QUIZ NO.

2 – ANSWER KEYS

1. Which of the following will constitute a taxable income? Prize won in an essay
contest the recipient joined.

2. In 2018, Mr. Mark Louie Ballesteros, a financial comptroller of ML Company, earns

annual compensation of P1,500,000, inclusive of 13th month and other benefits in
the amount of P80,000 and mandatory SSS contribution of P3,500 and Philhealth
contribution of P2,000. Aside from her employment income, she owns a
convenience store, VAT-registered, with gross sales of P3,000,000. Sales discount
amounts to P300,000; sales returns and allowances amount to P150,000. Her cost of
sales and operating expenses are P1,000,000 and P600,000 respectively and with
non-operating income of P100,000. Payments for the first three (3) quarters amount
to P300,000. Can he avail of the 8% income tax rate? No, because he is VAT-
registered.

3. In 2018, Mr. Christian Khael Domingo, a financial comptroller of CK Company, earns

annual compensation of P1,650,000, inclusive of 13th month and other benefits in
the amount of P80,000 and mandatory SSS contribution of P3,500 and Philhealth
contribution of P2,000. Aside from his employment income, he owns a
convenience store, VAT-registered, with gross sales of P3,000,000. Sales discount
amounts to P300,000; sales returns and allowances amount to P150,000. His cost of
sales and operating expenses are P1,000,000 and P600,000 respectively and with
non-operating income of P100,000. Payments for the first three (3) quarters amount
to P300,000. How much is his total taxable income? P2,614,500

SOLUTION:

Total compensation income P1,650,000

Less: Non-taxable 13th month and other benefits
80,000
Mandatory SSS contribution 3,500
Mandatory Philhealth contribution 2,000 85,500
Taxable compensation income 1,564,500
Gross sales 3,000,000
Less: Sales discount ( 300,000)
Sales returns and allowances ( 150,000)
Net sales 2,550,000
Less: Cost of sales (1,000,000)
Gross income 1,550,000
Less: Operating expenses 600,000
Net income from operation 950,000
Add: Non-operating income 100,000 1,050,000
Total taxable income P2,614,500

4. In 2018, Ms. Karen Kaye Mabanta, a financial treasurer of KK Company, earns annual
compensation of P1,850,000, inclusive of 13th month and other benefits in the
 amount of P80,000 and mandatory SSS contribution of P3,500 and Philhealth
contribution of P2,000. Aside from her employment income, she owns a convenience
store, VAT-registered, with gross sales of P3,000,000. Sales discount amounts to
P300,000; sales returns and allowances amount to P150,000. His cost of sales and
operating expenses are P1,000,000 and P600,000 respectively and with non-
operating income of P100,000. Payments for the first three (3) quarters amount to
P300,000. How much is her tax due when she files her final tax return? 450,640

Total taxable income P2,814,500

Tax due Sec. 24 (A) 2,000,000 490,000
814,500 x 32% 260,640 P 750,640
Less: Payments, first 3 quarters 300,000
Tax payable P 450,640

5. Liam Benedict Fronda, a purely self-employed individual’s gross sales/receipts and

other non-operating income do not exceed the VAT threshold. He signified his
intention to avail of the 8% income tax rate on his first quarter return, he will pay:
income tax on gross sales/receipts and other non-operating income in excess
of P250,000 in lieu of graduated tax rates and percentage under Section 116

6. Keziah Fronda, a purely self-employed individual’s gross sales/receipts and other

non-operating income do not exceed the VAT threshold. She failed to signify his
intention to avail of the 8% income tax rate on his first quarter return, he will pay:
income tax based on graduated income tax rates and percentage tax under
Section 116 if not VAT-registered

7. Under the TRAIN, the income tax due from compensation income is: based on
graduated income tax rates under Section 24 (A)

8. First statement: On or before the end of the calendar year but prior to the payment
of the compensation for the last payroll period, the employer shall determine the tax
due from each employee on taxable compensation income for the entire taxable year
in accordance with
Section 24(A).

Second statement: The difference between the tax due from the employee for the
entire year and the sum of taxes withheld from January to November shall either be
withheld from his salary in December of the current calendar year or refunded to
the employee not later than
January 25 of the succeeding year. Both statements are correct

9. Which is FALSE?
S1 – A minimum wage earner’s basic salary becomes taxable if it will exceed the Php
250,000. FALSE
 S2 – If a minimum wage earner earned other income, only the other income not
otherwise exempted is taxable TRUE
S3 – If a minimum wage earner earns income from his business, he is classified as a
mix income earner TRUE
S4 – If the minimum wage earner’s business income does not exceed Php 250,000,
his income is exempt from taxation TRUE

10.Which is FALSE?
S1 – An individual employee cannot claim the Php 250,000 deduction on his taxable
compensation TRUE
S2 – An individual engaged in trade who opted 8% tax is allowed to claim Php 250,000
deduction on his gross income FALSE
S3 – An individual purely engaged in practice of profession cannot claim the Php
250,000 deduction if he opted graduated tax TRUE
S4 – A mix income earner can either use 8% or graduated tax on his business income
TRUE

11.Who is required to file an Annual Income Tax Return (AITR)?

Erianne who has simultaneous (two) employers during the year.
Naya whose income tax due on his compensation is Php 50,000 while the tax
withheld by employer is Php 60,000. The overpayment has been refunded to him
already.
Carl who was employed from January 1 but was terminated upon end of contract
on June 30. He was later employed in another company from July 1 to December 31.
Yvon, a non-resident alien engaged in trade or business
All of them

12.Which of the following income MAY BE EXCLUDED from Gross Income due to its
nature?
S1–Pension
S2–Foreign-sourced dividends
S3 –Raffle Prize in the amount of Php 20,000 S4 – Retirement Pay All

13.A taxpayer made available the following financial information:

Gross receipts - Php 10,000,000
Cost of service – Php 6,000,000
Expenses:
Salaries and wages – Php 1,000,000
Transportation and travel – Php 20,000
Rental - Php 240,000
Representation expense – Php 100,000
Depreciation expense – Php 200,000
Office supplies – Php 20,000
Miscellaneous expenses – Php 10,000
How much is the income tax due if the taxpayer is an individual resident citizen?
Php 621,200
 SOLUTION:
Gross receipts
10,000,000
Less: Cost of service
6,000,000
Gross income 4,000,000
Less: Expenses 1,590,000
Taxable income 2,410,000
Tax Due 621,200

14.Dr. Mark Kenneth Marcos is a resident doctor of MKM Hospital. At the same time, he
operates his own clinic. MKM Hospital and Mark Kenneth’s clinic are both accredited
by PhilHealth. The following were disclosed to you by Nicanor:
Income from MKM Hospital:
Gross Compensation – Php 2,800,000
13th month pay and other benefits – Php 200,000
SSS, Philhealth and other mandatory contributions – Php 50,000
Income from Clinic:
Gross receipts:
From Walk-in patients with issued receipts - Php 1,000,000
From patients paid for by Philhealth – Php 1,000,000
Expenses:
Office Rental – Php 250,000
Representation expense – Php 100,000
Salary of staff nurse – Php 250,000
Salary of family driver – Php 120,000
Salary of kasambahay – 60,000
Gas and oil – Php 50,000
Utilities expense (office) – Php 100,000
Utilities expense (house) – Php 250,000
Other information:
Receipts from patients with no issued official receipts – Php 2,000,000 Under-the-
table (not reported)
Commissions from pharmaceutical companies due to referrals/prescriptions of
medicines – Php 500,000
Quarterly Income tax payments – Php 30,000
Tax withheld by PhilHealth (with BIR Form 2307) – Php 100,000
Tax withheld by MKM Hospital (with BIR Form 2316) – Php 300,000
How much is the total taxable gross receipts? Php 4,500,000

SOLUTION: Gross receipts

Walk-in – 1M
Paid for by PhilHealth – 1M
Undeclared receipts – 2M
Commission – 500K
15. Dr. Mark Kenneth Marcos is a resident doctor of MKM Hospital. At
the same time, he operates his own clinic. MKM Hospital and Mark
Kenneth’s clinic are both accredited by PhilHealth. The following were
disclosed to you by Nicanor:

Income from MKM Hospital:

Gross Compensation – Php 2,800,000
13th month pay and other benefits – Php 200,000
SSS, Philhealth and other mandatory contributions – Php 50,000
Income from Clinic:
Gross receipts:
From Walk-in patients with issued receipts - Php 1,000,000
From patients paid for by Philhealth – Php 1,000,000
Expenses:
Office Rental – Php 250,000
Representation expense – Php 100,000
Salary of staff nurse – Php 250,000
Salary of family driver – Php 120,000
Salary of kasambahay – 60,000
Gas and oil – Php 50,000
Utilities expense (office) – Php 100,000
Utilities expense (house) – Php 250,000
Other information:
Receipts from patients with no issued official receipts – Php 2,000,000
Under-the-table (not reported)
Commissions from pharmaceutical companies due to
referrals/prescriptions of medicines – Php 500,000
Quarterly Income tax payments – Php 30,000
Tax withheld by PhilHealth (with BIR Form 2307) – Php 100,000
Tax withheld by MKM Hospital (with BIR Form 2316) – Php 300,000
How much is the INCOME TAX PAYABLE for the year? Php
1,488,800

SOLUTION:
Gross receipts 4,500,000
Less: Cost/Allowable 695,000
deductions
Gross Income 3,805,000
Add: Taxable compensation 2,660,000
Total taxable income 6,465,000

Tax due 1,918,800

Less: Tax credits:
 Quarterly ITR 30,000
Philhealth 100,00
0
ABC Hosp 300,00 430,000
0
Income Tax Payable 1,488,800

16. Dr. Mark Kenneth Marcos is a resident doctor of MKM Hospital. At

the same time, he operates his own clinic. MKM Hospital and Mark
Kenneth’s clinic are both accredited by PhilHealth. The following were
disclosed to you by Nicanor:
Income from MKM Hospital:
Gross Compensation – Php 2,800,000
13th month pay and other benefits – Php 200,000
SSS, Philhealth and other mandatory contributions – Php 50,000
Income from Clinic:
Gross receipts:
From Walk-in patients with issued receipts - Php 1,000,000
From patients paid for by Philhealth – Php 1,000,000
Expenses:
Office Rental – Php 250,000
Representation expense – Php 100,000
Salary of staff nurse – Php 250,000
Salary of family driver – Php 120,000
Salary of kasambahay – 60,000
Gas and oil – Php 50,000
Utilities expense (office) – Php 100,000
Utilities expense (house) – Php 250,000
Other information:
Receipts from patients with no issued official receipts – Php 2,000,000
Under-the-table (not reported)
Commissions from pharmaceutical companies due to
referrals/prescriptions of medicines – Php 500,000
Quarterly Income tax payments – Php 30,000
Tax withheld by PhilHealth (with BIR Form 2307) – Php 100,000
Tax withheld by MKM Hospital (with BIR Form 2316) – Php 300,000
How much is the expanded withholding tax required to be
withheld by Dr. Mark Kenneth Marcos? Php 12,500 (Rental 250,000
x 5% = 12,500)

17. The following cash benefits were given to Kyle Katrina Marcos:
Monetized vacation leave credits (20 days at Php 1,000 per day) – Php
20,000
 Monetized sick leave credits (20 days at Php 1,000 per day) – Php
20,000
Uniform allowance – Php 10,000
Christmas cash gift – Php 10,000
Employee achievement award (loyalty award) – Php 10,000
Annual medical assistance – Php 10,000
You were preparing the Certificate of Compensation Payment / Tax
Withheld (BIR Form 2316) of Ms. Kyle Katrina Marcos. How much is
the total de minimis benefits that should appear in the BIR
Form 2316 assuming Ms. Kyle Katrina is employed by a private
company? Php 31,000

SOLUTION:
Monetized vacation leave credits (10 days at Php 1,000 per day)
-Php 10,000
Uniform allowance – Php 6,000
Christmas cash gift – Php 5,000
Annual medical assistance – Php 10,000

18. The following cash benefits were given to Gina Tejada:

Monetized vacation leave credits (20 days at Php 1,000 per day) – Php
20,000
Monetized sick leave credits (20 days at Php 1,000 per day) – Php
20,000
Uniform allowance – Php 10,000
Christmas cash gift – Php 10,000
Employee achievement award (loyalty award) – Php 10,000
Annual medical assistance – Php 10,000
You were preparing the Certificate of Compensation Payment / Tax
Withheld (BIR Form 2316) of Ms. Gina Tejada. How much is the total
de minimis benefits that should appear in the BIR Form 2316
assuming Ms. Gina Tejada is employed by a government
employee? Php 61,000

SOLUTION:
Monetized vacation leave credits (20 days at Php 1,000 per day)
– Php 20,000
Monetized sick leave credits (20 days at Php 1,000 per day)
– Php 20,000
Uniform allowance – Php 6,000
Christmas cash gift – Php 5,000
Annual medical assistance – Php 10,000

19. The following information appeared in the 2020 BIR Form 2316
(Certificate of Compensation Payment/Tax Withheld) of Gwen Balagot,
a purely compensation income earner:
 Gross compensation income - P 400,000
13th month pay and other benefits - P 40,000
SSS - P10,000
Philhealth contributions - P 10,000
Pagibig contributions - P 10,000
Union dues - P 10,000
Commission - P 50,000
Amount of taxes withheld (by the employer) - P 30,000

Question: The total non-taxable portion to be deducted from

gross compensation income of Gwen Balagot is: Php 80,000

20. The following information appeared in the 2020 BIR Form 2316
(Certificate of Compensation Payment/Tax Withheld) of Mariam
Manongdo, a purely compensation income earner:
Gross compensation income - P 400,000
13th month pay and other benefits - P 40,000
SSS - P10,000
Philhealth contributions - P 10,000
Pagibig contributions - P 10,000
Union dues - P 10,000
Commission - P 50,000
Amount of taxes withheld (by the employer) - P 30,000

The net taxable compensation income to be used in computing

the tax is: Php 320,000

SOLUTION:

Gross compensation 400,00

income Less: 0
13th month pay and other benefits 40,000.0
0
SSS 10,000.0
0
Philhealth 10,000.0
contributions 0
Pagibig contributions 10,000.0
0
Union dues 10,000.00 80,000
Net taxable compensation income
320,000

21. Djay Ortiz, an employee of LMN Corp., suffered an accident at

work and died. The following are information were made available by
the employer:
 Basic salary - P 600,000
13th month pay and other benefits - P 100,000 (90,000 ONLY)
Commission - P 100,000
Separation Pay - P 500,000
Gross compensation income - P 1,300,000
Question: How much is the total exclusions from gross income?
Php 590,000

22. A taxpayer made available the following financial information:

Gross receipts - Php 10,000,000
Cost of service – Php 6,000,000
Expenses:
Salaries and wages – Php 1,000,000
Transportation and travel – Php 20,000
Rental - Php 240,000
Representation expense – Php 100,000
Depreciation expense – Php 200,000
Office supplies – Php 20,000
Miscellaneous expenses – Php 10,000
How much is the income tax due if the taxpayer is an ordinary
partnership? Php 2,410,000

SOLUTION:

Explanation/Solution
Gross receipts 10,000,000
Less: Cost of service 6,000,000
Gross 4,000,000
income
Less: Expenses 1,590,000
Taxable income 2,410,000

23. 13th month pay are required to be paid on or before December

24

24. Which is FALSE?

S1 – All income are taxable.
S2 – All exclusions from gross income are exempted.
S3 – All passive income subjected to final tax are not items of gross
income
S4 – All income exempted by law or treaty are exempted from income
tax

25. Atty. Acoon had the following income during the year:
Gross compensation income including P35,000 13th month pay - P
325,000
 Less: Tardiness or absences - 10,000
Net compensation income - P 315,000
SSS deductions - 15,000
Philhealth deductions - 12,000
Pag-ibig deductions - 15,000
Union dues - 10,000
Withholding tax - 25,000
Net pay - P 213,000
Compute the total exclusions from gross income. 87,000

26. Khit Bautista had the following income during the year:

Basic Salary - P 2,500,000

Withholding tax - 50,000
13th month pay - P 150,000 (90,000 ONLY)
SSS deductions - 2,500
Philhealth deductions - 2,500
Pag-ibig deductions - 3,500
Union dues - 1,200
Capital build up contribution in a social fund - 3,000. Compute the total
exemptions and exclusions from gross income. 99,700

27. Which of the following government-owned and controlled

corporations is subject to income tax? National Development
Corporation (NDC)

28. Termination benefits are exempt from income tax provided that
the reason for termination is beyond the employee's control

29. Which of the following is not an exclusion from gross income?

Income of government properties

30. Which is not an acceptable ground for exemption of termination

pay? Grave misconduct and neglect of duty

31. Which is correct with respect to exclusions from gross income?

They are not considered in the computation of taxable income

32. Which is correct with respect to deductions from gross income?

They pertain to expenses of generating items of business or
professional gross income

33. Princess and Agustito practice their accounting profession

through a general profession partnership. They contributed equal
capital and agreed to share in profits equally. The following relates to
their gross receipts and expenses:
 Gross Receipts Php 4,000,000
Less: Cost of Sales. 1,800,000
Gross Income from operations 2,200,000
Add: Other non operating income
Gain on sale of equipment 100,000
Interest on time deposits 40,000 140,000
Total Gross income Php 2,340,000
Less: Allowable deductions 1,200,000
Net profits Php 1,140,000

What is the reportable income in the tax return of Princess? P 570,000

(1,140,000/2)

34. Jhanelle and Dylan practice their accounting profession through a

general profession partnership. They contributed equal capital and
agreed to share in profits equally. The following relates to their gross
receipts and expenses:

Gross Receipts Php 4,000,000

Less: Cost of Sales. 1,800,000
Gross Income from operations 2,200,000
Add: Other non operating income
Gain on sale of equipment 100,000
Interest on time deposits 40,000 140,000
Total Gross income Php 2,340,000
Less: Allowable deductions 1,200,000
Net profits Php 1,140,000

Determine the amount of income to be reported by Dylan assuming

that their partnership is a milktea shop. P 0 (BUSINESS
PARTNERSHIP)

35. Mitos, a VAT taxpayer received P52,900 inclusive of VAT and net
of 10% creditable withholding tax. Compute the gross income subject
to regular tax. P 51,862.75 (52,900/102% = 51,862.75)

36. Kenneth John has several interests in various businesses and

partnerships. He received the following income during the year:

Dividends from a domestic corporation - 220,000

Dividends from a resident foreign corporation - 120,000
Share in net income of a business partnership - 250,000
Share in net income of a professional partnership - 150,000

What is the total income to be reported in gross income? P 270,000

37. A non-VAT taxpayer collected P45,000 net of P5,000 withholding
tax. Compute the gross income subject to regular tax. P 50,000
(45,000 + 5,000)

38. A VAT taxpayer collected P66,600, inclusive of P7,200 VAT and

net of P600 withholding tax. Compute the gross income subject to
regular income tax. P 60,000 (66,600 + 600 – 7,200)

39. A non-VAT taxpayer received P8,000 interest income, net of 20%

final withholding tax. Compute the amount subject to regular income
tax. P 0 (INTEREST INCOME IS SUBJECTED TO FINAL TAX)

40. A resident foreign corporate taxpayer entered into an advanced

pricing agreement (APA) with the BIR with respect to the pricing of its
export sales to a foreign country. A mark-up ratio of 50% of the cost is
set in the APA. During the year, the corporation manufactured goods
costing P20,000,000 and exported 75% of the production to its foreign
affiliate at a price of P20,000,000.

What is the amount of gross income subject to Philippine tax? P

7,500,000 (20,000,000 X 75% X 50%)

41. Alyssa Valdez collected the following passive income during the
year:

Passive Income Philippines Abroad

Interest Income from banks P 350,000 P 950,000
Royalties from books 550,000 150,000
Rent of properties 650,000 200,000

What is the amount to be reported in gross income if the taxpayer is a

resident citizen? P 1,950,000 (950,000 + 150,000 + 200,000 +
400,000)

42. Michelle Gumabao collected the following passive income during

the year:

Passive Income Philippines Abroad

Interest Income from banks P 350,000 P 950,000
Royalties from books 550,000 150,000
Rent of properties 650,000 200,000

What is the amount to be reported in gross income if the taxpayer is a

resident alien? P 650,000 (ONLY RENT OF PROPERTIES IN THE
PHILIPPINES)
43. Mr. Ventura is a 5-6 lender. During the yaar, he granted loans
totaling P2,000,000 and collected P500,000 in interest. He also earned
P10,000 in temporary investments in domestic bonds plus additional
P8,000 from bank deposit substitutes. Direct cost of lending was
P100,000.

What is the total amount to be reported in gross income subject to

regular tax? P 410,000 (500,000 – 100,000 + 10,000)

44. The following relate to the compensation income of a private

rank and file employee during the year:

Annual Compensation income P 540,000

13th month pay 45,000
14th month pay 45,000
Total monthly rice allowances during the year 26,000
Commission from employer 12,000
Christmas gift 8,000
SSS, PhilHealth, and HDMF contributions 21,000

Compute the taxable compensation income. P 536,000

SOLUTION:

ANNUAL COMPENSATION INCOME – 540,000

LESS: SSS, PHILHEALTH, HDMF – 21,000
ADD: SUPPLEMENTAL COMPENSATION – 17,000

45. The following relate to the compensation income of a private

rank and file employee during the year:

Annual Compensation income P 540,000

13th month pay 45,000
14th month pay 45,000
Total monthly rice allowances during the year 26,000 (2K PER
MONTH)
Commission from employer 12,000
Christmas gift 8,000 (5K ONLY
NON TAXABLE)
SSS, PhilHealth, and HDMF contributions 21,000

Compute the supplemental compensation income. P 17,000

SOLUTION:
 COMMISSION – 12,000
EXCESS 13TH AND OTHER BENEFITS (45000 + 45,000 + 2,000 +
3,000) – 90,000 = 5,000

46. The following relate to the compensation income of a private

rank and file employee during the year:

Annual Compensation income P 540,000

13th month pay 45,000
14th month pay 45,000
Total monthly rice allowances during the year 26,000
Commission from employer 12,000
Christmas gift 8,000
SSS, PhilHealth, and HDMF contributions 21,000

Compute the total non-taxable compensation income. P 140,000

SOLUTION:

13TH MONTH & OTHER BENEFITS – 90,000

EXEMPT DE MINIMIS – 29,000
CONTRIBUTION TO SSS – 21,000

47. The following relate to the compensation income of a private

rank and file employee during the year:

Annual Compensation income P 540,000

13th month pay 45,000
14th month pay 45,000
Total monthly rice allowances during the year 26,000
Commission from employer 12,000
Christmas gift 8,000
SSS, PhilHealth, and HDMF contributions 21,000

Compute the exempt de minimis benefits. P 29,000

SOLUTION:

RICE ALLOWANCE – 24,000 (2K X 12 MONTHS)

CHRISTMAS GIFT – 5,000

48. Leslee Joy, an employee received the following remunerations

aside from the basic pay:

Fixed representation and transportation allowance - P 32,000

Night shift differential pay - P 15,000
 Hazard pay - P 18,000
Honoraria - P 11,000
Profit sharing - P 30,000
13th month pay - P 25,000

Compute the supplemental compensation if Leslee Joy is a regular

employee. P 74,000

SOLUTION:

NIGHT SHIFT DIFFERENTIAL PAY – 15,000

HAZARD PAY – 18,000
HONORARIA – 11,000
PROFIT SHARING – 30,000

49. Mary Jane, an employee received the following remunerations

aside from the basic pay:

Fixed representation and transportation allowance - P 32,000

Night shift differential pay - P 15,000
Hazard pay - P 18,000
Honoraria - P 11,000
Profit sharing - P 30,000
13th month pay - P 25,000

Compute the supplemental compensation if Mary Jane is a minimum

wage earner. P 43,000

SOLUTION:

FIXED REPRESENTATION AND TRANSPORTATION ALLOWANCE –

P 32,000
HONORARIA – 11,000

50. Marionne, a government employee received the following

benefits in 2019:

Gross Salaries - P 1,044,000

RATA - 12,000
PERA - 24,000
Additional Compensation - 24,000
Christmas bonus - 87,000
Christmas gift - 5,000
Laundry allowance (P400/month) - 4,800
Contributions to GSIS, PhilHealth, and HDMF - 62,000
 Determine the taxable compensation income. P 1,009,200

SOLUTION:

GROSS SALES – 1,044,000

LESS: CONTRIBUTIONS – 62,000
ADD: ADCOM – 24,000
CHRISTMAS BONUS – 87,000
CHRISTMAS GIFT – 5,000
LAUNDRY ALLOWANCE (100 PER MONTH) – 1,200
LESS: LIMIT – 90,000

51. Dr. Stephen Uljano, a private employee had the following

remuneration in 2019:

Gross Salaries, net of P 11,000 mandatory contribution - P 350,000

Fixed RATA - 25,000
Cost-of-living allowance - 30,000
13th month pay - 28,000
Christmas gift - 5,000
Laundry allowance (500/month) - 8,000

What is the taxable compensation income? P 405,000

SOLUTION:

GROSS SALES – 350,000

FIXED RATA – 25,000
COLA – 30,000

52. Remedios Marcos, a private employee had the following

remuneration in 2019:

Gross Salaries, net of P 11,000 mandatory contribution - P 350,000

Fixed RATA - 25,000
Cost-of-living allowance - 30,000
13th month pay - 28,000
Christmas gift - 5,000
Laundry allowance (500/month) - 8,000

What is the total exempt de minimis benefit? P 8,600

SOLUTION:

CHRISTMAS GIFT – 5,000

 LAUNDRY ALLOWANCE (300 PER MONTH) – 3,600

53. Keano Marcos, a private employee had the following

remuneration in 2019:

Gross Salaries, net of P 11,000 mandatory contribution - P 350,000

Fixed RATA - 25,000
Cost-of-living allowance - 30,000
13th month pay - 28,000
Christmas gift - 5,000
Laundry allowance (500/month) - 8,000

What is the total exempt benefit? P 41,000

SOLUTION:

13TH MONTH PAY – 28,000

EXCESS DE MINIMIS (8,000 – 3,600) – 4,400
13TH MONTH PAY & OTHER BENEFITS – 32,400
DE MINIMIS BENEFITS – 8,600
TOTAL NON TAXABLE INCOME – 41,000