Laban lang noh!

Fringe Benefits
 Question # 5a

The monetary value is the entire value of the benefit.

If the fringe benefit is granted in money, or is directly paid for by the

employer, then the value is the amount granted or paid for.
Question # 5b

Value of the Benefit 40,800

Tax Base/GMV (40,800/65%) 62,769

Question # 5c

FBT = Tax Base/GMV x 35% (tax rate)

Fringe Benefit Tax

62,769 x 35%= 21,969
MC #1
MC # 1

ANSWER: C

 It is only limited to managerial or supervisory employees. Rank and file

employees that are given with fringe benefits are not taxable, instead they are
taxable to compensation income subject to normal income tax rates.
MC #1
MC # 2

ANSWER: D

Sec 33 of the National Internal Revenue Code

(a) In pursuant of existing laws, items not taxable to employee but, may be deductible by employer
e.g. SSS, GSIS
(b) The fringe benefit tax is computed only to those granted with managerial and supervisory
positions
( c) convenience of the employer rule
MC #1
MC # 3
ANSWER: A
 MC #1
MC # 4

ANSWER: D

 Choices A to C fall under ‘de minimis” benefits which are exempt from the income tax on
compensation as well as from fringe benefit tax
MC #1
MC # 5

ANSWER: A

 S1: Fringe Benefit Tax is a final income tax to be withheld by

employer.

 S2: Not all types of fringe benefit given to managerial or

supervisory employees are taxable e.g. contribution of the
employer for the benefit of the employee’s retirement.
MC #1
MC # 6

ANSWER: A

 If the fringe benefit is granted or furnished by the employer in property and ownership
is transferred to the employee, then the value of the fringe benefit shall be equal to the
fair market value (“FMV”) of the property
MC #1
MC # 7

ANSWER: A
MC #1
MC # 8

ANSWER: B
**monthly

100,000 (50%)

50,000/65%

76,923 x 35%

Employer leases residential property for use

26, 923 (12) of employee
MC #1
MC # 9
ANSWER: B
MC #1
MC # 10
ANSWER: B
MC #1
MC # 11
ANSWER: B

Zonal value is higher

30M / 65%

46,153,846 x 35%
 MC #1
MC # 12
ANSWER: C

Value of the Benefit 10,000,000

(Zonal Value – Cost to employee)
30,000,000 – 20,000, 000

Monetary Value 10,000,000

Tax Base/GMV 15,384,615

10M/ 65%

FBT 5,384,615
15,384,615 x 35%
MC #1
MC # 13

ANSWER: D

 The fringe benefit is directly connected to the

business operations
 Convenience of the employer rule
MC #1
MC # 14

ANSWER: C
2,000,000 /5 The employer purchased SUV in the name of
employee on an installment basis.

400,000 /65%

615,385 x 35%
MC #1
MC # 15
ANSWER: A
Thank you!