Taxable or Not? Flashcards
Taxation Law 2018 IIa
Kronge Konsult, Inc. (KKI) is a Philippine corporation engaged in architectural design, engineering, and construction work. Its principal office is located in Makati City, but it has various infrastructure projects in the country and abroad. Thus, KKI employs both local and foreign workers. The company has adopted a policy that the employees’ salaries are paid in the currency of the country where they are assigned or detailed.
Below is an employee of KKI. Determine whether the compensation s/he received from KKI in 2017 is taxable under Philippine laws and whether s/he is required to file tax returns with the Bureau of Internal Revenue (BIR).
(a) Kris Konejero, a Filipino accountant in KKl’s Tax Department in the Makati office, and married to a Filipino engineer also working in KKI.
Taxable (Secs. 23 and 24(A), NIRC). Kris must file tax returns with the BIR, unless she qualifies for substituted filing of income tax returns because the tax was correctly withheld by the employer (Sec. 51(A)(2)(b), NIRC).
Taxation Law 2018 IIb
Kronge Konsult, Inc. (KKI) is a Philippine corporation engaged in architectural design, engineering, and construction work. Its principal office is located in Makati City, but it has various infrastructure projects in the country and abroad. Thus, KKI employs both local and foreign workers. The company has adopted a policy that the employees’ salaries are paid in the currency of the country where they are assigned or detailed.
Below is an employee of KKI. Determine whether the compensation s/he received from KKI in 2017 is taxable under Philippine laws and whether s/he is required to file tax returns with the Bureau of Internal Revenue (BIR).
(b) Klaus Kloner, a German national who heads KKl’s Design Department in its Makati office.
Taxable, being income earned by a resident alien from Philippine sources (Secs. 23 and 24(A), NIRC. Klaus is required to file a tax return, unless the compensation income from KKI is his only returnable income and the withholding tax thereon was correctly withheld by his employer (Sec. 51(A)(2)(b), NIRC).
Taxation Law 2018 IIc
Kronge Konsult, Inc. (KKI) is a Philippine corporation engaged in architectural design, engineering, and construction work. Its principal office is located in Makati City, but it has various infrastructure projects in the country and abroad. Thus, KKI employs both local and foreign workers. The company has adopted a policy that the employees’ salaries are paid in the currency of the country where they are assigned or detailed.
Below is an employee of KKI. Determine whether the compensation s/he received from KKI in 2017 is taxable under Philippine laws and whether s/he is required to file tax returns with the Bureau of Internal Revenue (BIR).
(c) Krisanto Konde, a Filipino engineer in KKl’s Design Department who was hired to work at the principal office last January 2017. In April 2017, he was assigned and detailed in the company’s project in Jakarta, Indonesia, which project is expected to be completed in April 2019.
His compensation from January 1 up to the the time he left the Philippines is taxable and he must file tax returns, unless the compensation income is his only returnable income and the withholding tax thereon was correctly withheld by KKI (Sec. 51(A)(2)(b), NIRC). The compensation for his services abroad from the date of his actual assignment thereat up to the time of the completion of the project is tax-exempt being income from without earned by a non-resident citizen (Secs. 23 and 42, NIRC). He is not required to file a return for this income derived from without, because said income is not subject to income tax in the Philippines (Sec. 23, NIRC).
Taxation Law 2018 IId
Kronge Konsult, Inc. (KKI) is a Philippine corporation engaged in architectural design, engineering, and construction work. Its principal office is located in Makati City, but it has various infrastructure projects in the country and abroad. Thus, KKI employs both local and foreign workers. The company has adopted a policy that the employees’ salaries are paid in the currency of the country where they are assigned or detailed.
Below is an employee of KKI. Determine whether the compensation s/he received from KKI in 2017 is taxable under Philippine laws and whether s/he is required to file tax returns with the Bureau of Internal Revenue (BIR).
(d) Kamilo Konde, Krisanto’s brother, also an engineer assigned to KKl’s project in Taipei, Taiwan. Since KKI provides for housing and other basic needs, Kamila requested that all his salaries, paid in Taiwanese dollars, be paid to his wife in Manila in its Philippine Peso equivalent.
Not taxable and no need to file tax returns. Kamilo is a non-resident citizen who is taxable only on income from within. Compensation for services rendered outside of the Philippines is income from without which is not subject to the Philippine income tax (Secs. 23 and 42, NIRC).
Taxation Law 2018 IIe
Kronge Konsult, Inc. (KKI) is a Philippine corporation engaged in architectural design, engineering, and construction work. Its principal office is located in Makati City, but it has various infrastructure projects in the country and abroad. Thus, KKI employs both local and foreign workers. The company has adopted a policy that the employees’ salaries are paid in the currency of the country where they are assigned or detailed.
Below is an employee of KKI. Determine whether the compensation s/he received from KKI in 2017 is taxable under Philippine laws and whether s/he is required to file tax returns with the Bureau of Internal Revenue (BIR).
(e) Karen Karenina, a Filipino architect in KKl’s Design Department who reported back to KKl’s Makati office in June 2017 after KKl’s project in Kuala Lumpur, Malaysia was completed.
Compensation from January 1 up to the time of her return in June 2017 is income from without which is not taxable if received by a non-resident citizen (Secs. 23 and 42, NIRC). Compensation from June 2017 to December 31, 2017 is income from within and taxable to Karen who is taxable on worldwide income from the time she regained the status of a resident citizen and, accordingly, must file returns to pay for the tax, unless she is purely compensation income earner for which the withholding tax on wages was correctly withheld by KKKI (Sec. 51(A)(2)(b), NIRC).
