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RMC No. 36-2024: Clarification on the manner of computing the Minimum Corporate Income Tax (MCIT) for Taxable Year 2023

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Summary

RMC No. 36-2024 clarifies how the Minimum Corporate Income Tax (MCIT) is computed for Taxable Year 2023, given the change in MCIT rate during that year.

Key points

  1. Rate change. RA No. 11534 (CREATE Act) set a one percent (1%) MCIT for July 1, 2020 until June 30, 2023. Effective July 1, 2023, the rate returned to two percent (2%) of gross income.
  2. How to compute. Gross income is divided by 12 months to get average monthly gross income. The 1% rate applies to January 1 to June 30, 2023 and the 2% rate to July 1 to December 31, 2023.
  3. Ready-made rates. A table gives rates by accounting period for convenience, for example 1.50 for CY 12-31-23, 1.08 for FY 7-31-23 and 2.00 for FY 6-30-24.

Who is affected

  • Corporations subject to MCIT for Taxable Year 2023

Deadlines and effectivity

  • 1% MCIT for January 1 to June 30, 2023
  • 2% MCIT for July 1 to December 31, 2023

Summary by Tax Resources PH. It is not a substitute for the full text of the issuance or professional advice.

Copies of BIR issuances are hosted here for reference. For the official version, check bir.gov.ph. Summaries by Tax Resources PH are not a substitute for the full text or professional advice.