16. Answer: B. 88,500.

Solution:

Business income, Philippines P300,000

Interest, deposit with Metrobank 3,000
Cash prize, local contest 6,000
Lotto, Philippines 20,000
Dividend from domestic company 25,000
Gross income 354,000
Tax rate 25%
Final Income tax 88,500

Nonresident alien not engaged in trade or business shall only be taxable on gross
income derived from sources within. The Philippine government cannot impose upon
them the obligation to file return due to territorial consideration. Thus, they are
subject to 25% final tax for both passive and active income. (Sec. 25 of NIRC Code of
1997)

17. Answer: D. 63,575

Solution:

Compensation income (P12,000*24) P288,000

Rent income (76,000/95%) 80,000
Self-employment income (500,000 -
105,000) / 2 197,000
Taxable income 565,500

Tax on P400,000 30,000

165,500*25% 41,375
Income tax due 71,375
Less: Withholding tax
On rent (4,000)
On compensation income
(3,800) 7,800
Tax Payable 63,575

Sec. 24. Income Tax Rates. Based on the tax schedule effective January 1, 2018 until
December 31, 2022, the tax for income over P400,000 but not over P800,000 is
P30,000 + 25% of the excess over P400,000.

For married individuals, the husband and wife, subject to the provision of Section 51
(D) hereof, shall compute separately their individual income tax based on their
respective total taxable income: Provided, That if any income cannot be definitely
attributed to or identified as income exclusively earned or realized by either of the
spouses, the same shall be divided equally between the spouses for the purpose of
determining their respective taxable income.
18. Answer: D. None. According to Sec. 51. Individual Return (NIRC Code of 1997),
A minimum wage earner as defined in section 22 (HH) of this Code or an individual
who is exempt from income tax pursuant to the provisions of this Code and other
laws, general or special. 

19. Answer: B. 7,000

Solution:

Royalty P70,000
Tax rate 10%
Final tax 7,000

According to Sec. 24. (B) Rate of Tax on Certain Passive Income, royalties, except
on books, as well as other literary works and musical compositions, shall be imposed
a final tax of ten percent (10%)

20. Answer: C. The optional standard deduction on individual is 40% of gross

sales/receipts from business and/or professional income. This is in accordance with
Sec. 34 Allowable Deductions (L) Optional standard Deduction (OSD).