CHAPTER 5

Question 1

WHAT IS PASSIVE INCOME (SUBJECT TO FINAL TAX)

Answer 1

• NO SO MUCH EFFORT (ACTIVE PARTICIPANT)
• NOT ON REGULAR BASIS
• DOMESTIC

Question 2

WHAT IS ACTIVE INCOME (3)

Answer 2

COMPENSATION (SWELDO)
BUSINESS
PROFESSION
BASTA ACTIVE INC

Question 3

WITHOLDING TAX PRIOR THE RECEIPT OF PAYEE

Answer 3

PAYOR WILL:
DEDUCT CERTAIN PERCENTAGE
REMIT TO THE GOVERNMENT
PRIMARY LIABLE

WHILE PAYEE:
NO OBLIGATION
ACCEPTANCE OF NET INCOME (TAX FREE)

Question 4

FINAL INCOME TAX IS? (4)

Answer 4

TAX WITHOLDING AT SOURCE
TERITORIAL IMPOSITION
CERTAIN PASSIVE INCOME

NRA-NETB AND NRFC
(LAHAT NG INCOME SUBJECT TO FINAL TAX OR EXEMPT)

Question 5

INTEREST INCOME ON BANK DEPOSIT

LOCAL CURRENCY DEPOSIT

DEPOSIT SUBTITUTE (SHORT TERM)
%?

Answer 5

20% GENERAL

EXPT NBA-NETB, NRFC 25%

Question 6

INTEREST INCOME ON BANK DEPOSIT

LOCAL CURRENCY DEPOSIT

DEPOSIT SUBTITUTE (LONG TERM)
%?

Answer 6

INDIVIDUALS : EXEMPT

EXPT NBA-NETB, NRFC 25%
EXPT DC, RFC 20%

Question 7

HOW MANY YEAR CONSIDERED AS SHORT TERM DEPOSIT

Answer 7

5YRS N BELOW

Question 8

HOW MANY YEAR CONSIDERED AS LONG TERM DEPOSIT

Answer 8

5YRS ABOVE

Question 9

PRE TERMINATION OF LONG TERM DEPOSIT
(LESS THAN 3YRS) %?

Answer 9

20%

Question 10

PRE TERMINATION OF LONG TERM DEPOSIT
(3YRS - LESS THAN 4YRS) %?

Answer 10

12%

Question 11

PRE TERMINATION OF LONG TERM DEPOSIT
(4YRS - LESS THAN 5YRS) %?

Answer 11

5%

Question 12

INTEREST INCOME ON BANK DEPOSIT

FOREIGN CURRENCY DEPOSIT %?

Answer 12

15% RESIDENT ONLY

XPT NON RESIDENT
XPT NRA-NETB, NRFC
(EXEMPTED)

Question 13

ROYALTIES
(PASSIVE INCOME ONLY) SUBJECT TO FINAL INC TAX
IN GENERAL %?

Answer 13

20% IN GENERAL

EXPT: NRA ETB & NETB, NRFC 25%

Question 14

ROYALTIES
(PASSIVE INCOME ONLY) SUBJECT TO FINAL INC TAX
IN BOOKS, LITERARY WORKS AND MUSICAL COMPOSITION %?

Answer 14

10%

EXPT: NRA ETB & NETB, NRFC 25%

Question 15

ROYALTIES
(PASSIVE INCOME ONLY) SUBJECT TO FINAL INC TAX
CINEMATOGRAP FILMS AND SIMILAR WORKS %?

Answer 15

20%

EXPT: NRA ETB & NETB, NRFC 25%

Question 16

WHAT IS PRIZES

Answer 16

BASED ON EFFORT

Question 17

WHAT IS WINNINGS

Answer 17

BASED ON CHANCE

Question 18

PRIZES 10,000 AND BELOW

Answer 18

SUBJECT TO RIT

XPT: NRA-NETB, NRFC 25 %

Question 19

PRIZES ABOVE 10,000

Answer 19

20% INDIVIDUAL
COPR - RIT
NRA-NETB, NRFC 25 %

Question 20

WINNINGS
IN GENERAL

Answer 20

20% INDIVIDUAL
COPR - RIT
NRA-NETB, NRFC 25 %

Question 21

WINNINGS
IN PCSO OR LOTTO ABOVE 10,000

Answer 21

20%
NRA-NETB, NRFC 25 %

Question 22

WINNINGS
IN PCSO OR LOTTO 10,000 AND BELOW

Answer 22

EXEMPT

NRA-NETB, NRFC 25 %

Question 23

EXEMPTED ON PRIZES (2)

Answer 23

• PRIZES AND AWARD IN RECOGNITION
• PRIZES AND AWARD IN SPORTS ASSOCIATION

Question 24

3 TAXABLE DIVIDENDS

Answer 24

CASH DIVIDEND
PROPERTY DIVIDEND
SCRIP DIVIDEND

Question 25

2 EXEMPT IN DIVIDEND

Answer 25

LIQUIDATING DIVIDEND
STOCK DIVIDENT

Question 26

DIVIDENDS
OTHER ITEM UNDER SPECIAL LAW
DIVIDENDS ON TAX FREE COVENANTS BONDS

Answer 26

30% ONLY INDIVIDUALS

Question 27

INFORMERS REWARD
FINAL TAX %?

Answer 27

10%

Question 28

INFORMER REWARD
REVENUE COLLECTED ( TAX BASED)

Answer 28

10%
OR
1MIL

WHICH EVER IS LOWER