ASSESSMENT TEST: INCOME TAXATION

Test I.
A. Classification of Individual Taxpayer. Write whether taxable or non-taxable on each table provided.
Taxpayer Income Within the Philippines Income Outside the Philippines
1. Resident Citizen
2. Non-resident Citizen
3. Resident Alien
4. Non-resident Alien

B. Passive Income subject to Final Tax for Individuals. Write the rate applicable on each passive income.
Passive Income Final Tax
5. Interests, royalties, prizes and other winnings except, if
prizes does not exceed P10,00
6. Royalties on books literary works and musical compositions
7. Interest income received by an individual taxpayer from a
depository bank under the expanded foreign currency deposit
system
8. Interest income from long term investment held for more than
5 years and in accordance with the prescribed rule
9. Cash and/or property dividends
10. Capital gains from sale of shares of stocks not traded in the
stock exchange
11. Capital gains from sale of real property

Test II. Identification/ Enumeration

A. Personal Exemption

12. Basic Personal Exemption

13. Additional Personal Exemption
14. Proper claimant of Additional Personal Exemption
15-17. Exception to rule on proper claimant of Additional Personal Exemption

B. Filing of returns and administrative requirements

Where to file:
18. If such person has his legal residence or principal place of business in the Philippines
19. If such person has no legal residence or principal place of business in the Philippines

When to file and pay:

20. If such person is purely compensation earner
21. If such person is earning from the practice of profession

Test III. Problem Solving

The taxpayer is a citizen of the Philippines, residing in the Philippines.
Selling price, at fair market value, on a direct sale to a buyer of
shares of stock of a domestic corporation held as capital asset P600,000
Cost of shares of stock 540,000
22. The capital gain tax is?

The taxpayer is a citizen of the Philippines, residing in the Philippines. Real property in the Philippines sold was held
as capital asset:
Selling Price P5,000,000
Fair market value at the time of sale 5,500,000
Expenses of the sale 200,000
Cost of the real property 4,000,000
23. The capital gain tax is?

The taxpayer is a resident citizen of the Philippines with the following data in a calendar year:
Net income from business P2,500,000
Interest on Philippine peso bank savings deposit with the Bank
Of the Philippines 40,000
Interest on Philippine peso bank time deposit at the Banco de Oro,
With maturity of five years 50,000
Interest on bonds of Banko Sentral ng Pilipinas 30,000
Interest on foreign currency deposit under the expanded foreign
Currency deposit system 100,000
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ASSESSMENT TEST: INCOME TAXATION

Dividend from a domestic corporation 40,000

Dividend from a resident foreign corporation 20,000
Royalties from books authored 100,000
24. The Final tax on passive income is?
25. How much was the passive income of the year net of final tax?

Mr. Luis Mansanilla, a resident citizen, had income from within and outside the Philippines. Data for a year:

Gross income, within the Philippines P120,872.94

Gross income, outside the Philippines 190,425.30
Deductible expenses, within the Philippines 58,924.65
Deductible expenses, outside the Philippines 156,539.41
26. How much was the income tax at the end of the year?

A citizen and resident of the Philippines had the following data within a calendar year:

Gross income from business P800,000

Expenses of the business 350,000
Interest on Philippine currency bank deposit 10,000
Dividend from a domestic corporation 8,000
Capital gain on direct sale to buyer of shares of stock of a
Domestic corporation (on a selling price of P100,000) 20,000
Capital loss on sale of land in the Philippines (on a selling of P10M) 200,000
27. Capital gain tax?
28. Final tax?
29. Graduated income tax for the year?
30. Total of income taxes for the year?

Mr. Ruben Cancio, is a citizen and resident of the Philippines. The following data were on his business net income
in each of the quarters of a year:
First quarter P220,000
Second quarter 309,500
Third quarter 294,650
Fourth quarter 324,300
The income tax due at the end of:
31. First quarter?
32. Second quarter?
33. Third quarter?
34. Year?

Compute the amount of personal exemption (basic and additional personal exemption) for each of the following
independent cases.

35. The taxpayer, a citizen of the Philippines, has an illegitimate child, two years old.

36. The taxpayer are husband and wife, citizens of the Philippines, both with compensation
Income, with six qualified dependent children.

37. The taxpayer is a citizen of the Philippines, had a qualified dependent child at the
beginning of the year. Within the child died.

38. The taxpayer, citizen of the Philippines, had a qualified dependent child at the beginning of
the year. Within the year the child became gainfully employed.

39. The taxpayers are husband and wife, citizens of the Philippines, with six qualified dependent
children. The husband is in business, wife in the practice of profession.

40. The taxpayer, citizen of the Philippines had a child twenty four years old.
Within the year the child became insane.

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ASSESSMENT TEST: INCOME TAXATION
-END OF EXAMINATION-

All achievement, all earned riches, have their beginning in an idea.

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ASSESSMENT TEST: INCOME TAXATION
ANSWER KEY
1-4
5. 20%
6. 10%
7. 7.5%
8. exempt
9. 10%
10. 5% for not over P100,000 and 10% for in excess of P100,000
11. – 6% based on the gross selling price or current fair market value, whichever is higher

12. 50,000
13. 25,000
14. Husband
15. Husband is unemployed
16. Husband is non-resident citizen deriving income from foreign sources
17. Husband waives his right to claim the exemptions of children (waiver should be for all children) in a sworn
statement to be attached to his Application for Registration (BIR Form No. 1902) and that of his wife's

18-19. Where to file – AAB, RDO, Collection Agent or duly authorized Treasurer of the city or municipality in
which such person has his legal residence or principal place of business in the Philippines, or if there be no legal
residence or place of business in the Philippines, with the Office of the Commissioner.

20. Every individual receiving self-employment income ► On or before April 15 of the same taxable year
21. Quarterly income tax return – payment shall be made in 4 installments.
1st installment: at the time of the declaration (on or before April 15)
2nd installment: on or before August 15 of the current year
3rd installment: on or before November 15 of the current year
4th installment: on or before April 15 of the following calendar year

Annual income tax return ► Lump sum payment: on or before April 15 of the following calendar year ► Installment
payment: applicable if tax due is in excess of P2,000
July 18, 2012 Slide 33 Taxes Common to Taxpayers
p y pp ,  1st installment: at the time the return is filed  2nd installment: on or before July 15 following the close of
the calendar year

22. 3,000
23. 330,000
24. 29,500
25. 300,500
26. 4,875.13
27. 601,000
28. 2,800
29. 95,000
30. 698,800
31. 42,500
32. 91,940
33. 94,288
34. 87,776

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