yéarioore coat 9 a nant cera ae mew a oan Sn laa ay a onc ors w19000 dv me a rcv acti” tay, a auntie ines OP ¢.P 17857. Sata 2 PO et P2000 ere pene cree ie 8 rte Sa Pe ene S40 ey Fae xe wp ato oS seca nea Be eorporaiOn sacar ‘costing P12.000,000 sag se gen t Re ata price of P12,000,000, mt wat the ae nome subject to Philippine tax? wo p00 srmantearing sins 8B ene Gos eas Nene san ‘pusiness Ms. Gos EBM BE business ws, es atmate aes your aie supers ‘You were asked You Gost's bases er rading businesses Wil rate (09 ar goods hs ring the Yea Ne En ae ane aso BSN aes trse ince oe Ta iar pear en PN a PO 2 P200,000 », P100000

ea re me 29 na emt amounting to not more than P2,000 Femetsed unused vacation eavecredlis days ee raed ee tee alte met tr ae nce] Seeman” Sl aicare needs anual medial/executve checkup, maternity assist {ndroutine consitatons not exceeding P10,000 per annum Aequlred: Determine the taxable amount of de-inimis benefits. 7. Laundry allowance no exceeding P300 per month 8 Employee achievement award, eg. for length of service or sia) sou: achievement which must bein the form of tangible property other than a fot _Eme_ or git cericates, with an annual monetary value not exceeding PIU yonzed unused VL PgA00 P60 Po received ty the employee under an established written plan which does] tess unused Sc 5400 05.400 asm fr Holy ay {tere pie option 100 Toga) * SOM commissions | tocpesaton come tae) Parry {Fees including director’ fees (director isan employee) | 7 Emoluments and honoraria ‘Thecompensiton con halle reported by Antony inh 2018 one er 8. Taxable reurementand separation pay 9. Value ofliving quarters or meals reamentof he subsequent sae the shres 10. Gains on exerlseo tock options (IR Ruling 119-2012) ii cployer corporation 11 Proft sharing and arable bonuses 1." Dames corporation andthe ofthe stds made ‘ier hots acho cad upton o «Toh he PSE he ah don OA, These constitute additional compensation, except when derived by a minimum we ofthe gross sling pris mt oe ‘Selling price (P180 x 10,000) P 100000 Mulipi by: stcktrmsaten tance 7 ga, Commisstons, emoluments and honorata my Commissions are incentives intended to stimulate sales. These may be given 8 apr ‘Sock tremeectiontox ana Sharing or performance bonus. Emolumerts pertain to any pay in general / shed y te iar ta oneal te cic gil honoraria are additonal payments for tending spec sksor eign ‘Tote wb whi yh rae te ie i Alvcetly to buyer, the ne gai on th sale set he 159 pa ie Living quarters or meals fan employee receives free living quarters oF meas In adion to salary for servis, rendered the valu 1 he empleo uch Ing rary or meas nde tinct tx stl compared flaws: ‘compensation income, However, when the same was furnished to an employee 1900000 convenlence ofthe employer or out of necesty ofthe employers business, the Seting pce (80x 10800 thereofis not compensation income, but a business expense. Less Tax basis of shares sl ae Capital gains Mlipy by: CO ta rate com Capital gains tax ne 328 z“chapter 10 Compensation Income pose 10~ COEENEON cay, ver benefits| 2 Forig corporation the et gin othe les cp gn sta, ‘pur iocine ec The pan subject to regular stall be ens P 18002000 —bsmnong F"on.00 — 2 5m00 Soting pie (180 12000) ideas ottaresnd Saini py ling period rat (1 ye) pea ba sent oat ‘The rls on destin of other cal sets wl be discussed iy following chapter. dea, Profit sharing or tazable bons Prot sharing 3 reward for churning the business to post conpensatin fr convolig she actos that nflucree seh and sales, productivity, and administrative factors Ie ig rewseg oe joyed by individual employees such 3 salermen, division al Productivity incentive bonus ‘The Productivity incentive Act of 1990 (RA 6971) encourages private emo tosatup product ince programs A prodaciviy Incentive liked to improvements in productive wy terms of com savings though waste reduction, ese labor las Increase vlume of producto Under the NING productiyicenve bee onside spat of "other benefit ner “13% month pay and ote Dede Under the reson of #h 10653, productivity Incentive snow a de mina benefie. Productivity incentive distinguished from proft sharing bonus Productivity neetive is anchored on improvements in the factors of producti and is usually enjoyed collectively by employees de to the inherent difcly tracing productnty to individual performance. It is based upon cost hence, is payable even ifthe business poves alos. Profit sharing is payable of} when the business posts prof. 115TH MONTH PAY AND OTHER BENEFITS “13th Month Pay and Other Benefits” includes: 1. 13th month pay 330 —_a everest yc Camo ge : {ate ret ey ep ene ‘sdaitional compensation ate, ‘ae tn Co pera rca (os menth 5° mee pon 2 oherntngeent a seamen te dah pay of gran 2 Svan one ny ee MOS! a nes waa ITY Bhs 25000 cach gt (R4S586 eed! Perth mow payee ep mea re on meth i, gros bons nd Chsmas git ‘ar eSnueas ons faerie ene 18h met py apt eas ihe erm vanes en? sees nh. age incentive pay, ortoa proftsharing ah cena Crsimas bnas of priate copes wich + nen tera Se ar ar a car Boge tas tal fee tere eStats ene reste Comes pe soe seen 1: of gaveenment employees especialy designated prt of ay und other benefit under Set 32(8)0)e)0 ofthe NRE RS {nT lute Unnctmas pn the BS of de ims bees Bat since reve sont amend the lo” hey tplement, RISIOLL shod be ‘chats ge of private employees. a ven ly Government 7 emis Cirsimestamas— | Vet pay | Toh sont |b bce Chetumes ‘sieierps | Desi . and other benefits | _. Se nd antn marine epee oR mpie Hinge DeNENES noe Mpplementary or 13h 0c aa ct ue 1 ie ea i ata eo yb onoyer te . ee perso fits Fe en ge ene sx but ot limited £0, rental of al m tre or vaca ert eg i to, ne sor ec OT gente onsite ee employe citi id ely at epee eed je ¥ Ele cca theenole ster ay yale which are not inchided inh, Teele de ee a ve ge minimis But as orca snot be considered nis but 35 ordinay shal 0B cn nimis benefit OUI be cng amp orinary rings bene a Fartrment fOr PHAETBEOE | sensation lnc ay read yond ee * herb ployee ete 5 rng bene Far manageil rs genet a eg athe ‘thr ine benefits” of managerial os ceoesa sation ployee in addition ths he empoyerpys forthe tution fee of the em congestion. asfollows, ston pais fge Benet which wil be treated alow isacanpensten cme spr of"therBenefis” under "19® string te enpoyeesarankand leemployee |, 2. Asafnge beet sujet inge bene tax ifthe employee “sperisaryemplyee oe 3 Asan cent ng bet reales ofthe type of employee f° Sebel forks convenience or business neces) SAS olyee is requred to study to acquire expertise for the eplyersbsines nh 332 ice ev 8 MOMMY rc sowan fF 80 am Sees actress ron coh monthly eXCeSS consi may conve es Sao ass Serre tat emg ee os Steet a neo" OHNO anna ing, on compensation provided’ on roo a ra a, rn fom che 700 segs a a ‘compen i“ f can ver elts ora a treatod ss compensation income subject to repularancone ge SHOU be ational compen atton allowance 36,000 a a Pay and other benefits: P 112,000 Taable 13th month Pay and other benefits 222009 fo gover Meters ope ee nF Rl Nava mt sea w toe a beng (Under _— 1 Qari os sey bn) 3 sea af gore empty dey te NRC bp ona andether bec be oatCha ipter 10 - Compensation Income Rules of ch; ange i 1 ge in status as a Minimum Wage Earner durin N When an empl Bayer be dubject d is ee becomes a minimum wage earner during ae ee shal ie ome tax ‘ d before min, minimum wage earner. only on compensation earnet Ba Mustration 1 Anthony had a ba ; age was P382/da sic pay of P400/day when the minimum wae Y. He is also receiving overtime pay et the vear-en 3th month Pay- on )uy. 42019, the Regional Wages and Productivity Board increey fe minimum wage by P22/day to P404/day. Anthony's employer ‘mereased hil P404/day. Anthony shall be taxed on his income from. january 1 to) sthholdt hholdi @ minimum wage earner. The employer Shall regular ei ine 30. Athy on compensation from his salary but shall SCOP wining oy a Nan "ys compensation starting July 1 including overtime pay © ” shall be tax exempt. is salary to the minimun une 30 because he isnot yet es had been withheld by the employer for the If the exact amount oJ income taxé i Ife eat art peston MT rfl fl a anf ‘Otherwise, Anthony shall file an adjustment retur 76 ectind for refund in case zB January 1 to June 30 and shall pay the till due or of ‘excess withholding. ‘This rule may also apply in case of: ps pransfer to an employer Payline salary at th b. Transfer of employment to 2 region with hi uum wage ear" ceases to be a minim’ only the income for the rest of the the minimum wage igher minimum wage When an employee ner during the year due to increase in salary, year is taxable Mlustration 2 ; Andrea is a minimum wage earner. She was promoted and was given a salary vaise above the minimum wage starting August 1, 2019. “Andrea shall be exempt from income tax from January 1 ‘ninimum wage earner. Effective ‘August 1, 2019, Andrea sI employer shall start deducting the withholding tax on compens' salaries effective the same date. If the employer properly withheld the income tax for the period August 10 December 31, Andrea need not file an income tax return. Otherwise, she shall filet adjustment return reflecting her compensation for the same period and shall pay the tax still due or claim for refund in case of excess withholding. to July 31 because she isa hall be subject to tax. The ‘ation from Andrea’ This rule applies in cases of: a. Transfer to an employer paying sal b. Transfer of employment to a region witl lary above the minimum wage h lower statutory minimum wage 342 PT {hae A wcnapter 10- Compensation Ing when an employee g, 3 disqualification (i.e, eat mite m : & i vy, the! No inc is ce OMe tax due for Plover does not * the period under inimum w; come) "8° #™er during the year by ry. exceed P25, the tex aa for the tment of Cost-of-livin, 8 Allo jnder RMO23-2011, COLA wrice Wace of M the statutory minimum wage srs ee ott oe pal not be treated as.q ets at be ated New wage rates Prescribed a as pa ribed to F other b rt of the mini wag THE DEE G TAX ON COMPENS, a a the withholding tax on compensati TION . : sation j, | source upon receipt of the inco ra ethod me. It applies of collecting the tdallons 8 the income tax at x + ¢tizens or aliens. The employer i: | yer is consti lo a i stituted as 'Ployed individuals wheth the withholding ay oe gent. | roduced herein i: i i | ia is the withholding tax table for semi-monthl “monthly compensation: e ul REVISED 1) foauy 1 5 WITHHOLDING TAX TABLE 3 ! Konpensation Range|| P 685and |! Peas-p ll pao5 a sls ‘ below 1,095 096- fp 2192-P || sare f z P2,191 5478 5479-P [| Pa4si8and rescribed 0.00 Pazia |p atl a lithholding Tax 0:00 +20% over || + 25% over || ssc ep || shtee2a7, | P6074 P685, 1,096 pale P || +32%overP |] + 35% over ween 1 A ; : 5479 24918 4 #1 Lompensath P 4,808 5 6 mmpensation Rangel| ° 4:808and || P4,808-P || P7,692-P || P15.385-P || Pae.a62 ; 3462-P || P13, —_ 781 15,384 38,461, 153,845 hn Prscived 0.00 P57692 || 25000 || p9423.08 500. 08 || Pacades 1 [iting Tax 0.00 |] + 20% overP || + 25% over P|| + 30% overP || +32%over || +35%overP faa 4,808 7,692 15,385 38,462 153,846 MONTHLY 1 2 3 4 5 6 1 pensation Range||® 10.417 and |] 10,417 -P P16,667-P || P33,333- || P 383,333-P || P 333,333 and h below 16,666 33,332 83,332 333,332 above f bed 0.00 1,250 P5416.67 || 62041667 || P 10041667 iding Tax 0.00 420% over |} + 25% over P |} + 30% over P raha? ment s 10,417 16,667 33,333 é , 5 # 1 2 3 es =} Pp |p 106667-P || ° 686667 # P 20,883 andl| P 20,833-P || P33333-P || P sae 666,666, above below 33,332 66,666 9 g33.38 || 770088338 mI 2500.00 710,833.33 |e eiyer? Pawover? a 100 | casmover? |] 20m omerP | ec cer IL Sse J .00 |] + 20% over eee eo? _|L_368862_J 20,833, ;bo Le Chapter 10 - Compensation Income ¥, 4 ‘Procedural Computation of the withholding tax on compensation ibn of the V; p, ‘ 1, Determine the total monetary ‘arid’ non-monetary comPeDet oy day, /y/ employee. forthe payroll period:, monthly, semi-monthly, we lementay "ys! Segregate non-taxable| benefits, mandatory contributions ho compensation. nsation of the Hg 2, Determine the bracket that applies to the regular COMPLI vax for the 7 employee for. the. applicable payroll period. Determine bracket. f the regular compensation, tp 3. Add supplemental compensation to the excess 0! To. 4 Subject the total to the incremental tax rate for the és tal basic tax- ¥ 4. Total the basic tax and the increment! Mlustration 1: Weekly payroll period dro has a weekly salary of P10,060, 7 ABC Company pays Employee Zandro weekly. Zandro Ta" DMF and Union dues ang ge before P500 mandatory contributions for SS, PhilHealth, P1,000 non-taxable benefits. a ‘Zandro’s taxable compensation shall be computed as: p 10,000 Grosscompensation = - on # Less: Mandatory contributions a ! Non-taxable benefits Taxable income P__8.500 fe income qualifies under Column 3 under the wey ’s P8500 weekly taxabl “ us se a hhall compute the withholding tax on compensation a ABC Company s! follows: Tax Regular compensation income P s:-8,500 a Less: Base amount at Column No. 3 - weekly 7692 Poe Excess e oD Multiply by: Incremental tax rate ——25% ___202.00 & Total withholding tax on compensation P7782 & a ‘The amount of compensation income that will be released to Zandro shall be: a Gross compensation P 10,000.00 . Less: Mandatory contributions Pp 500 ; ‘ Non-taxable benefits 1.000 1500.00 Taxable income P 8500.00 4 Less: Withholding tax on compensati a8, u pensation 778.92 Net payroll due to Zandro P_Z721.08napte 40 - Compensation Income a tion 2 stra we Company employs Mr. Penoy with \ 4a Chr emonthly every 15" and 39 a basic mo: pally, Penoy earned total overtime a mines HDMF and union dues were ay oF ently salary of P70,000 which is pay OF Pre quonth. For the second half of the - Pa 100, 17000 Total contributions for Sss, ,< semi-monthly regula s a dora he sen emPensation is P35,000 (ie. P70, 00/2). Th - P70, |. This qualifies pen | ABC Company shall compute el " si poling f2x On COmPensation as follow St egular compensation income lease amount at Column No, 4~ semi-monthly 35,000. cess ——33.333 P 5,416. a: ‘supplemental compensation P 1,667 ay tal ——12,000 uiltiply by? Incremental tax rate P 13,667 otal withholding tax on compensation ——30% __ 4100.10 P9,516.77 eamount of compensation income that will be released to Penoy shall be fe: nsati ular compensation P 35,000.00 jplemental compensation _12.000.00 tal compensation P 47,000.00 i) : Mandatory compensation P 0.00 ? Non-taxable benefits _—4.100,00 4,100,00 | ible income P 42,900.00 {, ; Withholding tax on compensation 9,516.77 233,383.23 payroll due to Penoy re also applicable for daily or monthly payroll procedures discussed herein a spective withholding tax table. jods but of course using their res} end Tax Adjustment | amount withheld on every payroll dae may nt 'y match . Due to this, the income of the employee nee He aneeal ustment is made as necessary. ANY the final payroll of the employee. ‘An over: holding shall be refunded to the employe? TION UNDER ment d entirely in products of the 345oe ‘kers or “kasambahay” ; reser Workers Act or Batas Kasam € for commercial pare month - too low compared to the tax ae trial, or agricultural workers, the course of an employer's 'e Domestic trade M by a citizen or resident of the Phili ‘oreis ; Hpi 8M Government or an international organization PPINE Under RMC 31-20 13, this is not ion i ji i it is stin taxable 'S Not compensation income subject to withh ‘old te aie : 1 ng, employee. mpensation income; hence, it must be Teported by 6. Damages Paid by the employer to employees 7. Proceeds of life insurance 8. Amounts received by an insured employee as a return of premium 9. Compensation for injuries or sickness 10. Income exempt under treaty 11. 13th month pay and other benefits not exceeding a total of P90,000 12. GSIS, SSS, PhilHealth, and other contributions 13. Compensation income including overtime pay, holiday pay, night g differential pay, and hazard pay of Minimum Wage Earners 14, Compensation income of employees in the Public sector if the same does exceed those of minimum wage earners in the non-agricultural sector These listed benefits are not considered compensation income; hence, they exempt from the withholding tax on compensation, DEADLINE OF FILING AND REMITTANCE OF THE WITHHOLDING TAX ON COMPENSATION Employers shall file the BIR Form 1601-C (Monthly Remittance Return of Inc Taxes Withheld on Compensation) on or before the 10t day of the following m¢ the withholding was made except for taxes withheld for December which s I filed/paid on or before January 15 of the succeeding year. Employers are also required to file BIR Form 1604-CF (Annual Information R of Income Taxes Withheld on Compensation and Final Withholding Taxes) before January 31 of the following calendar year in which the compen income payments and passive income payments were made. Employers shall furnish each employee-taxpayer a copy of BIR Form (Certificate of Compensation Payment or Income Tax Withheld) on oF January 31 of the succeeding year. 34640 - Compensation Income ores for Non-compliance i re subject to the sa, rare of withholding tax req li ca me penalties discussed in Chapter 4 for non- luirements, {the Withholding Tax reatme” aaa has other items of j tne eee from business or p; as on Compensation income that are Subject to regular income tax rofession, income from other employment or sit? jincome, he must file a consolidated income tax return to include such nen casual aes the entire taxable year, The withholding tax on compensatio 4 in gainst the total tax due in the consolidated income tax return. dite pstituted filing of tax return i i tax return of the ituted filing system, the employer files the income der the ee! es of tax is correctly withheld by the employer, the yee. longer needs to file an annual income tax return, ployeepo Chapter 10 - Compensation Income of ‘ CHAPTER 10: SELF-TEST EXERCISES | at bs Discussion Questions | uy 2 Rossi and explain the elements of an employer-employee relationship, \ i g ._ What are the types of employees as to function? Enumerate and explain, 1% 3. Whatare the types of employees as to ‘lity? Distinguish each. . ; 4 Who are minimum wage earners? Eman nero cnet benefit A pe aa earners? Enumerate theit exempt benefits. ba 6 Whatare the clasin no lel on compensation income. bw oa of compensation income? Discuss each. 7 a Rumer the geural classes ofnon-taxable benefits. qt weonaee els of de nile benefits and their respective bane e male’ ity of the employer” rule and the “conven! € Employes u 10. Distinguish regular compensation from supplemental compensation. Enumera, fo the benefits considered as supplemental compensation. ot 11. How are stock options taxed under current tax rules? } # 12. Enumerate and explain the components of “13 month pay and other benefits" 44. A 13. Discuss the difference in tax treatment of the “other fringe benefits” of rank ayq | {2 th file employees and managerial or supervisory employees. of 14, Discuss the tax treatment of “13th month pay and other benefit.” gt to True or False 1 Re 1. Aspecial employee may include Filipino citizens. or 2. Arank and file employee recommends managerial actions. is. 3. Aconsultant is not an employee. on 4. Amanager has the power to lay down and executes policies. ial 5. Aregular employee is subject to the regular income tax. ini 6. Filipinos employed by international missions are generally exempt. Fe 7. Filipinos working in Philippine embassies are exempt from taxation. FD 8. Aminimum wage earner is exempt from income tax. info 9. Compensation income includes regular compensation, —supplemena} inc compensation and 13th month pay and other benefits in excess of P90,000. | » Th 10. Compensation income includes all remunerations received under an employs | ¢o employee relationship, including all fringe benefits of managerial or supervise | th employees. ay 11. Benefits for the advantage of the employee are exempt from income tax. An 12. Remunerations received as incidents of employment are exempt. 7 13. The employee's share in SSS, GSIS, PhilHealth and HDMF are excluded ft} » compensation income. fe 14. The exempt vacation leave credit is 10 days for government employees. ry 15. Tax exempt de minimis benefits include all benefits of relatively small value. h 16. The excess de minimis are considered “other income” for any employee. 8 yj 17. The sick leave credit of private employees up to 10 days is exempt de minimis 18. The overtime pay of minimum wage earners is exempt from tax. 348Compensation Income , 110 | one false 2 6 ental compensati | supe lemme every Payroll pei Sag, *re fixed amounts SL See oe ce can period, regularly received by the ‘ ir compensation iat Supervisory, or rank and fil Rett ed by the employee with Ses tarlable performance-based tate al sirectors are not considered employes it regard to the payroll period. ete eign file employees do routinary or Gare ‘ wage eal ith bua al jl inimum wage earner with business income is consi Afject to income x is considered a regular employee rial employee is least likely to be a minimum wage earner. mae 14 manag ia Ae statutory minimum wage is P60,000 ann lt gesonal finan Wage and Productivity Beard weioed Gees fixed by the | 4, an 0B! ‘ jocal bank authorized to conduct banking te: «| fein currencies luct banking transactions in the position and function test, compet 10 The Poured for alien employees, pensation threshold test, and exclusivity test A managerial employes can be a special employee. | jp The Christmas gift 0! private employees forms part of “ I ha ofgovernment employe is considered de minimis ae Tenofce rte fat 13 The fringe benefits of managerial or superviso ‘ pies ry employees are generally subject 14, Resident Filipinos employed by foreign embassies, mission: ii i organizations are generally taxable. sor imbermaticnsl 15, Non-resident Filipinos employed by foreign embassies, missions, or international organizations are generally exempt. 16 Filipinos employed in Philippine embassies al 17. Half of the benefits given for the convenien taxable. 18 Fixed allowances are supplemental compensation income. 19, For managerial employees, the excess of de minimis benefit included as “other benefits”. 2 The excess of the 13th month pay and other benefits compensation income. re generally exempt. ce or necessity of the employer are its over their limits are over P90,000 is considered loyees who have multiple or m applies to empl 4 The substituted filing syste Successive employments. A is “An employer coerols the means and methods by which the work is to be accomplished. is Qt An employee who became a minimum wage earner during the year is exemP Uy, for the entire year. i i ar shall — wage aia are disqualified for exemption during the yee ye *2ble as regul Joyees ynold by a salary . Mini gular employees. «imum wage threshot y ira Wage earners WhO breached ng ro the months of increase. Mere, "ast i ¢ during the year are taxal 349Cc hapter 10 - Compensation Income 4 {s usually in th e natu rformance-based ic of an incentive, Compensation Income i \ iy ene Drill No, 1 In the blank provide item on 'd for, indicate whether the specified benefit or remuneration j Is RC- regular compensation ~ FB ~ fringe benefits : SC-su i, aearemental compensation + OB ~- 13" month pay & other benefits ts + EB - exempt or non-taxable benefits —— Benefit or re mane ae Supervisor 1. | Uniform allowance eon 2._| Commissions 3._| Rice allowance 4. _| Productivity incentive : Christmas bonus ~ government 7. 8. 26. A fringe benefit the nature of pe Fixed monthly RATA - government Medical benefits ‘Additional compensation allowance - government 9._| 13th month pay 10. | Christmas gift - private 11. | Anniversary gift 12.| Shuttle allowance to a distant facility 13. | Excess de minimis benefits 14.| Basic salary 15. | Profit sharing [ 16, | Other employee personal expenses paid by employer 17.| Emoluments and honoraria 18. | Stock bonus 19. | Educational assistance to employee under employment bond 20. | Used sick leave credit 21.| Monetized unused sick leave - private 22.| Monetized unused vacation leave - rivate 23.| Monetized unused sick leave - overnment 24. | Monetized unused vacation leave - | government 25.| Excess over P90,000 of 13th month | pay and other benefits 350r 10 - Compensation Inco, om" cise Drill No. 2 me ge" jing that the employee j ming that S a pri asstregion with a minimuns Wage of ™Ployee wien tat in pute the annual excess qe mii 251 col 0 ic Salary of P300 iis bene nga leate the annual limit a2 : gq De minimis benefits SPACES provided for. p100/meal for 15g Overtime Limit | quring the year days cess | =] 6,000 monetized vah lue of 15. vacation leave credits day | ———+_| P1,000 monthly medical allow, _{ dependents of employees "eeto [| | 6,000 monetized value of 15-day " | sick leave credits 12,000 medical benefits P| | P2,000 quarterly uniform allowanes [| -_- P500 monthly laund: allowance [ed | [P10,000 achievement award in cash pe | |] P3,000 Anniversary gift and P5,000 Christmas gift | P3,000 monthly rice allowance wrercise Drill No. 3 450-year-old employee retired during th and received the following remunerations: fe year after 30 years of continuous service wesley Fandunion dues 24000 Employee a to SSS, PHIC, HDMF and wi nae Overtime pay 2,300,000 Retirement pay 400,000 Benefits from SSS 21,000 forated 13th month pay Required: ae J Gmpute the gross taxable compensation income. —__ terse Drill No. 4 gr to cae "employee received the following ben Pp 60,000 amon - 12,000 . ft sharing 0,000 ‘inimis benefits: aria 30,000 minimis benefits within their limit 10,000 ass de minimis benefits ley erg (© Minimis benefits em Ig ‘inge benefits Centives 351258,000 a 20,000 65,000 21,000 nsation income in 2019: 780,000 t 43,000 65,000 13th nel 22,000 mis bene emp 32,000 pe tical ase wonton pal of other 4° jon inco™e ifthe employee is 2 rank and file, | al compute the taxable compens”' 923,000 | 2 rey 4. P780,000 > ae tion income if the employee is a manager; 10, Compute the taxable compensa rvisory employee 842,000 cP 82300) : b, 836,000 4.P 780, Multiple Choice - Problems: Part 2 1. Anemployee received the following remunerations aside from the basic pay: I 6 Fixed representation and transportation allowance P 24,000 Night shift differential pay +7000 Hazard pay A ; Honoraria 12,000 Profit sharing 8,000 13th month pay 24,000 , Compute the suj 18,000 8 ipplemental co} . a P 68,000 mpensation if the empl: A egular empl b. P 44,000 a 56,000 ployee is ar" 0g . P 3; 2. Compute the suppl 2,000 ee: pplemental compensation j , bp oao00 on if the employee is a ™it™ . P44,000 P6000 4.P 32,000 358 __—er 107 Compensation Income ap : ; on compute a taxable compensation income in 2019. p52) P5 © P 75,000 bP 72,60 4.P 127,600 mployee bec: ular employe ame a minimum wage earner when the minimum wage yh increased effective the last quarter of 2019: Al uae —AstOtr_ _2ndotr —4th Otr_ compensation income — P_ 24,000 > 24000 P24,000 P 24,750 overtime pay 4,000 5,000 3,000 6,000 y3th month pay - 8,063 Less, PHIC, HDMF 585, PHIC, 1,000 1,000 1,000 1,100 creditable WH tax = __1100___14100 __1400___1.200 Net pay B25.200 P_26.900 P 24900 P 36.513 compute the taxable compensation income in 2019. c.P 81,000 a PO b P29,650 d.P 110,650