Practice question
One spouse is a qualifying nonresident Filipino citizen and the other a Philippine resident citizen. Each earns separate stipulated foreign-source income attributable solely to that spouse. They argue marriage alone forces identical Section23 source coverage. No treaty or special exception applies. Which is best?
- Marriage automatically converts both into foreign corporations.
- The separate established citizenship/residence classifications remain relevant; marriage alone does not erase their different general source rules.
- Every married couple is necessarily nonresident for income-tax purposes.
- Only the spouse with the larger bank balance determines both classifications.
- All spouses always have identical worldwide coverage regardless of their legal status.
Legal references
- NIRC, Sections 5-7,22-23 and32, as enacted in RA8424 and subject to the cited later amendments: https://lawphil.net/statutes/repacts/ra1997/ra_8424_1997.html
- RA12214, May29,2025, CMEPA, including amended NIRC Sections22,25 and32: https://lawphil.net/statutes/repacts/ra2025/ra_12214_2025.html
- RA12066, CREATE MORE, Section3 amending NIRC32(B)(5) treaty exclusions: https://lawphil.net/statutes/repacts/ra2024/ra_12066_2024.html
Answer this question in flashcards to review your response and continue practicing.