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03 TAX > Business Tax > Flashcards

Business Tax Flashcards

1
Q

What are the VAT exempt transactions pertaining to agricultural and marine products and inputs relative thereto?

A

(1) Sale or importation of
- agricultural and marine food products in their original state
- livestock and poultry used as or yielding or producing foods for human consumption
- breeding stock and genetic materials of livestock and poultry

(2) Sale or importation of
- fertilizers
- seed, seedlings and fingerlings
- fish, prawn, livestock
- poultry feeds including ingredients

Original state
- meat, fruits, vegetables and agri or marine food products which undergone simple processes of preparation or preservation for the market (e.g. freezing, drying, salting, broiling, roasting, smoking or stripping)
- polished or husked rice
- corn grits
- raw cane sugar (muscovado) and molasses
- ordinary salt
- copra

Specialty feeds are not exempt.

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2
Q

What are the VAT exempt services pertaining to agricultural-related transactions and milling transactions?

A
  • Services by agricultural contract growers
  • Milling for others of palay into rice, corn into grits, and sugar cane into raw sugar
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3
Q

What are the VAT exempt importation by resident citizens, non-resident citizens, and/or overseas Filipinos

A

(1) Importation of personal and household effects belonging to RCs and NRCs coming to resettle in the Philippines (must be exempt from customs duties)
(2) Importation of professional instruments and implements, tools of trade, occupation or employment, wearing apparel, domestic animals, and personal household effects
- belonging to persons coming to settle in the Philippines, or Filipinos

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4
Q

What are VAT exempt medical-related transactions?

A

(1) Medical, dental, hospital and veterinary services except those rendered by professionals (i.e. not under an employee-employer relationship)

(2) Sale or importation of prescription drugs and medicines (list of aproved drugs and medicines of the DOH) for:
- diabetes, high cholesterol, and hypertension (beg. Jan 1, 2020)
- cancer, metal illness, tuberculosis, and kidney diseases (beg. Jan. 1, 2021)

  • Laboratory services - exempt
  • Sales made by drugstore to in-patients which are included in the hospital bills - exempt
  • Sale of drug store to out-patient - taxable (not part of medical services of the hospital)
  • HMOs - VATable, unless they directly provide medical services to their clients
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5
Q

COVID-related

A
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6
Q

What are the VAT exempt transactions of agricultural cooperatives duly registered with the CDA?

A
  • Sale (whether own produce or not) to their members
  • Sale of their own produce to non-members
  • Importation of direct farm inputs, machineries and equipment (incl. spare parts) to be used directly and exclusively in the production and/or processing of their produce
  • Sale or importation of an agricultural food product in original state to members and non-members
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7
Q

What are the VAT exempt transactions of credit or multi-purpose cooperatives duly registered with the CDA?

A

Gross receipts from lending activities to members and non-members

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8
Q

What are the VAT exempt transactions of non-agricultural, non-electric, and non-credit cooperatives duly registered with the CDA?

A

Sale transactions if the share capital contribution per member does not exceed P15,000

regardless of the aggreagate capital and net surplus ratably distributed among the members

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9
Q

What are the VAT exempt transactions of non-VAT registered persons?

A

Export sales

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10
Q

What are the VAT exempt sale of real properties?

A
  • Sale of RP not primarily held for sale to customers, held for lease in the ordinary course of business, or or used in trade or business (i.e. sales subject to CGT)
  • Sale of RP utilized for socialized housing, wherein the price ceiling per unit is P450,000 or as may from time to time be determined by the HUDCC and the NEDA and other related laws
  • Sale of house and lot and other residential dwellings with selling price of not more than 3,199,200
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11
Q

What are the VAT exempt lease transactions?

A
  • Lease of residential unit with a monthly rental not exceeding P15,000 (regardless of the amounts of aggregated rentals received by the lessor during the year)
  • Lease of residential unit with a monthly rental exceeding P15,000, but the aggregate rental income of the lessor during the year do not exceed P3,000,000 (this is subject to percentage tax)

The lease of residential unit with a monthly rental not exceeding 15,000 is also exempt from percentage tax

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12
Q

What are VAT exempt educational-related transactions?

A

Educational services rendered by
- private educational institutions duly accredited by DepEd, CHED, or TESDA
- government educational institutions

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13
Q

books

A
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14
Q

What are the VAT exempt transactions of international carriers doing business in the Philippines (RFC)?

A
  • Transport of passengers originating in the Philippines
  • Transport of cargo or goods originating in the Philippines (subject to common carrier’s tax)
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15
Q

What are the VAT exempt transactions of domestic common carriers?

A

Transport of passenger within the Philippines by land (subject to common carrier’s tax)

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16
Q

What are the zero-rated VAT transactions of domestic common carriers?

A

Transport of passengers and cargo/goods or mails from Philippines to abroad

17
Q

What are the 12% VAT transactions of domestic common carriers?

A
  • Transport of passengers by air or sea within the Philippines
  • Transport of cargo/goods or mails within the Philippines
18
Q

What are the VAT exempt transactions to

A
  • Sale, importation or lease of passenger or cargo vessels and aircraft, including engine, equipment and spare parts for domestic or international transport operations

MARINA requirment

19
Q

What are the VAT exempt transactions of persons engaged in international shipping or air transport operations?

A

Importation of fuel, goods and supplies

provided that such shall be exclusively or shall pertain to the transport of goods and/or passengers from a port in the Philippines directly to a foreign port without stopping at any other port in the Philippines

20
Q

What are the VAT exempt transactions to senior citizens and PWDs?

A

Sale of goods and services subject to the 20% discount

21
Q

What are the VAT exempt transfers of property?

A
22
Q

Association dues

A
23
Q

What is the VAT exempt sale of gold?

A

Sale of gold to the BSP

takes effect on Jan. 1, 2018

24
Q

RAHQ

A
25
Q

Special laws

A
26
Q

Employee

A
27
Q

% tax

A
28
Q

banks

A
29
Q

What are the zero-rated export sales?

A

(1) Sale and actual shipment of goods from the Phil. to a foreign country and paid for in acceptable currency, and in accordance with the rules and regulations of the BSP

(2) Sale of goods, supplies, equipment, and fuel and sale of services (incl. leases of property) rendered to persons engaged in international shipping or air transport operations, provided that these shall pertain to the transport of goods and passengers from a Philippine port directly to a foreign port, or vice-versa, without docking or stopping at any other port in the Philippines.

30
Q

What are the zero-rated transactions by a domestic air or sea carriers?

A

Transport of passengers and cargo form the Phil. to a foreign country

Transport of passengers and cargo by domestic air or sea carriers from a foreign country to the Philippines is EXEMPT from business taxes including the VAT due to lack of jurisdiction.

31
Q

What are the effectively zero-rated sales?

A

Local sales of goods and services by VAT-registered persons to persons or entities deemed tax-exempt (i.e., granted exemption from indirect taxes) under a special law or international agreement, such as:
- ADB, IRRI
- diplomatic missions and other agencies or instrumentalities granted tax immunities
- Regional or area headquarters of MNCs enjoying VAT zero-rating on its purchases
- Qualified foreign embassies or resident foreign missions5 which have been issued a VAT Certificate (“VC”), and their personnel and their dependents who have been issued a VAT Identification Card (“VIC”), on purchases of goods and services in the Philippines
- Other persons/entities who are entitled to 0% VAT on purchases

32
Q

What are the zero-rated sales to registered export enterprises?

A

Sale of raw materials, inventories, supplies, equipment, packaging materials, and goods, and sale of services rendered to a registered export enterprise to be used directly and exclusively in its registered project or activity pursuant to Section 294(E) and 295(D) of the Tax
Code.7

The zero-rating of such sales shall be for a maximum period of seventeen (17) years
from the date of registration of the export enterprise, unless otherwise extended under
the Strategic Investment Priority Plan (“SIPP”)

A registered export enterprise (“REE”) is a registered business enterprise9 engaged
in manufacturing, assembling or processing, or services such as information
technology activities and business processing outsourcing, and resulting in (a) the
direct exportation, and/or (b) sale of its products or services to another registered
export enterprise that will form part of the final export product or service of the
latter, of at least 70% of its total production or output.

33
Q

What are the zero-rated sales to offshore gaming licensees (OGLs)?

A

Sale of goods or properties and services to OGLs subject to the gaming tax
- the OGL is paying the 5% gaming tax
- the goods supplied are used in gaming operations

34
Q

What are the environmental-related zero-rated transactions?

A

Sale of power or fuel generated through renewable sources of energy (such as solar, wind, biomass, geothermal, and ocean energy) and ancillary services

Zero-rating does not extend to the sale of services related to maintenance or operating of plants generating said energy.

35
Q

Services in foreign currency

A
36
Q
A

03 TAX (6 decks)

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