income tax returns are official documents submitted by businesses to the Bureau of Internal Revenue (BIR) that declare their gross income, allowable deductions, and resulting taxable income over a specific period. These returns show how much tax a corporation owes the government based on its earnings.
In the Philippines, corporations are required to file:
- Quarterly income tax returns, to report income and taxes due every three months.
- Annual income tax returns, to consolidate the entire year’s financial activities and finalize tax obligations.
Even if a corporation operates at a loss or has no income for the period, it must still file its returns.
2. Who Needs to File Corporate Income Tax Returns?
All businesses registered with the Securities and Exchange Commission (SEC) and operating in the Philippines must file corporate income tax returns. These include:
- Domestic corporations
- Resident foreign corporations (doing business in the Philippines)
- Non-resident foreign corporations with income sourced from the Philippines
Keep in mind that the forms and calculations of corporate income tax returns may differ depending on the type of corporation. If you’re unsure which forms and rates apply to your company, don’t hesitate to book a consultation with our accountants and legal experts.
3. When to File Corporate Income Tax Returns
Corporations must file both quarterly and annual tax returns:
- Quarterly Return (BIR Form 1702Q): Due within 60 days after the end of each quarter.
- Annual Return (BIR Form 1702-RT, 1702-EX, or 1702-MX): Due on or before the 15th day of the fourth month after the end of the fiscal year (typically April 15 for calendar-year corporations).
4. How to Compute Corporate Income Tax
There are two main types of corporate income taxes:
- Regular Corporate Income Tax (RCIT)
- Rate: 25% of taxable income (20% for MSMEs that meet income and asset criteria, or for corporations eligible for certain tax incentives)
- Taxable income is calculated as:
Gross Income – Allowable Deductions (e.g., salaries, rent, utilities, depreciation)
- Minimum Corporate Income Tax (MCIT)
- Rate: 2% of gross income
- Imposed when RCIT is less than MCIT (typically applicable after the 4th year of operation)
Sample Computation:
- Gross Income: PHP 10,000,000
- Allowable Deductions: PHP 6,000,000
- Taxable Income: PHP 4,000,000
- RCIT: 25% of PHP 4,000,000 = PHP 1,000,000
- MCIT: 2% of PHP 10,000,000 = PHP 200,000
- Tax Payable: PHP 1,000,000 (whichever is higher between RCIT and MCIT)
5. Where to Get Income Tax Return Forms
You can access and download official tax return forms through the BIR website. Common forms include:
- BIR Form 1702Q – Quarterly Income Tax Return
- BIR Form 1702-RT – Annual Return for Regular Taxpayers
- BIR Form 1702-EX – For tax-exempt corporations
- BIR Form 1702-MX – For corporations with mixed income or special tax rates
6. How to File Corporate Income Tax Returns
Corporate income tax returns in the Philippines must be filed electronically through BIR-approved systems. Manual filing at RDO or bank is generally not allowed except in rare cases (e.g. system downtime, forms unavailable, or BIR-authorized reasons).
You can file online via:
eFPS (Electronic Filing and Payment System)
- Mandatory for large corporations, top private corporations, PEZA-registered enterprises, and others designated by the BIR.
- File and pay your ITR directly via the BIR portal using your registered AAB-linked online banking account
eBIRForms (Electronic BIR Forms)
- For corporations not covered by eFPS, you can use the offline eBIRForms package.
- Download the form (e.g. Form 1702-RT or 1702-EX), fill it out, validate it, generate a final copy, then submit it electronically
While online filing is convenient, it can make it harder to get timely assistance or verification. This increases the risk of errors or incomplete submissions. Fortunately, our team is available to ensure your corporate income tax returns are filed accurately and on time.
7. How to Pay
Corporations can pay taxes via:
- Authorized Agent Banks (AABs) under your RDO
- Online payments through GCash, Maya, Landbank, DBP, and other accredited platforms
- BIR ePay portal, available on the BIR website
8. Penalties for Late or Incorrect Filing
Filing late or submitting inaccurate information can result in:
- Surcharge on the tax due
- Interest per year on unpaid tax
- Compromise penalties based on the severity of the offense
Summary
Filing corporate income tax returns is not just a legal obligation but a sign of a responsible and compliant business. By knowing what forms to use, how to compute your dues, and where to file and pay, you protect your company from penalties and position it for future growth.
Computing and filing corporate income tax returns can be challenging without professional help. Contact us and we’ll take care of your accounting and compliance needs, so you can focus on growing your business.
Do You Need to Check if Your Business is Compliant? Find Help Here.
The Business Registration Philippines team offers legal and accounting services to help you with tax compliance. Outsourcing many of your bookkeeping, payroll, auditing, and other tasks to us is often more cost-effective than expanding your in-house accounting team. Reach out today to schedule an initial consultation with one of our experts.
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