Company Overview

Philippine Seven Corporation

Vision
Our vision is to be the best retailer of convenience for emerging markets.

Mission
To make daily life easier by providing modern convenience.1

Nature of Business

Philippine Seven Corporation operates convenience stores in the Philippines. It engages in

retailing, merchandising, buying, selling, marketing, importing, exporting, franchising,
acquiring, holding, distributing, warehousing, trading, exchanging, collecting, accepting, and
dealing in various grocery items, dry goods, food or foodstuff, beverages, drinks, and other
consumer products. The company also offers bills payment services; phone/call cards; and 7-
Connect, a service that enables customers to pay for utility bills and selected online purchases
with cash through 7-Eleven stores. In addition, it manages, develops, sells, exchanges, and
holds various real estate properties, including buildings, houses and apartments, and other
structures. Further, the company operates and maintains warehouses, storages, delivery
vehicle, and other related facilities. As of December 31, 2017, it operated a network of 2,285
stores under the 7-Eleven brand name. The company was founded in 1927 and is
headquartered in Mandaluyong, the Philippines. Philippine Seven Corporation is a subsidiary
of President Chain Store (Labuan) Holdings, Ltd.2

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Value-Added Tax

As defined by the BIR, Value-Added Tax (VAT) is a form of sales tax. It is a tax on
consumption levied on the sale, barter, exchange or lease of goods or properties and services
in the Philippines and on importation of goods into the Philippines. It is an indirect tax, which
may be shifted or passed on to the buyer, transferee or lessee of goods, properties or services.

BIR Form 2550M or 2550Q, also known as Monthly or Quarterly Value-Added Tax
Return is a form used for filing value-added tax imposed on sales or exchange of goods and
services in the Philippines.

First off, before you can be able to fill out the form, you will need to fill out first the eBIR
Form main screen shown in the figure 1 where you have to indicate the donor's TIN, RDO
code, line of business, taxpayer's name (last name, first name, middle name for individual) or
the registered name (for non-Individual), registered address, zip code, telephone number and
email address. Below is the list of BIR Forms where you can choose what type of form you
will need for the filing of the return. Select the BIR Form No.2550M for monthly value-
added tax return or BIR Form No.2550Q for quarterly value-added tax return. After selecting
the applicable form, you can now start filling out the required information in the form.

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Flow Chart
Filing of Value-Added Tax Return

Procedures:

Fill-up BIR Form No. 2550M in

1 triplicate copies (two copies for the
BIR and one copy for the taxpayer).

2 If there is payment:

File the Monthly VAT declaration, together with

the required attachments, and pay the VAT due
thereon with any Authorized Agent Bank (AAB). In places where there are
Monthly VAT declaration
required attachments and
Accomplish and submit BIR-prescribed deposit with the Revenue Collec
slip, which the bank teller shall machine validate
as evidence that payment was received by the
AAB. The AAB receiving the tax return shall The RCO shall issue a R
stamp mark the word "Received" on the return and Receipt upon payment of
machine validate the return as proof of filing the
return and payment of the tax.

If there is no payment:
File the Monthly VAT Declaration,
together with the required attachments,
with the RDO/LTDO/Large Taxpayers
Assistance Division, Collection Agent
having jurisdiction over the registered
address of the taxpayer (head office of the
business establishment).

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Percentage Tax

Percentage tax is a business tax imposed on persons or entities who sell or lease goods,
properties or services in the course of trade or business whose gross annual sales and/or
receipts do not exceed P 3, 000, 000 and who are not Value Added Tax (VAT)-registered.

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Flow chart for filing percentage tax

For Manual filing and/or payment:

Download the newly-revised BIR Form

2551Q pdf file format under the BIR
Forms-VAT/Percentage Tax
Returns section of the BIR website.

Properly fill-up BIR Form 2551Q in

triplicate copies.

Receive copy of BIR Form 2551Q duly

Proceed to any Authorized Agent validated/stamp-received by the
Bank (AAB) located within the territorial AAB/RCO/authorized City or Municipal
jurisdiction of the Revenue District Treasurer.
Office (RDO) where the taxpayer is
registered and present the duly
Manual Filers who want to pay online
accomplished BIR Form 2551Q and
can pay through GCash Mobile Payment,
other requirements. If paying manually,
LandBank of the Philippines (LBP)
present the aforementioned documents
Linkbiz Portal (for taxpayers who have
together with BIR-prescribed deposit
ATM account with LBP/Bancnet ATM or
slip, and payment to the respective AAB.
Debit Card), or DBP Tax Online (for
The Quarterly Percentage Tax shall be
holders of VISA/Master Credit
paid at the time the return is filed by the
Card/Bancnet ATM or Debit Card).
taxpayer.

In places where there are no AABs, the

duly accomplished BIR Form 2551Q,
together with the required attachments
and payment, shall be filed/paid with the
Revenue Collection Officer (RCO), thru
the Mobile Revenue Collection Officers
System (MRCOS) facility, or duly
Authorized Treasurer of the city or
municipality where said business or
principal place of business / where the
taxpayer is registered, who will issue an
Electronic Revenue Official Receipt
(eROR).

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Donor’ Tax

Donor’s Tax, according to the BIR, is a tax on a donation or gift, and is imposed on the
gratuitous transfer of property between two or more persons who are living at the time of the
transfer. It shall apply whether the transfer is in trust or otherwise, whether the gift is direct or
indirect and whether the property is real or personal, tangible or intangible.
All individuals (juridical and natural, non-residents and residents) must file a Donor's Tax
Return if they transfer some property in the form of the gift (both direct and indirect).
BIR Form 1800 is the applicable form to be used for filing of Donor’s Tax Return. You
must submit this form in triplicate.

To be able to file this form, you must go through the same first procedure we did for filing
the VAT return shown in figure 1 which is filing the eBIR Form main screen. Then, select the
BIR Form 1800 – Donor’s Tax Return from the list of the BIR Forms. After selecting the
applicable form, you can now start filling out the required fields of the aforementioned form.

The form is divided into two parts. The first part includes the date of donation, amended
return, donor’s TIN, RDO code, telephone number, donor’s name and registered address,
donee’s name and registered address, and TIN, the relationship of Donee to the Donor, and
indicate whether or not you are availing of tax relief under a Special Law/International Tax
Treaty, if yes, specify what is it.

The second part of the form is the part devoted to tax computation. At the bottom of the form
there are payment details. There are the schedules where you must provide the description of
the property. There is also a donor’s tax table.

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Flow Chart
Filing of Donor’s Tax Return

Is there a
“Completed Gift”? Who shall
file?
Donor
Yes No
any person, natural or juridical,
The donor shall accomplish, resident or non-resident, who
under oath a donor’s tax transfers or causes to transfer
return in duplicate, setting property by gift, whether in trust
or otherwise, whether the gift is
• Each gift made during direct or indirect and whether the
the calendar year; property is real or personal,
• The deductions
Whe
claimed and allowable;
n? Shall be filed within thirty (30)
• Any previous net gifts
made during the same days after the date the gift
calendar year; (donation) is made.
• The name of the Wher
donee; and e? shall be filed with authorized agent
• Such further bank (AAB); the Revenue District
information as the CIR Office (RDO) of the place of
residence of the donor; with RDO
No. 39-South Quezon City, if the
donor doesn’t have a legal residence
in the Philippines; or with the
Philippine Embassy or Consulate of

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Estate Tax
Estate Tax is a tax on the right of the deceased person to transmit his/her estate to his/her
lawful heirs and beneficiaries at the time of death and on certain transfers, which are made by
law as equivalent to testamentary disposition. It is not a tax on property. It is a tax imposed
on the privilege of transmitting property upon the death of the owner.

An Estate Tax return must be filed if the estate consists of registered property, vehicles, stock
shares or anything that requires a clearance from the Philippines Bureau of Internal Revenue
(BIR) and/or the gross value of the estate is more than ₱200,000. The executor or
administrator or legal heirs of the estate is responsible for the filing of Estate Tax Return. The
estate tax return form for estates is the BIR Form 1801.

Before you can start filling out this form, the same with the previous taxes that must gone
through, you must fill up first the taxpayer profile in the main screen of the eBIR Form as
shown in the Figure 1. Then, select the BIR Form 1801 - Estate Tax Return from the list of
the BIR Forms. After selecting the applicable form, you can now start filling out the required
fields of the aforementioned form.

The return is filed under the name and taxpayer identification number (TIN) of the decedent.
On it, you’ll report estate income, gains, and losses, and will claim deductions for the estate.
You don’t have to include a copy of the will when you file the return.

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Illustration
Mr. Jiraiya Cunanan, a resident Filipino citizen and a head of a family, died leaving the
following property with their corresponding FMV at the time of his death:
● House and lot in San Simon, Pampanga(Family Home) P20,450,000
● Real and personal properties 5,000,000

The following are being claimed by his executor as deductions:

● Actual funeral expenses P100,000
● Judicial expenses 40,000
● Claims against the estate 500,000
● Claims against insolvent debtor 400,000
● Medical expenses 500,000
● Family Home

####Additional Information:
● The Family Home is a conjugal property.
● Real and personal properties include: P5,000,000

○ Palayan Field in Pampanga P2,500,000

○ Bank deposit at BDO in San Fernando, Pampanga 1,875,000

● Claims against Mr. Santos, a debtor declared insolvent has assets worth P4M while
his liabilities P10M.
● Medical expenses incurred two months before death

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Compute for the:
1. Gross Estate
2. Total Deductions
3. Net Taxable Estate
4. Estate Tax

Computation:#### must be conjugal later

Family Home P15,450,000

Real and personal properties 5,000,000
Gross Estate P20,450,000

Less: Allowable Deductions

Ordinary Deductions
Claims against the estate 500,000
Claims against Mr. Santos 240,000

Special Deductions
Family Home 10,000,000
Standard Deduction 5,000,000
Total Deductions P15, 740, 000

Net Taxable Estate P 4,050,000

Estate Tax Due (P4, 050,000×6%) P243, 000

Notes:
1. Although the family home is valued at P30 million, the maximum allowable deduction for
the family home is P10 million only.
2. Claims against Mr. Santos
Still collectible:
A/R P160, 000 (P400, 000 x P4M/P10M)
Deductible from Gross Estate:
P240, 000 (P400, 000-P160, 000)
3. Medical expenses are treated as a special item of deduction.

Allowable Deductions:
*Funeral & Judicial & Medical Expenses are not deducted under TRAIN Law (RA10963)

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Flow Chart
Filing of Estate Tax Return
Who will file the estate tax return?
When is an Estate Tax return required to be filed?
When to file and pay?

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Bibliography :
(1)https://www.7-eleven.com.ph/about/vision-mission-core-values
(2)https://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=9531515

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