Name: Class: Date:: 26 Questions

NAME
:
CLASS :
NMC - Income Tax (Q1)
26 Questions DATE :
1. Pedro, single, is a Minimum Wage Earner. In addition to basic minimum wage of P180,000
for the year 2021, he also received the following benefits:
- De minimis benefits P140,000 excluding Productive Incentive Pay (P80,000 over ceiling)
-13 month pay and other benefits of P140,000
How much is the total exempt benefits (including de minimis benefits)?
A P230,000 B P90,000
C P140,000 D P130,000
How much is the total exempt benefits (excluding de minimis benefits)?
A P230,000 B P90,000
C P140,000 D P130,000
How much is the taxable income?
A P230,000 B P90,000
C P140,000 D P130,000
How much is the Income Tax Due?
A P30,000 B P80,000
C P40,000 D 0
How much is the Income Tax Due of Pedro in 2021 assuming he also earned P450,000
derived from his business of buying and selling various consumer products?
A P30,000 B P38,000
C P68,000 D P75,000
6. Which of the following statements regarding minimum wage earner (MWE) is correct?
The MWE is exempt from differential,

The MWE is exempt from income tax on
A B income tax on his overtime and hazard
his basic statutory minimum wage (SMW)
pay, holiday pay, night shift pay.
The MWE is subject to income tax on

C income other than those mentioned in "a" D All of the above
and "b"
7. What is the correct treatment of overtime pay, holiday pay, night shift differential, and
hazard pay received by those whose basic pay is more than the SMW?
Subject to income tax, and

A Exempt from income tax. B consequently, to the withholding income.
tax on compensation
Considered as fringe holding

benefit subject to fringe managerial or
C D None of the above.
benefit tax, provided the supervisory
employee is position.
8. Minimun Wage Earners (MWEs) receiving "other benefits" exceeding P90,000 limit shall be
an employee
Taxable on the
receiving
excess benefits as
compensation
A Taxable on the excess benefits only B well as his salaries,
income beyond the
wages and
statutory minimum
allowances, just like
wage.
C Exempt from income tax D Exempt from income tax
9. What tax scheme can a purely compensation income earner choose in solving for his/her
tax liability?
A Graduated Income Tax Rate (GITR) only B GITR / 8% Preferential Tax Rate
C 8% Preferential Tax Rate only D No correct answer
10. What tax scheme can sole proprietors and professionals choose in solving for their tax
liability?
11. What tax scheme can a mixed income earner choose in solving for tax liability with regards
to his compensation income?
to his business income?
to his income from practice of profession?

14. Nonita Coza, a CPA practicing her profession, elected to file her Income Tax Return using 8%
Preferential Tax Rate. In her Annual ITR, the total Gross income she earned in the year 2021
amounted to P4,500,000. What tax scheme should she use in solving for her Income Tax
Due for the year 2021?
15. In the year 2018, TRAIN Law was implemented. Under the said law, Tax Table for Individual
Income Tax was changed. What is the maximum taxable income which is subject to
exemption under the New Graduated Income Tax Table?
A P400,000 B P250,000
C P300,000 D P150,000
16. Individual Taxpayer is a businessman who opted to be taxed using the 8% Preferential Tax
Rate, how much is his Income Tax Liability?
Gross Income from Business 2,800,000
Itemized Deductions 1,000,000
Other Non-Operating Income 100,000
A P2,650,000 B P212,000
C P232,000 D P460,000
17. Individual Taxpayer is a businessman who wanted to be taxed using the 8% Preferential Tax
Rate but didn't signify the BIR of this intention, how much is his Income Tax Liability?
A P2,650,000 B P212,000
C P232,000 D P460,000
Rate, how much is his Income Tax Liability?
A P1,002,000 B P360,000
C P348,000 D P1,322,000
19. Individual Taxpayer is a businessman who wanted to be taxed using the 8% Preferential Tax
Rate but didn't signify the BIR of this intention.
Is the taxpayer subject to Business Tax?
A YES B NO
Rate.
Is the taxpayer liable to pay Percentage Tax for his Gross Income?
A Yes B No
21. Individual Taxpayer is a businessman with the following records in the year 2021:
Is the taxpayer liable to pay for Business Tax?
A Yes, VAT. B No
C Yes, Percentage Tax.

22. Individual Taxpayer is a businessman with the following records in the year 2021:
A Yes, VAT. B No
C Yes, Percentage Tax.
23. How much is the VAT Threshold under the TRAIN Law?
A P1,999,999 B P3,000,000
C P5,000,000 D P2,000,000
24. Income Taxpayer is a Mixed Income Earner earning income from Employment and
Business. Taxpayer did not opt to be taxed at 8% Preferential Tax Rate.
Taxable Compensation Income 2,000,000
How much is the TAXABLE INCOME?
A P2,600,000 B P3,100,000
C P2,850,000 D P4,100,000
Business.
Taxpayer opted to be taxed at 8% Preferential Tax Rate.
How much is the Total Income Tax Liability? (5 minutes)
A P358,000 B P3,100,000
C P338,000 D P328,000
Business. Taxpayer did not opt to be taxed at 8% Preferential Tax Rate.
A YES B NO

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The MWE is exempt from differential,

The MWE is subject to income tax on

Subject to income tax, and

Considered as fringe holding

C Exempt from income tax D Exempt from income tax

C 8% Preferential Tax Rate only D No correct answer

C 8% Preferential Tax Rate only D No correct answer

C 8% Preferential Tax Rate only D No correct answer

C 8% Preferential Tax Rate only D No correct answer

C 8% Preferential Tax Rate only D No correct answer

C 8% Preferential Tax Rate only D No correct answer

C Yes, Percentage Tax.

C Yes, Percentage Tax.

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