Personal Exemptions



Personal exemptions are arbitrary amounts allowed for personal, living or
family expenses of the taxpayer.  The amount has been calculated to be
roughly equivalent to the minimum of subsistence.

Taxpayers Allowed:

Resident aliens
Non-resident  aliens  engaged  in  trade  or  business  in  the  Phil.,
on  the  basis  of reciprocity.

Kinds of Personal Exemptions:

The basic personal exemption (personal exemption of the taxpayer
The additional exemption for qualified dependent children.

Amount of Basic Personal Exemption:

Personal exemption proper:
P50,000 – for each individual taxpayer. In the case of married individuals
  where only one of the spouses is deriving gross income,
  only such spouse shall be allowed the personal exemption
  of P50,000.

Amount of Additional Exemption :i

Additional exemption:
P25,000 – for each legitimate, recognized illegitimate, or legally adopted
  child chiefly dependent upon and living with the taxpayer,
  if such dependent is not more than twenty-one (21) years
  of age, unmarried, and not gainfully employed or if such
  dependent, regardless of age, is incapable of self-support
  because   of   physical   or   mental   defect.   PROVIDED
  HOWEVER, that the total number of qualified dependent
  children for which additional exemption may be claimed
  shall not exceed 4 dependents. PROVIDED FURTHER, that
  the additional exemption for qualified dependent children
  shall be claimed by only one of the spouses in the case of
  married  individuals.  The  husband  shall  be  deemed  the
  proper claimant of the additional exemption with respect
  to any qualified dependent children, unless he explicitly
  waives his right in favor of his wife in the withholding
  exemption  certificate.  In  the  case  of  legally  separated
  spouses, additional exemption may be claimed only by the
  spouse who has custody of the child or children, provided
  that the total amount of additional exemptions that may
  be  claimed  by  both  spouses  shall  not  exceed  the
  maximum  additional  exemptions  allowed  for  4  qualified
  dependent children only.

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About Jonathan Ruiz CPA

Entrepreneur, CPA Mentor, Stock market Newbie Mentor, Influential Author and Master's Degree in International Business graduate in Hult International Business School, UK. A father of two lovely daughters.
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