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    Minimum Corporate Income Tax 3

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    Naik
    1) Any excess minimum corporate income tax (MCIT) over regular corporate income tax (RCIT) can be carried forward and credited against RCIT for the next 3 years, provided the RCIT is higher than the MCIT in those years. 2) For a company with income of P10M in 2018, P12M in 2019, and P14M in 2020, the income tax payables would be P200k, P240k, and P10k respectively after applying excess MCIT from prior years. 3) When computing quarterly tax payments, excess MCIT from prior years cannot be credited if the current quarter's MCIT is higher than RCIT, but withholding and other quarter

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    Minimum Corporate Income Tax 3

    Uploaded by

    Naik
    38 views5 pages
    1) Any excess minimum corporate income tax (MCIT) over regular corporate income tax (RCIT) can be carried forward and credited against RCIT for the next 3 years, provided the RCIT is higher than the MCIT in those years. 2) For a company with income of P10M in 2018, P12M in 2019, and P14M in 2020, the income tax payables would be P200k, P240k, and P10k respectively after applying excess MCIT from prior years. 3) When computing quarterly tax payments, excess MCIT from prior years cannot be credited if the current quarter's MCIT is higher than RCIT, but withholding and other quarter

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    1) Any excess minimum corporate income tax (MCIT) over regular corporate income tax (RCIT) can be carried forward and credited against RCIT for the next 3 years, provided the RCIT is higher than the MCIT in those years. 2) For a company with income of P10M in 2018, P12M in 2019, and P14M in 2020, the income tax payables would be P200k, P240k, and P10k respectively after applying excess MCIT from prior years. 3) When computing quarterly tax payments, excess MCIT from prior years cannot be credited if the current quarter's MCIT is higher than RCIT, but withholding and other quarter

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    38 views5 pages

    Minimum Corporate Income Tax 3

    Uploaded by

    Naik
    1) Any excess minimum corporate income tax (MCIT) over regular corporate income tax (RCIT) can be carried forward and credited against RCIT for the next 3 years, provided the RCIT is higher than the MCIT in those years. 2) For a company with income of P10M in 2018, P12M in 2019, and P14M in 2020, the income tax payables would be P200k, P240k, and P10k respectively after applying excess MCIT from prior years. 3) When computing quarterly tax payments, excess MCIT from prior years cannot be credited if the current quarter's MCIT is higher than RCIT, but withholding and other quarter

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 5

    EXCESS MCIT OR MCIT CARRY-OVER

    Any excess of the minimum corporate income tax


    over the normal corporate income tax shall be carried
    forward and credited (deducted) against the regular
    income tax for the three succeeding taxable years,
    provided, that the RCIT should be higher than the
    MCIT in the year to which the excess MCIT is
    forwarded.
    COMPUTATION:
    A domestic corporation which commenced
    operations in 2014 provided the following data:
    2018 2019 2020
    Gross Income P10MP12M P14M
    Allowable deductions (9.5M) (12.2M) (12.8M)
    Net Income (loss) P500k P(200k) P1.2M

    Determine the income tax payable for 2018, 2019 and


    2020.
    EXCESS MCIT OR MCIT CARRY-OVER

    2018 2020

    RCIT or Basic tax (P500k P150,000 Net income P1,200,000


    x 30%) Less: 2019 NOLCO (200,000)
    MCIT (P10M x 2%) 200,000 Taxable income 1,000,000
    Tax Due/payable (Higher P200,000
    amount) RCIT or Basic Tax (P1M x P300,000
    30%)
    Excess MCIT 2018 P50,000
    MCIT (P14M x 2%) 280,000
    2019 Tax Due/payable (Higher P300,000
    RCIT or Basic tax P0 amount)
    MCIT (P12M x 2%) 240,000 Less: Excess MCIT
    Tax Due/payable (Higher P240,000 2018 (50,000)
    amount) 2019 (240,000)
    Excess MCIT 2019 P240,000 Income Tax Payable 2020 P10,000
    QUARTERLY AND ANNUAL CORPORATE TAX DUE

    ✔ If the computed quarterly MCIT is higher than the quarterly normal


    income tax, the tax due to be paid is 2% of the gross income
    ✔ In payment of said ‘quarterly’ MCIT:

    1. Excess MCIT from the previous taxable year(s)


    shall not be allowed to be credited if the MCIT
    is higher tha RCIT.
    2. The expanded witholding tax, quarterly
    corporate income tax and income paid in the
    previous taxable quarter(s) are allowed to be
    applied regardless if the MCIT is higher or not.
    COMPUTATION:
    A corporation’s computed Regular Corporate Income Tax
    (RCIT), MCIT and Income Taxes withheld from 1st to 4th quarters
    including excess , MCIT and Excess withholding taxes from
    prior year(s) are as follows:
    Quarter RCIT MCIT Taxes Excess MCIT Excess
    Withheld Prior Year Withholding
    during the Tax (Prior
    year Year)
    1st P200,000 160,000 40,000 60,000 20,000
    2nd 240,000 500,000 60,000 - -
    3rd 500,000 200,000 80,000 - -
    4th 400,000 200,000 70,000 - -

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