Multiple Choice 1. Systems of Income Tax A.

Global One where the taxpayer is required to lump all of the items of income earned during a taxable period and pay under a single set of tax rules on different items of income. B. Progressive Tax System Income tax in the Philippines is a progressive tax, as people with higher incomes pay more than people with lower incomes.

2. Feature of Schedular System A tax system used which income levels are divided into different classifications for determining tax rates. Each income classification represents a different source of income such as business profits, capital gains, employment income, entitlements, that is taxed according to the specific provision of the Tax Act to which it applies.

3. Taxable Income The pertinent items of gross income specified in the tax code of the philippines, less the deductions and/or personal and additional exemptions, if any, authorized for such types of income by the tax code or other special laws.

4. Compensation for Injuries or Sickness amounts received, through Accident or Health Insurance or under Workmen's Compensation Acts, as compensation for personal injuries or sickness, plus the amounts of any damages received, whether by suit or agreement, on account of such injuries or sickness.

5. Narecieve ng namatayan How treated

6. Gifts given in the occassion of wecking Is it deductible?

7. Capital Vs. Ordinary Asset Holding period (1) Capital Assets. - The term "capital assets" means property held by the taxpayer

(whether or not connected with his trade or business), but does not include stock in trade of the taxpayer or other property of a kind which would properly be included in the inventory of the taxpayer if on hand at the close of the taxable year, or property held by the taxpayer primarily for sale to customers in the ordinary course of his trade or business, or property used in the trade or business, of a character which is subject to the allowance for depreciation provided in Subsection (F) of Section 34; or real property used in trade or business of the taxpayer. Ordinary assets. a. Stock in trade of taxpayer b. Property which would properly be included in the inventory of the taxpayer on hand c. Merchandise inventory d. Depreciable assets used in the trade or business e. Real property used in trade and business 8. Losses from rel transaction from rel pwhl

9. Merger and Consolidation Section 40 - No gain or loss shall be recognized if in pursuance of a plan of merger or consolidation (a) A corporation, which is a party to a merger or consolidation, exchanges property solely for stock in a corporation, which is a party to the merger or consolidation; or (b) A shareholder exchanges stock in a corporation, which is a party to the merger or consolidation, solely for the stock of another corporation also a party to the merger or consolidation; or (c) A security holder of a corporation, which is a party to the merger or consolidation, exchanges his securities in such corporation, solely for stock or securities in such corporation, a party to the merger or consolidation.

No gain or loss shall also be recognized if property is transferred to a corporation by a person in exchange for stock or unit of participation in such a corporation of which as a result of such exchange said person, alone or together with others, not exceeding four (4) persons, gains control of said corporation: Provided, That stocks issued for services shall not be considered as issued in return for property.

10.What is taxable income in the disposition of real estate

11.Personal and Additional personal exemptions

12.Who are entitled to income Vis-a-vis other types of taxpayer resident foreign corporation

13.Proceeds of life insurance and premiums

14.Treatment of bonuses - Wedding

15.What are deductible expenses allowable deductions section 34 Essay 1. Stages and aspects of taxation a. Levy Refers to the act of the legislative in determining what are subject to tax, the amount of tax, those who are liable to pay the tax and other aspects of taxation. b. Assessment Refers to the enforcement of the law that is enacted by the legislature which includes the collection of the said taxes imposed by law. c. Payment Refers to the manner of payment to which the taxpayer is made to comply with their tax obligations imposed by law.

2. Principles of taxation (example, ordinance that requires payment of annual tax, double taxation)

An ordinance passed that requires the payment of an annual fee is not done in the exercise of the power of taxation. It is passed for regulatory purposes and not for revenue purposes, It is made in the exercise of police power.

There is double taxation occurs when the same person or property is taxed by the same authority, under the same jurisdiction, and under the same purpose.

3. Nature of income Church having a business is taxable A non-resident alien is liable to pay taxes for income derived or realized in the philippines.

4.

Exclusions in gross Income

5. 3 types of deduction on gross income

6. Validity of ordinance Effectivity of the code Presidential decree 1158 June 3, 1997 Republic act 8424 January 1, 1998 Republic act 9504 July 1, 2008

7. Different kinds of income tax under NIRC a. Personal income tax b. Regular corporate income tax c. Minimum corporate income tax d. Capital Gains tax e. Passive investment income tax f. fringe benefit tax g. improperly accumulated income tax h. Final witholding tax

8. 180 day rule in relation to a foreigner to be considered doing business or not doing business. GENERALLY, a non-resident alien engaged in trade or business within the Philippines shall be subject to an withholding income tax rate of 20 percent on the total amount received thereof consistent with Section 25(A)(1) of the Tax Code. A nonresident alien individual who shall come to the Philippines and stay for an aggregate period of more than 180 days during any calendar year shall be deemed a nonresident alien doing business in the Philippines. Furthermore, Section 28 (B) (1) states that foreign corporations not engaged in trade or business in the Philippines shall be subject to 30 percent withholding income tax only when the income is derived from sources within the Philippines.