Absence of employment arrangement: Tax effect | Fulvio D. Dawilan

The Philippines has carved itself as a favorite outsourcing jurisdiction for foreign businesses for a number of reasons. The traditional scheme is through the establishment of subsidiaries or branches in the country, and services are rendered to both foreign and local clients through these entities. With these being taxable entities, it is less likely that another taxable entity is deemed created.

In essence, the nature of the arrangements between the foreign business and the individuals would also affect the tax impact to both parties. But let me defer the discussion of the tax consequences to the individuals to a later article. In the meantime, let me discuss the tax impact to the supposed foreign employer or principal, specifically in relation to the assignment of employees in the Philippines.

We have not formally adopted the economic employer rule. But our tax laws had adopted the labor laws in so far as the determination of the existence of an employer-employee relationship is concerned. And these rules espouse the so-called four-fold test in determining the existence of an employer-employees: who hires the employees, who pays their wages, who has the power to dismiss, who has the power of control, with the last one being the most important.

Philippines Latest News, Philippines Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Road user’s tax hike needs further study–traders | Andrea E. San JuanTHE Philippine Exporters Confederation Inc. (Philexport) is proposing that lawmakers should address first the issue of the increasing volume of cars on the road and the development of mass transportation in the country before imposing an increase in the road user’s tax. “Pag-aralan muna ’yung road users tax dahil [kailangang]…
Source: BusinessMirror - 🏆 19. / 59 Read more »

Judy Ann reveals desire to work with young superstarsGIVEN her absence from the TV and silver screens, people are keen to witness Judy Ann Santos, affectionately known as
Source: MlaStandard - 🏆 20. / 55 Read more »

Lending a helping hand to Filipinos in the USIN the ever-changing landscape of US tax regulations and laws, individuals and businesses alike are faced with the daunting task
Source: MlaStandard - 🏆 20. / 55 Read more »

US plea proposal for 9/11 suspects splits victims’ relativesWhile the prosecutors said no deal was finalized, the letter was confirmation that such an arrangement appears to be where
Source: MlaStandard - 🏆 20. / 55 Read more »

Judy Ann reveals desire to work with young superstarsGIVEN her absence from the TV and silver screens, people are keen to witness Judy Ann Santos, affectionately known as
Source: MlaStandard - 🏆 20. / 55 Read more »

Lending a helping hand to Filipinos in the USIN the ever-changing landscape of US tax regulations and laws, individuals and businesses alike are faced with the daunting task
Source: MlaStandard - 🏆 20. / 55 Read more »