Answer Key on

Comprehensive Exercise
Tax on Individuals
Case 1
Gross Business Income – Phil. P 2,000,000
Gross Business Income – Canada 3,000,000
Business Expenses - Phil. (1,400,000)
Business Expenses – Canada (2,050,000)
Interest Income – Canada 50,000
Dividend Income – RFC 75,000
Dividend Income – NRFC 102,000
Singapore Sweepstakes Winnings 200,000
Winnings – Robinsons Manila 8,000
Winnings – SM China 30,000
Total Taxable Income P 2,015,000
Case 1
Interest Income BDO (100,000 * 20%) 20,000
Dividend Income – DC ( 125,000 * 10%) 12,500
Interest Income FCDS (50,000 * 15%) 7,500
PCSO (500,000 * 20%) 100,000
Other winnings (50,000 * 20%) 10,000
Winnings – SM Manila (20,000 * 20%) 4,000
Total Final Taxes 154,000
Case 1
Normal Tax (using Sec. 24 A) 494,800
Final Tax 154,000
Total Income Tax Due 648,800
Case 2
Shares of stocks:
Selling price 1,110,000
Cost (1,000,000)
Capital gain/CGT 110,000 * 15% = 16,500
Real Property:
FMV 3,000,000
CGT rate 6%
CGT 180,000
Total Capital Gains Tax 196,500
Case 3
1st quarter 2nd quarter 3rd quarter Year
Gross sales 1,200,000 2,100,000 3,000,000 3,700,00
Cost of Sales (700,000) (1,200,000) (1,800,000) (2,200,000)
Business Expenses (200,000) (325,000) (550,000) (700,000)
Taxable Income 300,000 575,000 650,000 800,000
Income Tax Due 10,000 73,750 92,500 130,000
Income tax paid
1st quarter (10,000) (10,000) (10,000)
2nd quarter (63,750) (63,750)
3rd quarter (18,750)
Income Tax Payable 10,000 63,750 18,750 37,500
Case 3
Interest Income (29,800 * 20%) 5,960
Dividend Income 20,000
Total Final taxes 25,960
Case 3
Selling Price 400,000
CGT rate 6%
Capital Gains Taxes 24,000
Case 4
Shares of Stock (Kath) [80,000*15%] 12,000
Land (Common) [12,000,000*6%) 720,000
Total Capital Gains Taxes 732,000
Case 4
Kath:
Dividend Income (5,000*10%) 500
Interest Income (2,000*20%) 400
Royalty (1,000*20%) 200
Interest Inc.-Common (3,000*20%) 600
Total Final Tax of Kath 1,700
Niel:
Dividend Income (5,000*10%) 500
Interest Income (3,000*20%) 600
Royalty (1,000*20%) 200
Interest Inc.-Common (3,000*20%) 600
Total Final Tax of Niel 1,900
Case 4
Total Final Tax of Kath 1,700
Total Final Tax of Niel 1,900
Total Final Taxes 3,600
Case 4
Gross Income – Profession 800,000
Dividend Income – RC (12,000/2) 6,000
Interest on N/R (4,000/2) 2,000
Miscellaneous Income (60,000/2) 30,000
Expenses - Common (20,000/2) (10,000)
Expenses (425,000)
Taxable Income 403,000
Case 4
Gross Compensation Income 400,000
Miscellaneous Income 10,000
Dividend Income – RC 6,000
Interest on N/R (4,000/2) 2,000
Miscellaneous Income (60,000/2) 30,000
Expenses - Common (20,000/2) (10,000)
Taxable Income 438,000