JOHN DELA CRUZ, IS A MIXED INCOME EARNER AND A RESIDENT CITIZEN.

HE IS A SELF-EMPLOYED AND CURRENTLY THE FINANCE MANAGER OF ABC CORPORATION.

THE FOLLOWING DATE WERE PROVIDED FOR 2020 TAXABLE YEAR

COMPENSATION INCOME ₱ 1,800,000.00

SALES ₱ 3,000,000.00
COST OF SALES ₱ 1,125,000.00
BUSINESS EXPENSES ₱ 650,000.00
INTEREST INCOME FROM PESO BANK DEPOSIT ₱ 80,000.00
INTEREST INCOME FRO BANK DEPOSIT UNDER FCDS ₱ 120,000.00
CREDITABLE WITHHOLDING TAX ON COMPENSATION INCOME ₱ 448,000.00
13TH MONTH PAY AND OTHER BENEFITS ₱ 150,000.00
TOTAL GOVERNMENT MANDATORY CONTRIBUTIONS ₱ 89,000.00

EMPLOYED
COMPENSATION INCOME
13TH MONTH PAY AND OTHER BENEFITS
TOTAL GROSS COMPENSATION INCOME
LESS: NON- TAXABLE COMPENSATION
13TH MONTH PAY AND OTHER BENEFITS ₱ 150,000.00
TOTAL TAXABLE COMPENSATION INCOME
LESS: MANDATORY DEDUCTIONS (TAX EXEMPT)
NET TAXABLE COMPENSATION INCOME

AT PHP800,000
IN EXCESS OF PHP800,000 (PHP971,000 X 30%)
TOTAL TAX DUE AS EMPLOYED

SELF-EMPLOYED (GRADUATED RATE)

SALES ₱ 3,000,000.00
COST OF SALES ₱ 1,125,000.00
GROSS INCOME ₱ 1,875,000.00
BUSINESS EXPENSES ₱ 650,000.00
NET INCOME ₱ 1,225,000.00

AT PHP800,000
IN EXCESS OF PHP800,000 (PHP425,000 X 30%)
TOTAL TAX DUE AS SELF-EMPLOYED

TOTAL TAX DUE AS EMPLOYED

TOTAL TAX DUE AS SELF-EMPLOYED
TOTAL INCOME TAX EXPENSE FROM MIXED INCOME EARNER (BASIC INCOME)
TAX DUE AS EMPLOYED
LESS: CREDITABLE WITHHOLDING TAX FROM COMPENSATION
TAX REFUND FROM COMPENSATION
ADD: TAX DUE AS SELF- EMPLOYED
TOTAL TAX LIABILITY FROM MIXED INCOME EARNER (BASIC INCOME)

FINAL TAX
INTEREST INCOME FROM PESO BANK DEPOSIT
MULTIPLY BY: 20% FINAL TAX
FINAL WITHHOLDING TAX

INTEREST INCOME FRO BANK DEPOSIT UNDER FCDS

MULTIPLY BY: 15% FINAL TAX
FINAL WITHHOLDING TAX

TOTAL FINAL TAX

INCOME TAX EXPENSE FROM BASIC INCOME

INCOME TAX EXPENSE FROM PASSIVE INCOME
TOTA INCOME TAX EXPENSE
₱ 1,800,000.00
₱ 150,000.00
₱ 1,950,000.00

₱ 90,000.00 ***THRESHOLD IS PHP90,000

₱ 1,860,000.00
₱ 89,000.00
₱ 1,771,000.00

TAX DUE
₱ 130,000.00
₱ 291,300.00
₱ 421,300.00

THE GROSS SALES IS NOT MORE THAN PHP3,000,000 SO THE TAXPAYER MAY CHOOSE TO
HAVE THE GRADUATED TAX RATE OR 8% TAX RATE IF SIGNIFIES DURING THE 1ST QUARTER FILING OF IT
IF THE PROBLEM IS SILENT THE TAXPAYER OPT THE GRADUATED TAX RATE

BASIS OF TAX DUE

TAX DUE
₱ 130,000.00
₱ 127,500.00
₱ 257,500.00

₱ 421,300.00
₱ 257,500.00
₱ 678,800.00
 ₱ 421,300.00
₱ 448,000.00
-₱ 26,700.00
₱ 257,500.00
₱ 230,800.00

₱ 80,000.00
20%
₱ 16,000.00

₱ 120,000.00
15%
₱ 18,000.00

₱ 34,000.00

₱ 678,800.00
₱ 34,000.00
₱ 712,800.00
AY CHOOSE TO
HE 1ST QUARTER FILING OF ITR
JOHN DELA CRUZ, IS A MIXED INCOME EARNER AND A RESIDENT CITIZEN.
HE IS A SELF-EMPLOYED AND CURRENTLY THE FINANCE MANAGER OF ABC CORPORATION.
HE INTENTIONALLY SIGNIFIES TO OPT 8% TAX RATE UPON FILING TAX RETURN ON THE 1ST QUARTER OF THE YEAR
THE FOLLOWING DATE WERE PROVIDED FOR 2020 TAXABLE YEAR

COMPENSATION INCOME ₱ 1,800,000.00

SALES ₱ 3,000,000.00
COST OF SALES ₱ 1,125,000.00
BUSINESS EXPENSES ₱ 650,000.00
INTEREST INCOME FROM PESO BANK DEPOSIT ₱ 80,000.00
INTEREST INCOME FRO BANK DEPOSIT UNDER FCDS ₱ 120,000.00
CREDITABLE WITHHOLDING TAX ON COMPENSATION INCOME ₱ 448,000.00
13TH MONTH PAY AND OTHER BENEFITS ₱ 150,000.00
TOTAL GOVERNMENT MANDATORY CONTRIBUTIONS ₱ 89,000.00

EMPLOYED
COMPENSATION INCOME
13TH MONTH PAY AND OTHER BENEFITS
TOTAL GROSS COMPENSATION INCOME
LESS: NON- TAXABLE COMPENSATION
13TH MONTH PAY AND OTHER BENEFITS ₱ 150,000.00
TOTAL TAXABLE COMPENSATION INCOME
LESS: MANDATORY DEDUCTIONS (TAX EXEMPT)
NET TAXABLE COMPENSATION INCOME

AT PHP800,000
IN EXCESS OF PHP800,000 (PHP971,000 X 30%)
TOTAL TAX DUE AS EMPLOYED

SELF-EMPLOYED (GRADUATED RATE)

SALES ₱ 3,000,000.00
COST OF SALES ₱ 1,125,000.00
GROSS INCOME ₱ 1,875,000.00
BUSINESS EXPENSES ₱ 650,000.00
NET INCOME ₱ 1,225,000.00

AT PHP800,000
IN EXCESS OF PHP800,000 (PHP425,000 X 30%)
TOTAL TAX DUE AS SELF-EMPLOYED

TOTAL TAX DUE AS EMPLOYED

TOTAL TAX DUE AS SELF-EMPLOYED
TOTAL INCOME TAX EXPENSE FROM MIXED INCOME EARNER (BASIC INCOME)
TAX DUE AS EMPLOYED
LESS: CREDITABLE WITHHOLDING TAX FROM COMPENSATION
TAX REFUND FROM COMPENSATION
ADD: TAX DUE AS SELF- EMPLOYED
TOTAL TAX LIABILITY FROM MIXED INCOME EARNER (BASIC INCOME)

FINAL TAX
INTEREST INCOME FROM PESO BANK DEPOSIT
MULTIPLY BY: 20% FINAL TAX
FINAL WITHHOLDING TAX

INTEREST INCOME FRO BANK DEPOSIT UNDER FCDS

MULTIPLY BY: 15% FINAL TAX
FINAL WITHHOLDING TAX

TOTAL FINAL TAX

INCOME TAX EXPENSE FROM BASIC INCOME

INCOME TAX EXPENSE FROM PASSIVE INCOME
TOTA INCOME TAX EXPENSE
T QUARTER OF THE YEAR

₱ 1,800,000.00
₱ 150,000.00
₱ 1,950,000.00

₱ 90,000.00 ***THRESHOLD IS PHP90,000

₱ 1,860,000.00
₱ 89,000.00
₱ 1,771,000.00

TAX DUE
₱ 130,000.00
₱ 291,300.00
₱ 421,300.00

THE GROSS SALES IS NOT MORE THAN PHP3,000,000 SO THE TAXPAYER MAY CHOOSE TO
HAVE THE GRADUATED TAX RATE OR 8% TAX RATE IF SIGNIFIES DURING THE 1ST QUARTER FILING OF IT
IF THE PROBLEM IS SILENT THE TAXPAYER OPT THE GRADUATED TAX RATE

BASIS OF TAX DUE

TAX DUE
₱ 130,000.00
₱ 127,500.00
₱ 257,500.00

₱ 421,300.00
₱ 257,500.00
₱ 678,800.00
 ₱ 421,300.00
₱ 448,000.00
-₱ 26,700.00
₱ 257,500.00
₱ 230,800.00

₱ 80,000.00
20%
₱ 16,000.00

₱ 120,000.00
15%
₱ 18,000.00

₱ 34,000.00

₱ 678,800.00
₱ 34,000.00
₱ 712,800.00
AY CHOOSE TO
HE 1ST QUARTER FILING OF ITR
MAGANDA, A RESIDENT CITIZEN, DEPOSITED PHP2,000,000 IN THE 180-DAY TIME DEPOSIT OF BANCO DE ORO.
THE DEPOSIT PAYS 8% INTEREST. COMPUTE THE FINAL TAX ON MATURITY OF THE DEPOSIT.

***THIS IS A SHORT TERM INVESTMENT EQUIVALENT TO 180-DAY

***TAXPAYER IS A RESIDENT CITIZEN

PRINCIPAL AMOUNT OF INVESTMENT 2,000,000

MULTIPLY BY INTEREST RATE 8%
TOTAL ANNUAL INTEREST 160,000
MULTIPLY BY (180 DAYS/360 DAYS) 0.5
INTEREST FOR 180-DAY 80,000
MULTIPLY BY FINAL TAX RATE 20%
FINAL TAX 16,000

MAGANDA, A NON-RESIDENT ALIEN NOT ENGAGED IN TRADE OR BUSINESS, DEPOSITED PHP2,000,000 IN THE 180-DAY TIME D
THE DEPOSIT PAYS 8% INTEREST. COMPUTE THE FINAL TAX ON MATURITY OF THE DEPOSIT.

***THIS IS A SHORT TERM INVESTMENT EQUIVALENT TO 180-DAY

***TAXPAYER IS A NON-RESIDENT ALIEN NOT ENGAGED IN TRADE OR BUSINESS

PRINCIPAL AMOUNT OF INVESTMENT 2,000,000

MULTIPLY BY INTEREST RATE 8%
TOTAL ANNUAL INTEREST 160,000
MULTIPLY BY (180 DAYS/360 DAYS) 0.5
INTEREST FOR 180-DAY 80,000
MULTIPLY BY FINAL TAX RATE 25%
FINAL TAX 20,000

BINIBINI, RESIDENT ALIEN, DEPOSITED $1,000,000 IN A DEPOSITARY BANK UNDER THE EXPANDED FOREIGN CURRENCY DEPOS
THE FIVE-YEAR SAVINGS DEPOSIT PAYS 10% ANNUAL INTEREST.
ASSUMING A PHP45:$1 EXCHANGE RATE, HOW MUCH FINAL TAX ON INTEREST WOULD BE WITHHELD IN THE FIRST YEAR?

***THIS IS A SHORT TERM INVESTMENT EQUIVALENT TO 180-DAY

***TAXPAYER IS A NON-RESIDENT ALIEN NOT ENGAGED IN TRADE OR BUSINESS

PRINCIPAL AMOUNT OF INVESTMENT (USD) 1,000,000

MULTIPLY BY PHP45 EXCHANGE RATE 45
PRINCIPAL AMOUNT OF INVESTMENT (PHP) 45,000,000
MULTIPLY BY INTEREST RATE 10%
TOTAL ANNUAL INTEREST 4,500,000
MULTIPLY BY FINAL TAX RATE 15%
FINAL TAX 675,000
ERIC RECEIVED PHP42,000 INTEREST FROM SHORT-TERM DEPOSITS. COMPUTE THE FINAL TAX WITHHELD ON THE INTEREST.

***INTEREST RECEIVED IS ALREADY NET OF FINAL WITHHOLDING TAX

***TAXPAYER IS ASSUMED AS RESIDENT CITIZEN

INTEREST (NET OF FINAL WITHHOLDING TAX OF 20%) 42,000

DIVIDED BY (1-20%) 80%
INTEREST (GROSS) 52,500
MULTIPLY BY FINAL TAX RATE 20%
FINAL TAX 10,500

ON JANUARY 2, 2020, MR. TAMAYO INVESTED PHP2,000,000 IN THE SIX-YEAR TIME DEPOSIT OF BANCO DE ORO WHICH PAYS
COMPUTE THE FINAL TAX TO BE WITHHELD BY BANCO DE ORO ON DECEMBER 31, 2020.

THIS IS TAX EXEMPT BECAUSE THE INVESTMENT IS LONG TERM

MR. MAKATA PUBLISHED HIS BOOK ABROAD FOR THE INTERNATIONAL MARKET.
DURING THE FIRST QUARTER, HE EARNED A GROSS ROYALTY OF PHP1,000,000.
HOW MUCH IS THE FINAL TAX WILL BE WITHHELD BY THE FOREIGN PUBLISHER?

THE ANSWER IS ZERO BECAUSE THE QUESTION IS TAX TO BE WITHHELD BY THE FOREIGN PUBLISHER
THE FULL AMOUNT WILL BE RECEIVED BY MR. MAKATA AND WILL BE SUBJECT TO NORMAL TAX NOT FINAL TAX

RULE: ROYALTY INCOME EARNED OUTSIDE THE PHILIPPINES SHALL BE SUBJECT TO NORMAL TAX IF EARNED BY A RESIDENT

MR. ABUNDA WON AN PHP800,000 PRIZE IN A NATIONAL DANCING COMPETITION. THE ORGANIZER OF THE EVENT DECLARED
THAT THE PHP800,000 GRAND PRIZE WAS "TAX FREE". HOW MUCH FINAL TAX MUST BE REMMITTED BY THE ORGANIZER TO T

***PRIZES RECEIVED IS ALREADY NET OF FINAL WITHHOLDING TAX

***TAXPAYER IS ASSUMED AS RESIDENT CITIZEN

PRIZES (NET OF FINAL WITHHOLDING TAX OF 20%) 800,000

DIVIDED BY (1-20%) 80%
PRIZES (GROSS) 1,000,000
MULTIPLY BY FINAL TAX RATE 20%
FINAL TAX 200,000

MS. SPORTY WON A GOLD MEDAL AND PHP50,000 CASH PRIZE FRO CHESS COMPETITION IN THE PALARONG PAMBANSA.
HOW MUCH FINAL TAX SHOULD BE WITHHELD FROM THE PRIZE?
 TAX EXEMPT BECAUSE IT IS FOR PALARONG PAMBANSA

MR. CONDRADO WON THE 50,000,000 OF 6/49 SUPERLOTTO JACKPOT OF THE PHILIPPINE CHARITY SWEEPSTAKES OFFICE. HO

WINNINGS 50,000,000
MULTIPLY BY FINAL TAX RATE 20%
FINAL TAX 10,000,000
 IN THE 180-DAY TIME DEPOSIT OF BANCO DE ORO.

REIGN CURRENCY DEPOSIT SYSTEM.

IN THE FIRST YEAR?

ELD ON THE INTEREST.

O DE ORO WHICH PAYS 10% ANNUAL INTEREST.

OT FINAL TAX

EARNED BY A RESIDENT CITIZEN AND DOMESTIC CORPORATION, OTHERWISE, NOT SUBJECT TO TAX. ​

OF THE EVENT DECLARED

BY THE ORGANIZER TO THE BIR?

RONG PAMBANSA.
WEEPSTAKES OFFICE. HOW MUCH FINAL TAX WILL BE WITHHELD?