Bureau of Internal Revenue

Arcita 06:45 AM, Feb 01, 2023

February 1, 2023

Dear Ms. Padasas:

I refer to my letter of Jan 29, 2023 01:07:52 AM about your request under Executive Order No. 2 (s. 2016) on Freedom of Information in the Executive Branch, for Tax Exemption Certificate (CTE) for Overseas Filipino Worker (OFW).

In reply, please be informed of Section 3 of Revenue Regulations No. 1-2011, which states that:

A.) Income Taxes: Section 23 (C) of the National Internal Revenue Code of 1997, as amended states that an individual citizen of the Philippines who is working and deriving income from abroad as an Overseas Contract Worker (OCW) is taxable only on Income from Sources Within the Philippines: Provided, that a seaman who is a citizen of the Philippines and who receives compensation for services rendered abroad as a member of the complement of a vessel engaged exclusively in international trade shall be treated as Overseas Contract Worker (OCW).  

Thus, an OCW or OFW's income arising out of his overseas employment is exempt from income tax.

However, if an OCW or OFW has income earnings from business activities or properties within the Philippines, such income earnings are subject to Philippine Income Tax.

For assistance, kindly email the requested information at sherry.ann.arcita@bir.gov.ph and indicate in the subject email ticket number #BIR-819562820859, to respond.

During the period of us awaiting your reply, your request will be put on hold. If we do not receive a reply on or before Apr 25, 2023 10:37:27 PM, your request will be closed.

We hope to hear from you at the soonest possible time.

Thank you.

Respectfully,

FOI Receiving Officer
Public Information and Education Division