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TAXATION > FR CL > Flashcards

FR CL Flashcards

1
Q

Tax Reform for Acceleration and Inclusion (TRAIN Law} known as

A

RA 10963

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2
Q

Statement 1. Individual taxpayers receiving purely compensation income from only one employer whose income tax has been correctly been withheld by their employer shall not be required to file an income tax return.
Statement 2. Exempts individual taxpayers whose taxable income does not exceed P250,00 tram the requirement to file income tax return.

A

Both statements are true

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3
Q

The date of filing the first quarter tax return for individual taxpayers engaged In business or practice of profession

A

May 15

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4
Q

The deductibility of premium payments on health and/or hospitalization insurance is

A

Not applicable

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5
Q

TRAIN Law eliminates the personal and additional exemption allowances which means that

A

Fixed income earners or compensation income earners will be uniformly taxed on gross
basis, without regard to their circumstances

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6
Q

Statement 1. Income of purely self-employed individuals and/or professionals - Self-employed individuals and/or professionals may, at their option, be subject to either 8% on gross income in excess of P250,000 or regular individual income tax rates_
Statement 2 The 8% tax shall be in lieu of graduated income tax rates and percentage tax.

A

Both statements are true

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7
Q

Statement 1 Under TRAIN Law, PCSO and Lotto winnings are Tax-exempt
Statement 2. Interest income on foreign currency bank deposits increases the tax rate on interest income whether received by an individual taxpayer or corporation) from foreign currency bank deposits from 7.5% to 10%.

A

Both statements are false

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8
Q

Statement 1 UnderTRAIIN Law, capital gains taxon sale of shares of stock are the two-tiered
rate of 5% and 10% tax on sale transfer or exchange of shares of stock_
Statement 2 _ Thee fringe benefit tax (FBT) rate increases from 32% ta 33%.

A

Both statements are false

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9
Q

Tax-exempt threshold for 13th month pay and other bonuses under TRAIN Law is

A

90,000

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10
Q

Statement 1. Under TRAIN Law, the income tax rates for individual taxpayers and corporations
restructures by replacing the existing 5%-32% graduated tax rates with 0%- 35% progressive tax rates with the number of tax brackets reduced from seven to six, and thresholds for each tax bands adjusted_
Statement 2. Under the TRAIN, individual taxpayers and corporations who have less than
P250,000 taxable income fall into the lowest tax bracket, and their income will be subject to 0% income tax rate while the tax rate applicable on the taxable income of those earning above PBM will be. earning from 32% to 35%.

A

Both are false

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11
Q

How many of the following statements are correct?
Statement 1. Compensation income shall be subject ta graduated income tax rates for compensation income.
Statement 2. Those whose gross sales or gross receipts and other non-operating income.
exceed the VAT threshold, shall have the option to be subject to 8% tax based on gross sales or receipts and other non-operating income from business or practice of prafession or graduated income tax rates.
Statement 3. Those whose gross sales or gross receipts and other non-operating income do not exceed the vat threshold has no available option They shall be automatically subject to the graduated income tax rates

A

one

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12
Q

Fringe benefit tax (FBT) rate increase by:

A

3%

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13
Q

Statement 1. Under the TRAIN Law, General Professional Partnerships (GPPs} and the partners
comprising the partnership are not allowed to avail of the optional standard deduction

Statement 2. Under the Train Law, premium payments on health -and/or hospitalization insurance in the amount of P2,400 per family or P200 a month from gross income of individual taxpayers is not deductible.

A

Statement 1 is false, statement 2 is true

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14
Q

Which of the following is tax-exempt?

A

Lotto winnings amounted to 8,000

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15
Q

Statement 1. The list of Tax-exempt corporations includes GSIS but not PCSO.
Statement 2 Interest income of foreign currency bank deposits increased by 15%

A

Statement 1 is true, statement 2 is false

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16
Q

TRAIN Law mandates that the individual income tax return shall consist only of four {4) pages and contain:

I. The personal profile;
II. Net sales or income from compensation or trade or business, or exercise of prnfession
III. Allowable deductions
IV. Gross income
V.Tax due and payable of individual taxpayers

A

I, III and IV only

17
Q

TRAIN law mandates that the corporate income tax return shall consist of a maximum of four {4)
pages and shall contain:

I. The personal profile;
II. Gross sales or income from compensation or trade or business, or exercise of profession
III. Allowable deductions
IV. Gross income
V.Tax due and payable of individual taxpayers

A

II, III and IV only

18
Q

In case of individual taxpayers with tax due in excess of P2,000 and availing of the option to pay their tax due in two equal installments, TRAIN Law moves the due date for paying the second installment from July 15 to:

A

October 15

19
Q

Under the TRAIN Law, individual taxpayers receiving purely compensation income from only one
employer whose income tax has been correctly been withheld by their employer

A

Shall not be required to file an income tax return

20
Q

Statement 1 TRAlN Law provides the privilege to avail of the 15% preferential tax rate on gross income of employees of ROHQs/RHQs, OBUs and Petroleum Contractors and Subcontractors which shall be established starting Jemumy 1, 2018.

Statement2. Existing RHQs, ROHQst OBUs and Petroleum Service Contractors and Sub contractor presently availing of the 15% preferential tax rate for their qualified employees
shall combine to be entitled to avail preferential tax rate for their present and future qualified employees

A

Statement 1 is false, statement 2 is true

21
Q

Atom, a native of Naga City supporting his brother 18 years old, unmarried, not gainfully
employed, studying Bachelor of Science in Accountancy at the University of Santo Thomas, is
entitled to a total personal exemption of -

A

0

22
Q

Clarice, single, supporting his 58-year-old mother, is a business income earner. During the year, his net income was P150,000. She also paid a total premium of P3,000 to an insurance company for her health insurance. How much is her taxable income?

A

150,000

23
Q

Items 23-25 are based on the following information:
Caria received the following income in 2018:
Business income, Philippines P300,000
Business income, United States 250,000
Expenses, Philippines 200,000
Expenses United States 125,000
Interest on deposit with Metrobank 3,000
(interest em deposit in U.D. ($1=P40} $500
Cash prize won in a local contest 6,000
Casin prize won in a contest in U.S. 10,000
Winnings in lotto 20,000
Winnings in lotto in U.S. 50,000
Dividends from SMC, a domestic company 25,000

  1. The taxable income if Carlo is a resident citizen single is -
A

311,000

24
Q

Items 23-25 are based on the following information:
Caria received the following income in 2018:
Business income, Philippines P300,000
Business income, United States 250,000
Expenses, Philippines 200,000
Expenses United States 125,000
Interest on deposit with Metrobank 3,000
(interest em deposit in U.D. ($1=P40} $500
Cash prize won in a local contest 6,000
Casin prize won in a contest in U.S. 10,000
Winnings in lotto 20,000
Winnings in lotto in U.S. 50,000
Dividends from SMC, a domestic company 25,000

  1. The taxable income if Carlo is a non resident alien ETB married with five dependent minor children
A

106,000

25
Q

Items 23-25 are based on the following information:
Caria received the following income in 2018:
Business income, Philippines P300,000
Business income, United States 250,000
Expenses, Philippines 200,000
Expenses United States 125,000
Interest on deposit with Metrobank 3,000
(interest em deposit in U.D. ($1=P40} $500
Cash prize won in a local contest 6,000
Casin prize won in a contest in U.S. 10,000
Winnings in lotto 20,000
Winnings in lotto in U.S. 50,000
Dividends from SMC, a domestic company 25,000

  1. The income tax due on Carlo assuming he is a non resident alien NETB single is
A

88,500

26
Q

Celina sold 1,000 shares of not listed and traded shares of stocks. The date of which are as follows:
Selling price P600,000
Fair market value 620,000
Expenses on sale 10,000
Purchase price 440,000
Expenses upon acquisition 3,000
The capital gain tax due is -

A

22,050

27
Q

TP Corporation had the following Journal entry of fringe benefits.
Fringe benefit expense P186,000
Fringe benefit expense 84,000
Cash 186,000
Fringe benefit tax payable 64,000

Based on the above accounting entry, the amount of fringe benefit given to the rank and file employees

A

67, 143

28
Q

Mrs Santos, married with 2 year old child

The taxpayer will report a taxable net income of `

A

520,400

29
Q

Ms Espiritu an offlcial of ABC Coporation asked tor an earlier retirement because she was migrating to Canada she was paid P2,000,000 separation pay in recognition of his valuable services to the corporation plus P300,000 13th month pay, Mr. Manabat another official was separated due to his failing eyesight.

A

2,510,000

30
Q

Mr Enriquez provided the following

The salaries are net of 50,000 withholding tax but gross of 10,000 SSS union dues & Pag ibig….

The taxable net income is

A

506,000

31
Q

Mr Enriquez provided the following

The salaries are net of 50,000 withholding tax but gross of 10,000 SSS union dues & Pag ibig….

The total final tax on passive income

A

47,000

32
Q

Malabs corporation assigned Ms Joan one of its employees in the head office in manila to manage their branch in dagupan city the company provided for the residential house of the manager paying monthly rental of 34,000

the monthly fringe benefit tax thereon is

A

9,154

33
Q

Malabs corporation assigned Ms Joan one of its employees in the head office in manila to manage their branch in dagupan city the company provided for the residential house of the manager paying monthly rental of 34,000

Based on the same data the deductible expense from the gross income of malabs is

A

43,154

34
Q

Lawrence is a resident citizen
Date of sale Date of acquisition …..

The capital gains tax on February 13, 2018 sale

A

4,125

35
Q

Lawrence is a resident citizen
Date of sale Date of acquisition …..

The capital gains tax on the April 5, 2018 is

A

15,600

36
Q

Lawrence is a resident citizen
Date of sale Date of acquisition …..

The capital gains tax refund on the July 20, 2018 sale is

A

none

37
Q

Lawrence is a resident citizen
Date of sale Date of acquisition …..

The final capital gains tax / refund at the end of the year is

A

tax refund of 18,000

TAXATION (4 decks)

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