Practice question
A foreign corporation has PHP6 million Philippine-source gross income and PHP10 million worldwide gross income for the relevant statutory period. It pays a PHP100,000 dividend. Assuming the Section42 period and other facts are established, how much is Philippine-source under the ratio rule?
- PHP60,000
- PHP100,000 solely because some income is Philippine-source
- PHP40,000
- Zero solely because the corporation is foreign
- PHP6 million
Legal references
- NIRC RA8424, relevant provisions as amended: https://lawphil.net/statutes/repacts/ra1997/ra_8424_1997.html Section42(A)(2),(4),(C)(4),(E).
- RA12214 CMEPA: https://lawphil.net/statutes/repacts/ra2025/ra_12214_2025.html Section12, current Section42(A)(1) amendment checked.
- Aces Philippines v. CIR, GR226680, August30 2022 ENBANC MAIN: https://lawphil.net/judjuris/juri2022/aug2022/gr_226680_2022.html MAIN income-producing activity and Philippine gateway receipt.
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