ACTIVITY NO.

1
Name:
Section:

I. True or false

1. The accounting period of a starting business will more likely be less than 12 months.
2. Resident aliens are taxable within and without the Philippines.
3. Ordinary gains arise from sale, exchange, and other disposition of any assets.
4. Regular income tax generally covers active income and capital gains.
5. An item of gross income that is subject to tax in one scheme may also be taxed by the other scheme, if BIR
permits.
6. Capital gains tax are imposed on the ordinary gain on the sale, exchange and other disposition of assets.
7. Not all capital gains are subject to capital gains tax.
8. Ordinary assets are those directly used in the business, trade or profession of the taxpayer.
9. Personal expenses of the taxpayer can also be deductible to gross income.
10. Resident foreign corporation’s income outside the Philippines are still taxable under Philippine income
taxation.

II. Enumeration

1. What are the three major income taxation schemes under NIRC?
a. c.
b.

2. Give two examples of gross income subject to final tax.

a. b.

3. Give two examples of gross income subject to regular income tax.

a. b.

III. Computation

1. Ramon Villanueva, a non-resident citizen, is an international financier who earned P300,000 interest income
from resident debtors and P400,000 from foreign debtors.
a. How much is his taxable income? (1 point)
b. How much is his income tax due? (1 point)

2. Ms. Salazar had the following income and expenses in 2018:

Philippines Abroad
Rent Income P800,000 P145,000
Royalty income 25,000 -
Compensation income 60,000 30,000
Business income 900,000 600,000
Business expenses 38,000 200,000
Personal travel expenses 25,000 50,000

If Ms. Salazar is a resident citizen, compute for the following:

a. Gross income subject to regular income tax (1 point)

b. Taxable income (1 point)
c. Income tax due (1 point)
d. Income subject to final tax (1 point)

If Ms. Salazar is a non-resident citizen, compute for the following:

a. Gross income subject to regular income tax (1 point)

b. Taxable income (1 point)
c. Income tax due (1 point)
d. Income subject to final tax (1 point)