NAME: ________________________________________________ Income Tax Quiz Oct.

16, 2023

1. Maliv, single and sales executive of a leading pharmaceutical firm (Unilab), received in 2023 the ff.
from his employer:

Salary, net of Php 267,000 withholding tax Php 683,000

Allowances and benefits received:

✓ Rent paid by Unilab on the house which Maliv occupies for 129,200
residential purposes, net of 5% withholding

✓ Entertainment allowance subject to liquidation ( Php 75,000 was 100,000

duly receipted in the name of Unilab and used to entertain Unilab customers
and the balance of Php 25,000 was used to purchase a mobile phone
for the personal use of Maliv)

✓ Reimbursement of entertainment expenses paid by Maliv ( Php 17, 500 40,000

was used to entertain Maliv’s friends and the balance of Php 22,500 was used to
promote Unilab’s business)

✓ Fixed yearly allowance for entertainment 85,000

◼ How much is Maliv’s taxable income?

◼ How much is Income Tax Payable or Refund? See Tax Table below:

Solution:

2. ) Dr. S, an expert American Physicist was hired by a Philippine corporation to assist in its
organization & operation for which he had to stay in the Philippines for an indefinite period. His
coming to the Philippines was for a definite purpose which in its nature would require an extended
stay and to that end makes his home temporarily in the Philippines. The American management
expert intends to leave the Philippines as soon as his job is finished.
For income tax purposes, the American management expert shall be classified as:
A. Resident alien
B. Nonresident alien engaged in trade or business
C. Nonresident alien not engaged in trade or business
D. Resident citizen.
3. ) Rihanna, an American singer, was engaged to sing for one week at the Western Philippine Plaza
after which she returned to USA. For income tax purposes, she shall be classified as:
A. Resident alien
B. Nonresident alien engaged in trade or business
C. Nonresident alien not engaged in trade or business
D. Resident citizen.

4. ) Which type of taxpayer is taxable based on world income? _____________________

5. ) It is important to know the source of income for tax purposes (i.e. from within and without the
Philippines) because:
A. Some individuals and corporate taxpayers are taxable based on their worldwide income while
others are taxable from their sources within the Philippines.
B. The Philippines imposes income tax only on income from sources within.
C. Some individual taxpayers are citizens while others are aliens.
D. Export sales are not subject to income tax.

6. ) Makle is self-employed and a professional. He provided the ff. Info for the 2023 taxable year:
Gross sales Php 1,650,000
Cost of sales 500,000
Business expenses 425,000
Rental income (net) 308,750
Philippine Charity sweepstakes winnings 500,000
Royalty income - books 120,000
Other royalty income - Philippines 60,000
Dividend income - domestic corporations 40,000
Interest income, BDO IT Park 100,000
Interest income received from a depository bank
Under FCDS, Philippines 50,000
Quarterly tax payments 82,500

◼ How much is Makle’s income tax payable?

7. ) Dong Ryong has the ff. Income and expenses for the year 2023. He supports an 8-year old
illegitimate child.
Professional Income, net of Php 60,000 Php 540,000
withholding tax
Rental income (net) 47,500
Rewards as BIR informer 30,000
Wagering gains 50,000
Kickbacks received from suppliers of clients 40,000
Interest income on time deposit (net) 32,000
DIvidend income from domestic corporations 75,000
Professional expenses 325,000
Household expenses 24,000
Premium payment on health insurance 4,000
Facilitation fees paid to government agencies 15,000

◼ How much is Dong Ryong’s taxable income subject to regular tax for 2023?