Corporations, Partnerships And Other Non-Individuals Who Are Not Entitled To Avail The Optional Standard Deductions (OSD)

In Section 5. A. of Revenue Regulations (RR) No. 2 -2014, stated that Corporations, partnerships and other non-individuals are mandated to use the itemized deductions in the following cases:

1. Those exempt under the Tax Code, as amended (Section 30 and those exempted under Section 27(C) and other special laws, with no other taxable income;

2. Those with income subject to special/preferential tax rates; and 

3. Those with income subject to income tax rate under Section 27(A) and 28(A)(1) of the Tax Code, as amended, and also with income subject to special/preferential tax rates.

Judicial entities whose taxable base is the gross revenue or receipts (e.g., non-resident foreign international carriers) are not entitled to the itemized deductions nor to the optional standard deduction (OSD) under Section 34(L) of the Tax Code, as amended.

Please refer http://www.bir.gov.ph/images/bir_files/old_files/pdf/82202RR%20No%20%202-2014.pdf the full text of RR No. 2-2014. and http://www.bir.gov.ph/index.php/tax-code.html and full text of the Tax Code.