Corrections for IRA No.

3, Problem (G)

Please see some corrections for IRA No. 3, Problem G (in red fonts).

G.
No. 1:
Fringe Benefits Tax:
Monetary value received:
Motor vehicle P1,020,000
De minimis benefits:
Rice allowance (147,200-24,000) 123,200
Medical allowance (101,800 – 10,000) 91,800
Total 215,000
Less – Other benefit exclusion (90,000) 125,000
Taxable monetary value (or value of benefit) P1,145,000
/ 65%
Grossed-up monetary value 1,761,538.46
x 35%
Fringe benefit tax P 616,538.46

Notes:
 The amount of P18,000 in the old solution provided was based on the OLD rice subsidy which
was still at P1,500 monthly.
 Updated rice allowance is now at P2,000 per month de minimis ceiling amount.

No. 2:
Amount of deduction for employer:
Motor vehicle 1,020,000.00
Rice allowance 147,200.00
Medical allowance 101,800.00
Total fringe benefits expense (including de minimis) 1,269,000.00
Fringe benefits tax expense 616,538.46
Total deduction for employer 1,885,538.46

No. 3:
Non-taxable Monetary Value:
De minimis within ceiling:
Rice allowance 24,000
Medical allowance 10,000 34,000
Other benefits 90,000
Non-taxable monetary value 124,000

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