Gross income refers to all income one receives, regardless of the source. It doesn't matter if the source is legal or illegal. The NIRC gives a list, but it isn't an exclusive one:
1.) Compensation for services, regardless of the form of compensation, not limited to salaries, wages, commissions and similar items.
2.) Gross income from business or practice of profession.
3.) Income from property dealings.
4.) Interests
5.) Rentals
6.) Royalties
7.) Annuities
8.) Prizes/winnings
9.) Pensions
10.) A partner's distributive share in the net income of a general professional partnership.
There are forms of income that are excluded from the gross income. These are the following:
1.) Life insurance proceeds paid to the heirs or beneficiaries when the insured dies.
2.) Money received by the insured as a return of premiums he paid under life insurance.
3.) Value of property acquired by gift, bequest, devise or descent (but the income from the property is included in the gross income.
4.) Compensation for injuries and sickness.
5.) Income exempt under treaty.
6.) Retirement benefits of officials and employees of private firms/companies in accordance to a reasonable private benefit plan made by the employer (the retiree must have worked for the company for at least 10 years and is at least 50 years old.)
7.) Separation pay from the employer to received by an employee, official or his heirs because of death, sickness, other physical disability or any cause beyond his control.
8.) Social security benefits, retirement pensions and other benefits received from foreign government agencies and other public or private institutions.
9.) Payment of benefits from the US Veterans Administration.
10.) Benefits received from the SSS and GSIS.
11.) Income from a foreign government, the Philippine government or any of its political subdivisions.
12.) Prizes and awards made primarily in recognition of religious, charitable, scientific, educational, artistic, literary or civic achievement (the recipient must have been selected without any action on his part to enter the contest/proceeding and is not required to render substantial future services as a condition to receive the prize/award.)
13.) Prizes and awards to athletes in local and international competitions in sports sanctioned by their national sports associations.
14.) 13th month pay, productivity incentives and Christmas bonus totaling up to a maximum amount of Php30,000.
15.) GSIS, SSS, Medicare and Pag-ibig contributions and union dues of individuals.
16.) Gains from sale, exchange or retirement of bonds, debentures or other certificates of indebtedness with a maturity of more than 5 years.
17.) Gains from redemption of shares of stock in a mutual fund company.
18.) Statutory minimum wage, including holiday pay, overtime pay, night shift differential, and hazard pay received by minimum wage earners.
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