Links:

https://home.kpmg/xx/en/home/insights/2021/07/philippines-thinking-beyond-borders.html#:~:text=If%20the%20individual%20stays%20in,trade%20or%20business%20(NRANETB).

https://taxacctgcenter.ph/income-tax-classification-of-expatriates-in-philippines/

https://amslaw.ph/practice-areas/taxation/republic-act-no.-8424(2)

https://www.mondaq.com/corporate-tax/14148/taxation-of-individuals-under-the-national-internal-revenue-code-of-the-phillippines

b. Non-resident aliens engaged in trade or business

According to Section 22 (G) of the Philippine Tax Code, a non-resident alien engaged in trade or business (NRAETB) is someone who visits and spends more than 180 days in the Philippines within a calendar year. So, non-resident aliens who engage in trade or commerce in the Philippines are liable to income tax in the same way as citizens and resident aliens are, on all taxable income received from all sources within the Philippines except for the following types of income that are subject to final tax (on the gross amount):

A. Dividends in cash or property from a domestic corporation, joint stock company, insurance or mutual fund company, or regional operating headquarters of a multinational corporation, or a share in the distributable set income of a partnership (except a general professional partnership), joint account, joint venture taxable as a corporation or association of which he is a member, or co-venture - 20%.

B. Interests - 20%.

Interest income from long-term deposits or investments in the form of savings, common or individual trust funds, deposit substitutes, investment management accounts, and other investments evidenced by certificates in the form prescribed by the Bangko Sentral ng Pilipinas is exempt, provided that if the holder of the certificate pre-terminates the deposit or investment before the fifth year, a final tax on the entire income will be imposed and deducted - 20%.

C. Royalties - 20%.

However, royalties on books and other literary works, as well as royalties on musical compositions, will be subject to a 10% final tax.

D. Prizes and Other Winnings 20%.

However, prizes worth less than P10,000 are subject to the schedular tax rates.

E. Capital gains on the sale of non-exchange-traded stock - Not over P100,000 - 5%, and, on amounts over P100,000 - 10%.

F. Capital Gains from the Sale of Real Property in the Philippines that is classed as a capital asset - 6% of the gross selling price or the current fair market value as established by the Philippine tax administration, whichever is higher.

Moreover, they are also entitled to a personal exemption equal to the exemptions allowed by the income tax law of the country of which he is a subject or citizen to citizens of the Philippines not residing in such country, but not to exceed the amount fixed in this section as exemption for citizens or residents of the Philippines: Provided, that said non-resident alien should file a true and accurate tax return in the Philippines. In addition, a non-resident alien engaged in commerce or business is also not eligible for substituted filing.

c. Non-resident aliens not engaged in trade or business