203. The location of property is important in determining whether the property shall be included or notin the _oss estate of a decedent who was a Resident citizen b. Non-resident citizen _¢, Resident alien d, Non-resident alien 204. The gross estate includes properties located in USA of a non-resident citizen ‘The gross income includes income earned in USA ofa Filipino citizen a True tue b, True false False, rue d. False, false 205. This maybe subject to donor’s tax. Donation to 2 The Ramon Magsaysay Award Foundation, The International Rice Research Insitute >. The Development Academy ofthe Phils d, Social welfare, cultural and charitable institution 206. One of the following is not correct as regards property subject to vanishing deduction, Ifthe decedent wes 8. A resident of the Phils. the property should be located in the Phils. b. Not a resident ofthe Phils. the property should be located inthe Phil © Aresident alien, the property should be located inthe Phils, 4. A resident citizen, the property maybe located anywhere 207, Amount receivable by the beneficiary other than estate, executor or administrator as an insurance under Policy taken by the decedent upon his ov life is 4. Part of gross estate whether the beneficiary is revocable or imevocable », Part of gross estat ifthe beneficiary is irrevocable ©. Par of gross estate ifthe beneficiary is revocable 4. Excluded from gross estate 208, Estate tax is a. Anexcise tax 6, An income tax ©. Apercentagetax 4. A.sales tax 209. _ A Expenses on the death anniversary ofthe deceased are not deduciibie expenses from the gross estate B — Attorney's fees incurred by an heir from appearance atthe trial to oppose the probate ofthe will ofthe decedent is deductible expense from the gross este aTrue,tue — b. Truc, false ©. False, false d. False, tue 210, Proceeds of life insurance to the extent of the amount reveivable by the estate of the deveased, his executor or administrator under policies taken out by the decedent upon his own life shall be 1. Part ofthe gross estate irrespective nf whether or not the insured retained the power of revocation TL Not part ofthe gross estate ifthe beneficiary is irrevocable, UL Part of the gross income if the designation ofthe beneficiary is revocable IV. Not part of the gross income irrespective of whether oF not the insured retained the power of revocation a Tand IL . Tand MIT © Land IV 4. only 211. Shares, obligations or bonds issued by 2 foreign corporation shall be considered as intangible personal property situated in the Phils if, how many percent of its business is located in the Phils? a 33% b. 50% © 75% d. 85% 212 14 Statement - Any contribution in cash or in kind to any candidate, political party or coalition of parties for _campaign purposes shall be governed by the election code and not the tax code 2 Statement - When the donee or beneficiary isa stranger, the tix payable by the Conor shall be thirty percent (30%) of the gross gifs a Tre,False —b. Tre, true False, re 4. False, false 213, A died leaving the property acquired by donation from B who died 3 '4 years ago. Property is now part of ‘A's gross estate, The estate's vanishing deduction rate is, a 60% b. 40% 6. 20% do 214, Which of the following is subject to VAT? ‘a.Importation of personal or household effects belonging to the residents of the Philippines returning from abroad and non-resident citizen coning to resetti in the Prilippines where such goods were ‘subjected to customs duties PWTAXO11 25bilmportation of passenger or cargo vessel and aitcrafs, including engine, equipment and spare parts thereof for domestic or interational transport operation ‘cmportation of fuel, goods and supplies by persons engaged in international shipping or air transport ‘operations 4 Sale of real property not primarily held forsale to customers or held for lease inthe ordinary course | ‘of business 215, Which ofthe following is exempt from VAT? ‘Sale of passenger or cargo vessels and aircraft including engine, equipment and spare parts thereof for domestic or international transport operations b. Sale of professional instruments and implements wearing apparel, domestic animals and peisonal household effect ©. Sale of fuel, goods and supplies by persons engaged in international shipping or air transport | operations 4d. Importation by persons who are not vat registered. | 216, Ifthe required documentary stamp is not affixed on a document, one of the following is correct. The document : a. Will be notarized because the document is still valid . Will not be admitted as evidence in court because the document is void © Will not be registered in the proper registry even ifthe document is valid 4. Is stil valid and ifalready notarized shouldbe registered and admited as evidence in court 217. The export sale ofa vat registered enterprise is a. Exempt from the vat 6, Subject to the 12% vat 1b. Subject to the 0% vat d. Subject to percentage tax 218, Which ofthe following statements is wrong on claim for input tax on depreciable capital goods? ‘a. Where the aggregate acquisition cost (exclusive of vat) of depreciable capital goods during any calendar ‘month does not exceed P1,000,000, the total input tax is creditable against ovtput tax in the month acquired b. Where the aggregate acquisition cost exclusive of vat)of depreciable capital goods during any calendar month exceeds P1,000,000, the input tax shall be spread evenly over 60 months starting in the calendar ‘month acquired ‘e. Ifthe depreciable capital goods is sold or transfered prior to the exhaustion of the amortizable input tax thereon, the entire unamortized input tax on the capital good sold or transferred can be claimed as input tax credit in the month when the sale or transfer was made 4. Where the aggregate acquisition cost (exclusive of vat) of depreciable capital goods during any calendar month exceeds P1,000,000, the input tax shall be spread evenly over the actual number of months of estimated useful life, stating in the calendar month acquired, if the estimated useful life of the depreciable eapital goods is less than 5 years 219, Effect of failure to affix a documentary stamp which is required by law, except ‘4 Shall not be recorded in the proper regisity b. Shall not be admitted as evidence in any court © Shall not be valid 4d, No notary public or other officer authorized to administer oaths shall add his jurat or acknowledgement 220, of the following is not an internal revenue tax? a. Value Addedtax —b, Realestatetax c.Emwcetex d. Documentary stamp tax 21. This is not an example of excise tax Transfer tax b, Sales tax Income tax 4. Real property tax 222. This shall be considered a livelihood activity only and shall not be considered doing business, ifthe gross sales or receipts in one year does not exceed ‘a P100,000 —b. P $50,000 ©. P-200,000 4. P60,000 PW-TAXO-IL 26223. 224, 228. 226, 227 228, 230, 231 232. 233. Value Added Taxis imposed on sale of goods or services while Percentage taxis imposed onsale of, services only. Donation mortis causa and inter-vivos are both acts of liberality by the person disposing of gratuitously a ‘Property ora right in favor of another who accepts it a True true. True, false «. False, true 4. False, false ‘The VAT on goods 4. Isa selling expense of the trader _¢.Is imposed on goods for domestic consumption .Ismnot based on net sale 4. Maybe due even if there is no actual sale of the goods ‘Value added tax is an example of & Graduated tax, Progressive tax. Proportional ax, Regressive tax ‘The following taxes maybe deducted from gross income, except ‘2 Business tax b, Excise ax © Documentary samp tax d. Income tax ‘Which of the following statements is incorrect with regard to large texpayers? 4 Business establishment with VAT paid or payable of at least one million (P1,000,000) for the preceding taxable year 'b. Business establishment with excise tax paid or payable of at least one million (P1,000,000) for the Preceding taxable year © Business with annul income tx pai or payable oft lest oe milion (P1,00,000 forthe preceding taxable year, 4. Business establishment with withholding tax payment of at least one rllion (P1,000,000) for the preceding taxable year ‘Any person who, in the course of trade or business, sells, barters, exchanges, leases goods or properties, renders services, and any person who imports goods shall be subject to: 1a Business tax VAT . Other percentage tax 4. Excise tax ‘A merchant of stock or securities, whether an individual, partnership or cosporation, with an established place of business, regularly engaged in the purchase of securities and the resale thereof to customers, and ‘Who, a8 a merchant, buys securities and resells them to customers with a view to the gains and profits that may be derived therefrom, a. Dealer in securities b.Stock brokers ¢, Underwriters 4. Stock merchants During the month of May, XYZ Corporation had domestic sales amounting to P1,680,000 and export sales ‘amounting to P1,500,000, During the same month, XYZ's total purchases directly attributable to domestic sales amounted to PI, 120,000 and total purchases directly attributable to export sales P1,008,000. For the ‘month of May, XYZ Corporation's VAT payable: a. (48,000.00) '. $4,000 «, 60,000 4. 62,000 Which ofthe following transactions is exempt from value-added-tax? | Medical services such as dental and veterinary services rendered by professionals. b. Legal services ©. Services arising from emplayee-emplayer relationship. 4. Services rendered by domestic air transport companies. Which of the following transactions is exempt from veluc-added-tax? 4. Sale of non-fod agricultural products in ther orginal state . Sale of non-food marine and forest products in their original state © Sale of cotton and cotton seeds 4. Sale of agricultural food products in their original state Which ofthe following transactions is exempt from value-added-tax? 4. Sale of books, newspaper and magazines. c. Sale of literary works b. Sale of work of art. 4. Sale of musical composition PWTAXO11 27234. Which ofthe following transactions is subject to value-added-tax? &. Services subject to other percentage tax. '. Educational services duly approved by Department of Education, CHED and TESDA or those ‘operated by the Government, ©. Sale of coal and natural gas, <4. Lending activities by credit cooperatives. 235, Which ofthe following transactions is subject to zero-rated value-added-tax? ‘2. Foreign currency denominated sales b._ Services rendered by banks, non-bank financial intermediaries, Generation, transmission and distribution of electricity Services rendered by professionals such as CPAs, Physicians and Lawyers 236, Sale of raw materials or packing materials to expo-oriented enterprise is considered export sles when export sles of such enterprise ‘Exceed $0% of total annual production «©, Exceed 66 2/3% of total annual production . Exceed 33 1/3% of total annual production _—_d. Exceed 70% of total annual production 237. Which ofthe following transactions is subject to zero-ated value-added-tax? 1. Services by regional or area headquarters of multi-national corporations, b. Sale to Philippine Economic Zone Authority. ¢.Sales by non-agricultural, nonclectri, non-credit cooperatives. ‘4. Importation of professional instruments and implements by settlers in the Philippines. 238, Which ofthe following businesses is allowed a presumptive input value-added-tax? a Manufacturer of canned goods. ©. Manufacturer of packed noodle based instant meals ', Manufacturer of packed juices, 4. Manufacturer of dred fish 239. 1 Statement: The input value-added-tex on purchase of capital goods valued at P1,000,000 shall be spread over 60 months ifthe life of property is equivalent to 5 years or more 2 Suuement: The input value-added tax on purchase of capital goods valued at P1,000,000 shall be spread over the life of propery ifthe life of property is less than 5 yeas, ‘a, True, true b. False, rue. Tue, false. Fase, false 240, A VAT-reistered person whose total sales forthe year did not exceed Php 1,919,500, now Pap 3M is a. Exempt from VAT c. Subject 10 0% VAT Subject to percentage tox Subject to 12% VAT 241. A non-VAT registered whose total sales forthe year exceeded Php 1,919,500, now Php 3M is 2, Exempt from VAT ‘c. Subject to 0% VAT 'b. Subject to percentage tax 4. Subject to 12% VAT 242, Export sales of non-VAT registered person is a. Exempt from VAT ©. Subject 10 0% VAT 1b. Subject to percentage tax 4. Subject to 12% VAT ‘243. The ITR of the individual taxpayer forthe calendar year 2008 was filed on April 1, 2009, the last dey for the BIR to assess is April 1, 2012 b. April 15, 2012 ce. April1, 2014, April 15, 2014 244, Assume that it was filed on April 1, 2009, the last day fr the BIR to collect without prior assessment is ‘a April, 2012 tb. April 15, 2012 ce. April 1, 2014 d. April 15, 2014 24S. Assume tht it was ied on Apri 30, 2009, the lat dy forthe BIR to asses i a apis, 2012. ap l3, 2014 “LApi30, 2012 4. Apil30,2014 246, Assume that it was filed on April 30, 2008, the last day forthe BIR to collect without prior assessment is ‘April 15, 2012 ‘April 15, 2014 , April 30,2012 d. April 30, 2014 PWTAXG-IL 28day for the BIR to collect by judicial of summary proceedings is, a June 15, 2015, b. June 15, 2017 ©, July 15,2014 4. No more because there is prescription on the part of the BIR to make the assessment | 247, Assume that it was filed on July 15, 2009. Assessment was made by the BIR on June 15, 2012. Pe | I 248. Assume that it was filed on April 15, 2009, the BIR discovered that fraud was committed by the taxpayer, s0 an assessment for deficiency tax was issued on July 15, 2016, The last day for the BIR to collect by judicial or summary proceedings is a. July 15, 2019 b. July 15,2021 July 15, 2026 44. No more because there is prescription on the right ofthe BIR to make the assessment 249, The date the notice of informal conference was rece day for the taxpayer to respond is a September 19, 2011. September 4, 2012 ©. October 4, 2011. October 19, 2011 by the taxpayer was September 4, 2011. The last 250, The last day for the taxpayer to respond if the date of pre-assessment notice was received on June 14, 2011 is a. July 14, 2011 bs. June 29, 2011 c.July 29,2011 d. June 14, 20129 251, The last day for the taxpayer to file a protest with the CIR, ifthe formal letter of demand and assessment was received by the taxpayer on November 10, 2011 is 2 December 5, 2011 b, December 10,2011 4, January 10,2012 4. December 25, 2011 252, A filed his income tax return for 2009 on April 15, 2010 and paid the tax of P 20,000, Upon aueit by the BIR an assessment notice was issued on May 15, 2012 requiring him to pay a deficiency tax of P40,000 ‘not later than July 15,2012. A may ‘8. Go tothe CTA to appeal the assessment made by the BIR b. Goto the Supreme Court ifthe issues involved are pure questions of law ‘¢_Ignore the assessment as the date of collection is beyond 3 years asthe taxable year covers 2008. ‘4. Request for an extension of time to pay the deficiency income tax ‘253, Date the national internal revenue tax was paid ~ April 10, 2010. Clair for refund was filed with the ‘Bureau of Imeal Revenue ~ March 19, 2011, Date decision of denial of refund was received ~ March 21, 2012, Last day to appeal to the Court of Tax Appeals. ‘April 20, 2012 ’, April 10, 2012 April 21,2012 4. April 15, 2012 254, ‘The powers and duties of the BIR include the following, except 'a. Toeffect and administer the police and supervisory powers conferred by the Tax Code and other related laws The execution of judgment in all cases decided in its favor by the Court of Appeals and ordinary courts €. Toenforce all forfeitures, penalties and fines in connection withthe collection of national internal revenue taxes 4, The assessment and collection ofall national and local revenue taxes. 255, Which of the following statements is not correct? a. If with prior assessment, collection of the tax can be by suunmary proceedings 'b. If with prior assessment. collection ofthe tax can be by judicial proceedinas ‘e. If without prior assessment, collection of the tax can be by judicial proceedings 4. without prior assessment, collection ofthe tax can be by summary proceedings 256, The following are the requisites forthe exercise of the remedy of distraint and levy, except ‘The taxpayer must be delinquent in the paynient of tax ‘The tax due should be atleast P1,000 ‘The taxpayer failed to pay the tax at the time required The period to collect the tax has not yet prescribed PWTAX-0.11 29257. The revenue district office can carry out proceedings of a distraint of personal property when the tax liability is not more than a. PI00 .P1,000 «. P100,000 4. PI,000,000 258, Which of he following statements isnot correct? a. The CTA. in the intrest of the goverment and/or the taxpayer may suspend the collection of a tax and. require the taxpayer either to depost the amount claimed or to file a surety bond for not more than the amount du with the court 8. Asa rule, no cour shall have the authority to grant an injunction to resin the collection of any | national intemal revenue tax, fee or charge imposed by the NIRC ©. The prescription of a refund check or warrant shall be within $ years fom the date the said warrant of check was mailed or delivered 4. The prescription of a tax credit certificate shall be within $ years from the date of issue, unless revalidated 259, P, a Filipino citizen residing in Makati City, owns @ vacation house and lot in San Francisco, California, USA, which he acquired in 2000 for P1SM. On January 10, 2012, he sold said real property to J, another Filipino citizen residing in Quezon City for P20M. On February 9, 2012, P filed the capital gains tax ‘return and paid P1.2M represemting 6% capital gains tax. Since P did not derive any ordinary income, no income tax return was filed by him in 2012. Aer the tax audit conducted in 2013, the BIR officer assessed P for deficiency income tax corsputed as follows: PSM ( P20M less PISM) x 30% = P1SM, ‘without the capital gains tax paid being allowed as tax credit. P consulted a real estate broker who ssid that the P1.2M capital gains tax should be credited ffom the PI.5M deficiency income tax. Is the BIR, officer's tx assessment correct? ‘a. Yes, assessment issued by the BIR is presumed correct ._ Yes, because the vacation house is located in USA I No, the capital gains tax paid should have been deducted from the P1.5M deficiency income tax 4. No, because the 30% tax rate applies to corporations 260. Which ofthe following propositions may now be untenable? 4 The cout shuld consrealnw granting tx exemption scl agsns the taxpayer I The Cour of Tax Appeals he uration over denon ofthe BIR Commissioner in cases involving national internal revenue taxes «The Supreme Court has jurisdiction fo review decisions ofthe Cur of Tax Appeals 4. The court should construe la granting a raniipal corporation the power te tax ost sel. 261. Due to an uncertainty whether or not a new tax law is applicable to printing companies, ABC Printers submitted afegal query tothe BIR on tat issue “The BIR sued a ruling that pining companies are not covered by the new law. Relying on this ruling, ABC Printers did not pay the said tax. Subsequently however, the BIR reversed the ruling end issued a new one stating that the tex covers pining companies. Could the BIR assess ABC Printers for back axes comesponng to the years before the new ruling? Yes, because taation isthe ue and exemption isthe exception 3. Yes, because taxes are the feblood of the government €. No, the BIR isnot allowed to reverse its ruling No, reversal ofa ruling shall pot be given a retroactive aplication if it wil be prejudicial to the taxpayer 262. From the date of the last entry in each book, book of accounts and other accounting records should be preserved by the taxpayer for a period of at least a Dears b. Syears ec dynars od. Sears 263. The official action of an officer authorized by law in ascertaining the amount of tax due under the law from a taxpayer is a. Assessment _, Delinquency ©. Deficiency 4, Distraint 264, The failure of the taxpayer to pay tax due on the date fixed by law or indicated in the assessment notice or ewer of demand a. Assessment. Deficiency ¢ Delinquency 4, Disteaint PW-TAXO-11 30265. The amount still due and collectible from a taxpayer upon audit or investigation a Assessment, Delinquency . Deficiency 4. Distraint 266. The seizure by the government of personal property to enforce the payment of taxes to be followed by its public sale ifthe taxes are not voluntarily paid 4 Assessment ——_-b, Delinquency eLevy 4, Distraint 267. The seizure by the government of real property to enforce the payment of taxes to be followed by its public, sale ifthe taxes are not voluntarily paid 2 Assessment —_b. Delinquency Ley 4. Distraint 268. As regards taxable year, one of the following statements is not correct The taxable year isthe accounting period b. The texable year maybe less than 12 months. ‘c.The taxable year ofa sole proprietorship business maybe fiscal or calendar year 4. The taxable year of a domestic corporation maybe fiscal or calendar year. 268. ‘The power to interpret the provisions of the Tax Code and other tax laws shall be under the exclusive and original jurisdiction ofthe a. Regional Trial Court Court of Tax Appeals b. Secretary of Finance Commissioner of Internal Revenue 270, Using No. 269, the power referred to above is subject to review by ‘a. Courtof Tax Appeals «Regional Trial Court {b. Commissioner of Intemal Revenue d. Secretary of Finance 271. The power to decide disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties imposed in relation thereto, or other matters arising under the Tax Code or other laws oF provisions thereof administered by the BIR is vested inthe Secretary of Finance ‘© Court of Tax Appeals b. Regional Trial Court 4, Commissioner of Internal Revenue 272. The power referred to above is subject to the exclusive appellate jurisdiction of the a. Commissioner of Internal Revenue —_¢, Secretary of Finance b. Regional Trial Court 4. Court of Tax Appeals 273. The Commissioner of Internat Revenue may compromise the payment of any internal revenue tax when J. Arreasonable doubt as to the validity of the ciaim against the taxpayer exists I The tax or any portion thereof appears to be unjustly or excessively assessed, IIL The financial position of the taxpayer demonstrates a cler inability to pay the assessed tax, a Yand band Hand 2, Mand 274, The Commissioner of Internal Revenue may abate or cancel the tax liability when The administration and collectioa costs involved do not justify the collection of the amount due Il, A reasonable doubt as tothe validity ofthe claim against the taxpayer exists IIL The tax or any portion thereof appears to be unjustly or excessively assessed. IV. The financial position of the taxpayer demonstrates a clear inability to pay the assessed tax, a Only! bb, Tand If Land 4 Tand IV 215, The following reasons maybe given by a taxpayer in refusing to pay his tex acceptable for legally refusing to pay the tax? ‘2 That he has been deprived of due process of law '. That there is no territorial jurisdiction ‘That the prescript on period forthe collection of tax has lapsed 4. That he will derive no benefit from the tax liability. Which is not 276, Statement 1 ~ The CTA is now considered as having the same level as the CA, and shall be composed of 1 presiding justice and 8 associate justices. Statement 2 ~The CTA may sit in en banc or in3 divisions composed of thee justices for each division. a. True, rue b. True, false c.False false d. False, true PWTAXO-I1 31277. One of the following is required to issue receipts or sales invoice | ya Seller of merchandise whose sales amounted to P 25. or more . Market vendors exclusively selling domestic meat, vegetables, fruits, poultry, fish and other food products, ¢. Seller who is exempted by the commission of Internal Revenue in meritorious eases 4. Seller of merchandise whose sales amounted to les than P 25, 278, An individual taxpayer, other than a corporation may elect to pay the income tax due in two equal installments if the tax due ‘@.Morethan P100 b. Morethan P1000 ¢, Morethen P 2,000 d. More than P 5,000 279. The period of limitation for assessment of taxes isnot suspended ‘8. The return filed contained inaccuracies due to omissions and mistakes 'b. There is failure to file the required return ©. The taxpayer and the CIR agreed on the extension of the period 4. The return filed is fraudulent and made with the intent to avoid the tax. PWTAXON 32