TAXATION

INSTRUCTIONS: Select the best answer for each of the following questions. ALL questions are compulsory and
MUST be attempted. Mark only one answer for each item on the answer sheet provided. Strictly NO ERASURES
ALLOWED. Erasures will render your examination answer sheet INVALID. Use PENCIL NO. 2 only. GOODLUCK!

1. The Congress, after much public hearing and 5. Situs of taxation is world/global taxation
consultations with various sectors of society, came to A. B. C. D.
the conclusion that it will be good for the country to Resident citizen True True True False
have only one system of taxation by centralizing the Nonresident True True False False
imposition and collection of all taxes in the national citizen
government. Accordingly, passed law that would OCWs True True False False
abolish the taxing power of all local government units. Special Filipino True True True False
Would such a law be valid under the present employee
Constitution? Resident alien True False False False
I. Yes, the law centralizing the imposition and
Nonresident alien True False False False
collection of all taxes in the national government
Special alien True False False False
would not contravene the Constitution as long as a
employee
new law is enacted for the common good of the
people.
II. No because under the present Constitution, each 6. Determine the correct classification of the following:
local government unit shall have the power to I. Manny, a Filipino businessman, went on a business
create their own sources of revenue and to levy trip abroad and stayed there most of the time
taxes, fees, and charges subject to such guidelines during the year.
and limitations as Congress may provide consistent II. Kyla, a Filipino professional singer, held a series of
with the basic policy of local autonomy. concerts in various countries around the world
during the current taxable year. She stayed abroad
III. No. It is clear that Congress can only give the
most of the time during the year.
guidelines and limitations on the exercise by the
III. Efren, a Filipino cue artist who went to Canada
local governments of the power to tax but what
during the taxable year to train and participate in
was granted by the fundamental law cannot be
the world cup of pool. He stayed therein most of
withdrawn by Congress.
the time during the year.
a. I only c. I, II and III
b. II and III only d. None of the above A. B. C. D.
I NRC RC RC RC
2. Statement 1: Income tax collected from the taxpayers II NRC NRC RC RC
is the main source of revenue of the local government. III NRC NRC NRC RC
Statement 2: Taxes collected are the main source of
revenue of the government. 7. LJ, married, left the Philippines in the middle of the
A. B. C. D. year on July 1, 2015 to go abroad and work there for
Statement1: True True False False five (5) years. The following data were provided as of
Statement2: True False True False December 31,2015:
Gross Business Business Expenses
3. Which of the following statements is true? PERIOD Income
a. The power of taxation and eminent domain are Phls. Abroad Phls. Abroad
both exercisable only by the government and its Jan. 1 to P300,000 P200,000 P100,000 P50,000
political subdivision. June 30
b. In police power, the property taken is preserved for July 1 to 600,000 400,000 150,000 50,000
public use. Dec. 31
c. The power of eminent domain is created by the
constitution. His taxable income is:
d. The exercise of the power of eminent domain and a. P750,000 c. P1,100,000
police power can be expressly delegated to the b. P950,000 d. P600,000
local government units by the law making body.
8. Vincent sold his principal residence for P10,000,000 to
4. Under the Final Withholding Tax system, which of the his friend. Its FMV when he inherited it from his father
following statements is not correct? was P12,000,000 although its present FMV is
a. Income tax withheld by the withholding agent is P15,000,000. He used of the proceeds to buy a new
constituted as a full and final payment of the principal residence within eighteen (18) months after
income tax due from the payee on the said the sale. Assume further that Vincent properly
income. informed the BIR about the sale within the required
b. The liability for payment of the tax rests primarily period. It shall be:
on the payee as a recipient of income. a. Exempt from capital gains tax
c. In case of failure to withhold the tax, the deficiency b. Subject to P300,000 capital gains tax
tax shall be collected from the withholding agent. c. Subject to P450,000 capital gains tax
d. The payee is no longer required to file an income d. Subject to P600,000 capital gains tax
tax return for the particular income.

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9. Mr. Almansor Sebastian, an Arabian and a resident of 12. Assuming the taxpayer is a Special Filipino Employee,
Saudi Arabia, requested you to determine his taxable his total combined taxes on all income from the
income tax for 2015. His gross income in the Philippines is:
Philippines is composed of P400,000 interest income a. P380,500 c. P595,000
from various peso bank deposits, P200,000 FCDS bank b. P304,000 d. P446,500
deposits, P100,000 dividend income from domestic
corporations and PCSO winnings of amounting to 13. Mike Ong received P100,000 winnings from
P500,000. The total income subject to tax in the cockfighting. Determine his tax liability.
Philippines is I. Subject to 10% OPT (tax on winnings) under
a. P0 c. P1,000,000 Section 126 of the Tax Code
b. P1,000,000 d. P1,200,000 II. Subject to basic income tax
III. Subject to 20% final tax on passive income
10. Ms. Ganda Mee, a resident citizen with four (4) IV. Subject to 10% OPT (tax on winnings) under
qualified dependent illegitimate children living with and Section 126 of the Tax Code and 20% final tax on
dependent also for her chief support provided the passive income
following data for the year: a. I only c. III only
Compensation income as a Secretary P375,000 b. II only d. I and III
to the President of MVUS Corporation
(net of P125,000 withholding tax) 14. Mike Ong received P100,000 winnings from
Mid-year bonus and 13th month pay 60,000 horseracing. Determine his tax liability.
Rental income from condominium units 228,000 I. Subject to 10% OPT (tax on winnings) under
in Ortigas(net of withholding tax) Section 126 of the Tax Code
Income as a professional singer in an 229,500 II. Subject to basic income tax
international hotel in Makati (net of III. Subject to 20% final tax on passive income
creditable withholding tax) IV. Subject to 10% OPT (tax on winnings) under
Income from talent fees paid by TV 955,000 Section 126 of the Tax Code and 20% final tax on
Shows as regular host passive income
(gross amount however the creditable a. I only c. III only
tax was already remitted) b. II only d. I and III
Interest income from deposits in 50,000
domestic bank 15. A Joint Account is constituted when one interests
Royalty income from pocketbooks 300,000 himself in the business of another by/and
published I. Contributing capital thereto.
II. Sharing in the profits or losses in the proportion
During the year, two of her children became agreed upon.
III. They are not subject to any formality.
gainfully employed, one got married at the age of IV. It may be privately contracted orally or in writing.
19 and the eldest reached the age of 21. Determine a. I and II only c. I, II, III and IV
the correct amount of basic tax and final tax on b. I, II and III only d. None of the above
passive income
16. Statement 1: The share of a co-venturer individual in
A. B. C. D.
the net income of a tax-exempt joint venture or
Basic Tax P235,250 P235,250 P283,000 P283,000 consortium is subject to normal income tax under
Final Tax P40,000 P70,000 P40,000 P70,000 Section 24A of the tax code.
Statement 2: The share of a co-venturer individual in
Use the following data for the next three (3) questions the net income of a tax-exempt joint venture or
Hajib, a Russian national who is an employee in the consortium is subject to creditable withholding tax of
regional area headquarter of a multinational corporation, 20%.
occupying managerial position, had the following data a. Only statement 1 is correct
for taxable year 2015: b. Only statement 2 is correct
Salaries received P600,000 c. Both statements are correct
Allowances and honoraria 50,000 d. Both statements are incorrect
Other emoluments 100,000
Monetary value of fringe benefits subject to 170,000 17. The following information were taken from the records
fringe benefit tax of NFJPIA Inc., a domestic corporation already in its
De minimis benefits (within the ceiling) 50,000 fifth year of operation:
Dividend income from a domestic corporation 40,000 Gross profit from sales P3,100,000
Interest income from peso bank deposit 50,000 Capital gain on sale directly to 100,000
Interest income from foreign currency deposit 20,000 buyer of shares in a domestic
under FCDS corporation
PCSO winnings (gross) 1,000,000 Dividend from:
Raffle draw winnings 80,000 Domestic corporation 20,000
Gain from sale of shares of a domestic Resident foreign corporation 10,000
corporation sold directly to a buyer 150,000 Interest on: 20,000
Gain from sale of a vacant lot in Quezon City 500,000 Bank deposit
held as investment Trade receivable 50,000
(SP=P2,500,000; Cost=P2,000,000; Zonal Business expenses 2,100,000
Value=P2,500,000) Income tax withheld 115,000
Quarterly income tax payments 160,000
11. The total income tax expense of Hajib in the Income tax payable prior year (10,000)
Philippines is:
a. P535,000 c. P570,000
b. P565,000 d. P315,000

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The income tax due at the end of the year: 22. An offshore banking unit, already in its 8 th year in the
a. P318,000 c. P43,000 Philippines, has the following data in its income and
b. P63,200 d. P33,000 expenses for the year 2015:
Foreign currency transactions
Next two (2) questions are based on the following: with:
Be Jolly Corporation has the following information for the Non-residents 1,800,000
taxable year 2015: Local banks 1,200,000
Branches of foreign banks 1,000,000
QUARTER RCIT MCIT Creditable Another OBU 500,000
Withholding Other residents (Interest 800,000
Tax Income)
First 200,000 160,000 40,000
Second 240,000 500,000 60,000 Other income:
Third 500,000 150,000 80,000 Rent income 1,000,000
Fourth 300,000 200,000 70,000 Miscellaneous income 500,000

Additional Information: Operating Expenses 2,380,000

a) MCIT carry-over amounts to P60,000;
b) Excess tax credits from prior year amounts to How much is the total income tax for the year?
P20,000. a. P80,000 c. P372,500
b. P292,500 d. P0
18. How much was the income tax payable for the second
quarter? Use the following data for the next two questions:
a. P660,000 c. P200,000 Bobadilla Uro Partnership is a general professional
b. P460,00 d. P160,000
partnership, with Bobadilla, married, and Uro,
19. Using the same data except that the MCIT on the 4 th single, participating equally in the income and
Quarter is P500,000, how much was the annual income expenses. The following are the data for the
tax payable? partnership and the partners in a calendar year:
a. P330,000 c. P380,000 BU Uro Bobadilla
b. P1,310,000 d. P360,000 Partnership
Gross
20. JC Corporation, a domestic corporation had the Income P600,000 P150,000 P200,000
following data for 2015: Expenses 350,000 70,000 120,000
Sales P5,000,000
Cost of goods sold 2,000,000 NOTE: Uro uses his personal car in going to meetings
General selling and administrative 500,000 with client. He was able to determine that the allocated
expenses depreciation and gasoline expense to such meetings is
Interest income from Philippine bank 100,000 P35,000. The said amount was not included in the
deposit expenses claimed by the partnership.
Rental income (net of 5% withholding 190,000
tax) 23. The taxable income of Uro is
Dividend Income: a. P220,000 c. P155,000
From domestic corporation 60,000 b. P120,000 d. P30,000
From foreign corporation 50,000
Capital gains from sale of domestic 24. The taxable income of Uro if the Partnership is engage
shares of stocks sold Directly to 75,000 in trade or business is:
buyer a. P220,000 c. P155,000
Dividend declared and paid during the 500,000 b. P120,000 d. P30,000
year
Retained earnings, 12/31/2014 1,000,000 25. The taxable income of Uro if the Partnership opted to
Par Value of outstanding shares, 500,000 use Optional Standard Deduction is:
12/31/2015 a. P220,000 c. P155,000
Appropriation for future plant 800,000 b. P120,000 d. P30,000
expansion
Use the following data for the next two (2) questions:
The Improperly accumulated earnings tax was: A resident alien had the following data in 2014:
a. P208,125 c. P213,625 Gross income, Philippines P2,000,000
b. P108,125 d. P105,125 Business expenses 1,200,000

21. Offshore Banking Units (OBUs) are tax exempt on Dividends received:
income derived from From domestic corporation (net)
I. Foreign currency transactions with local 60% of its income came from 90,000
commercial banks. the Philippines
II. Foreign currency transactions with branches of 40% of its income came from 72,000
foreign banks authorized by BSP. the Philippines
III. Interest income derived from foreign currency From resident foreign corporation
loans granted to other residents. (gross)
a. I only c. I and II only 60% of its income came from 50,000
b. II only d. II and III only the Philippines
40% of its income came from 40,000
the Philippines

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b. P112,500, P67,500 and P45,000, respectively

c. P225,000, P0 and P0, respectively
26. The taxpayers taxable income is d. None of the choices
a. P750,000 c. P796,000
b. P780,000 d. P800,000 32. Juan received as gift from his mother property
purchased ten years ago for P100,000. At the time of
27. Lenovo, Inc., a resident foreign corporation, has donation, the property had a fair market value of
earned the following income during the taxable year: P2,000,000. After owning the property for 3 years,
DIVIDEND INCOME FROM: Juan sold them for P2,500,000. Which of the following
Microsoft, a non-resident foreign P 500,000 statements is correct?
corporation a. The gain on the sale was a capital gain of
Intel, a resident foreign 400,000 P2,400,000.
corporation (ratio of Philippine b. The gain on the sale was an ordinary gain of
income over world income for the P2,400,000.
past 3 years is 40%)
Panday, a domestic corporation 300,000 c. The holding period of the asset is immaterial
INTEREST INCOME FROM: d. The gain on the sale going into the net taxable
Current account, BDO 600,000 income was P2,400,000.
Savings deposit, ABN-AMRO 700,000
33. Mr. Mapagbigay had the following data during the year:
bank, UK
Gross income from business P1,000,000
FCDU deposits 800,000
Compensation income 40,000
ROYALTY INCOME from various 100,000 Long-term Capital gain 50,000
domestic corporations Short-term Capital loss 20,000
Operating expenses 400,000
The total final tax on passive income for the taxable Donation to an accredited 30,000
year is: NGO
a. P200,000 c. P230,000 Donation to church 40,000
b. P1,088,000 d. P328,000
How much is the taxable income?
28. Which of the following test of source of income is a. P505,000 c. P535,000
incorrect? b. P525,000 d. P555,000
a. Interest income - residence of the debtor
b. Income from services place of performance 34. Based on the above problem, but the taxpayer is a
c. Royalties place of use of intangible corporation, how much is the taxable income?
d. Gain on sale of real property place of sale. a. P570,000 c. P560,000
b. P545,000 d. P600,000
29. Situs of taxation on income from sale shares of a
domestic corporation. 35. BSE College, a proprietary educational institution,
a. Always treated as income derived from within the spent P10 million for the construction of a new school
Philippines building. The amount spent for the construction -
b. Always treated as income derived from without the a. Must be claimed as expense in the year of
Philippines completion
c. May be treated as income within or without the b. Capitalized and claim annual depreciation over the
Philippines depending on the place of sale life of the building
d. May be treated as income within or without the c. Capitalized or expensed outright at the option of
Philippines depending where the shares are kept the school
d. Capitalized or expensed outright at the option of
30. Situs of taxation on income from sale shares of a the BIR
foreign corporation.
a. Always treated as income derived from within the Use the following data for the next two (2) questions:
Philippines Floyd, not a dealer in securities, had the following
b. Always treated as income derived from without the transactions on ordinary shares of JJ Co. (a domestic
Philippines corporation) for 2015 taxable year:
c. May be treated as income within or without the Jan. 12 Purchase 100 shares P100,000
Philippines depending on the place of sale June 20 Sold the shares purchased on 80,000
d. May be treated as income within or without the Jan. 12
Philippines depending where the shares are kept June 30 Purchased 70 shares 50,000
Oct. 15 Sold the shares purchase on 75,000
31. Joseph provided the following data on sale of his June 30
personal property sold in 2013 held by him for 15
months: 36. How much was the loss on wash sale?
Cost P225,00 a. P20,000 c. P14,000
0 b. P6,000 d. P0
Mortgage assumed by the buyer 270,000
Installment Collection Schedule: 37. How much was the capital gain on sale of shares on
- 2013 67,500 October 15?
- 2014 67,500 a. P25,000 c. P5,500
- 2015 45,000 b. P11,000 d. P0

How much is the income subject to income tax in 38. Which of the following is subject to 3% percentage tax
2013, 2014, and 2015? under Section 116 of the Tax Code?
a. P56,250, P33,750 and P22,500, respectively

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I. Fruit dealer whose gross receipts for the year b. The P50,000 gain is subject to 5% capital gains tax
amounted to P1,200,000 only. c. The P150,000 selling price is subject to stock
II. An individual taxpayer whose gross sales for the transaction tax of of 1%.
year amounted to P100,000. d. The sale is exempt from business tax
III. School bus operator whose gross receipts for the
year amounted to P1,919,500 45. In 2015, ADB Finance purchased debt securities from
a. I and II only c. All of the above various companies (listed) for P100,000. ADB
b. I and III only d. None of the above classified the securities as Trading Securities/FAFVPL
under the applicable accounting standards. ADB
39. The taxpayer is a trader of poultry feeds. Determine received interest income from those securities
his applicable business tax. amounting to P20,000. Determine the applicable tax.
a. Subject to 12% vat a. The P20,000 interest income is subject to normal
b. Vat exempt but subject to 3% OPT under Section corporate tax of 30%
116 b. The P20,000 interest income is subject to 20%
c. 12% vat or 3% OPT, at his option final tax
d. Exempt from 12% vat and OPT c. The P20,000 interest income is subject to 5%
capital gains tax
40. In the case of a person whose VAT registration is d. The P20,000 interest income is tax exempt
cancelled and who becomes liable to the 3% tax on
VAT-exempt persons under Section 116 of the tax 46. JJ wants to procure marine insurance for his vessels
code, the tax shall accrue from the date of cancellation from International Aquatic Insurance Co., a non-
and shall he paid within: resident foreign corporation, through its agent, in the
a. 10 days after the end of each taxable month Philippines. He paid premiums in 2016 amounting to
b. 15 days after the end of each taxable month P5 million. How much is the premiums tax payable on
c. 20 days after the end of each taxable month the transaction?
d. 30 days after the end of each taxable month a. P500,000 c. P200,000
b. P250,000 d. nil
41. Which one of the following percentage taxes is paid on
a quarterly basis? 47. Bulwagan ng Katotohana, radio and television
I. Tax on overseas dispatch, message, or broadcasting franchisee, recorded the following gross
conversation originating from the Philippines receipts and expenses during the taxable year:
II. Amusement taxes and taxes on winnings Advertising revenue from:
III. Stock transactions tax Television division P20,000,000
IV. Percentage tax on international carriers Radio division 5,000,000
a. I and II only c. I, II and III only Donation received for calamity 5,000,000
b. III and IV only d. I, II, III and IV victims
Expenses:
42. In 2015, ADB Finance (domestic corporation) Salary 8,000,000
purchased various equity securities from listed Other Operating expenses, 7,840,000
domestic corporations for P100,000. ADB classified including VAT
the securities as Trading Securities/FAFVPL under the
applicable accounting standards. ADB received What is the amount of business tax advantages
P10,000 dividend income from such investments in (disadvantages) if AB-GMS is VAT-registered?
2016.. Determine the applicable tax of ADB. a. P840,000
a. The P10,000 dividend income is subject to normal b. P1,699,200
corporate tax of 30% c. (P2,250,000)
b. The P10,000 dividend income is subject to a final d. (P1,410,000)
withholding tax of 10%
c. The P10,000 dividend income is subject to a final 48. Statement 1: International air carriers and
withholding tax of 20% international shipping carriers shall not be subject to
d. The dividend income is tax exempt 12% value added tax but to 3% common carriers tax
based on gross receipts derived from their transport of
43. In 2015, ADB Finance (domestic corporation) passengers and goods from Philippines to other
purchased various equity securities from listed countries.
domestic corporations for P100,000. ADB classified Statement 2: In cases when the Gross Philippines
the securities as Trading Securities/FAFVPL under the Billings Tax of 2.5% for international carriers is not
applicable accounting standards. ADB sold the shares applicable (i.e., tax exempt based on reciprocity or
in 2016 for P150,000. Determine the applicable tax. treaty), the common carriers tax under Section 118 of
a. The P50,000 gain is subject to normal corporate the NIRC, as amended, shall still apply.
tax of 30% A. B. C. D.
b. The P50,000 gain is subject to 5% capital gains tax Statement 1 True True False False
c. The P150,000 selling price is subject to stock Statement 2 True False True False
transaction tax of of 1%.
d. The sale is exempt from business tax
49. Farmers products (FP) is a buyer and miller of
agricultural products. During the first quarter, its
44. In 2015, ADB Finance purchased equity securities from
transactions are recorded as follows:
ABC Corporation (non-listed) for P100,000. ADB
Units Cost/kg.
classified the securities as Available for Sale
Purchase of palay 500,000kg 15
Securities/FAFVOCI under the applicable accounting
Purchase of corn 200,000kg 8
standards. ADB sold the shares in 2016 for P150,000.
Milling of palay of 4,000,000k 2
Determine the applicable tax.
customers g
a. The P50,000 gain is subject to normal corporate
Milling corns of customer 3,000,000k 2
tax of 30%

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g Purchases of Corn & Coconut 330,000

Corn & Coconut, 1-31-13 20,000
FP milled its purchase for productions of rice and corn Purchases from VAT suppliers, VAT
grits with an output of 80% and sold the products to included:
various retailers for P30 per kilo of palay and P20 per Packaging Materials 56,000
kilo of corn grits. Supplies 16,800

How much is the VAT payable of FP during the quarter? The value-added tax payable for the month:
a. P1,680,000 c. P384,000 a. P56,060 c. P60,650
b. P1,440,000 d. P0 b. P54,900 d. P63,000

50. Farmers foods services (FFS) is an agricultural 54. Sweet Tooth Inc. is a manufacturer of sugar. It has the
contract grower. During the first quarter, its following data for the year 2013 (assume that amount
transactions are recorded as follows: is net of VAT unless otherwise stated):
Service rendered production Fee per pdn
units Sales from Raw Sugar P4,000,00
Hatching and sorting 1,600,000 10/tray 0
of eggs trays Sales from Refined Sugar 6,000,000
Dressing and packing 1,200,000 20/pack Sugar Cane Inventory, 12-31-12 1,500,000
broilers packs Purchases of Sugar Cane 7,000,000
Reforestation with 1,000,000 5/tree Sugar Cane Inventory, 12-31-13 2,500,000
government program trees Purchases from VAT suppliers, 672,000
gross of VAT
FFS conducts production 30 days in a month because How much is the VAT payable?
of the demand of the service. It also runs a canteen for a. P396,800 c. P368,000
its workers and passers-by. The canteen has a total b. P508,800 d. P480,000
sales of P50,000 a day.
Use the following data for the next three questions:
How much is the VAT payables of FFS during the A VAT-registered trader has the following transactions:
quarter? Sales of good to private entities, net of P2,500,000
a. P600,000 c. P135,000 VAT
b. P540,000 d. P0 Purchases of goods sold to private 896,000
entities, gross of 12% VAT
51. Determine the business taxes of the following: Sales to a government owned 1,000,000
I. Lease of residential units with a monthly rental per corporation (GOCC), net of VAT
unit not exceeding P12,800 (regardless aggregate Purchases of goods sold to GOCC, net 700,000
annual gross rentals). of 12% VAT
II. Lease of residential units with a monthly rental per
unit exceeding P12,800 but the aggregate of such 55. How much is the creditable input tax?
rentals of during the year do not exceed a. P166,000 c. P70,000
P1,919,500. b. P96,000 d. P180,000
III. Lease of commercial units regardless of monthly
rental per unit. 56. How much is the input tax closed to expense
A B C D (income)?
I None None None Vat a. P14,000 c. (P14,000)
II OPT OPT OPT Vat b. P34,000 d. (P34,000)
III Vat OPT Vat Vat
57. How much is the VAT payable to the BIR?
52. CG Corporation is a vat registered entity with the a. P404,000 c. P204,000
following data for a taxable month: b. P390,000 d. nil
Domestic sales P500,000
Transaction deemed sales 500,000 58. JJ gave gifts to the following persons on his 40th
Export sales 500,000 birthday:
Sales to DEF, an export oriented 500,000 A second hand car worth P350,000 to Kaskasero,
enterprises his trusted driver. The donation was made orally.
(2/3 of DEFs annual output is actually Since then, the driver had taken possession of the
exported) property.
Purchases (invoice cost from vat 224,000 To his Mayordoma, Ms. Mercy, a lot with a
registered entities) bungalow thereon, The value of the property is
Purchases (invoice cost from non-vat 100,000 P1,200,000. The donation provides that it may be
registered entities) revoked anytime at the pleasure of JJ.
His flower shop worth P700,000 to Hardinero, his
The vat payable of CG should be gardener. The donation is provided in his will.
a. P216,000 c. P156,000 Cash of P50,000 each to his three closest friends.
b. P204,000 d. P96,000
How much is the donor's tax due on the above
53. Mantika Corp., a VAT-registered Corp., is a producer of donations?
cooking oil from coconut and corn. It had the following a. P720,000 c. P100,000
data for the month of January 2014: b. P45,000 d. P1,000
Sales, gross of VAT P784,00
0 59. Amanda Raya sold her properties to her son on the
Corn & Coconut, 12-31-12 50,000 following prices:

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Residential house for P100,000 Transfer passing under special power of 75,000
Personal properties for P50,000 appointment
Deductions claimed:
The current fair market value on the date of sale was Funeral expenses 575,000
P1,000,000 for the house, and P500,000 for the Judicial expenses 67,500
personal properties. Assuming that you know the facts Donation mortis causa to Quezon City 150,000
as a BIR officer, the correct total tax payable on the government
transaction is Unpaid mortgage on the farm lot 75,000
Medical expenses (included in the 225,000
a. P12,000 c. None funeral expenses incurred within the 1
b. P72,000 d. P38,000 year period with receipts)
The farm lot was inherited 5 years by the decedent
60. The spouses Esme and Carlisle wanted to donate a before his death with a value then of P575,000 and a
parcel of land to their son Edward who is getting mortgage indebtedness of P150,000.
married in December, 2014. The parcel of land has a
zonal valuation of P420,000.00. What is the most The taxable net estate is:
efficient mode of donating the property? a. P3,757,500 c. P2,757,500
a. The spouses should first donate in 2014 a portion b. P4,982,500 d. P2,672,329
of the property valued at P20,000, then spread
the P400,000 equally for 2015, 2016, 2017 and 64. Jiraiya, non-resident Japanese, died leaving the
2018. following:
b. Spread the donation over a period of 5 years by Exclusive properties, Philippines P560,000
the spouses donating P100,000 each year from Conjugal properties, Philippines 420,000
2014 to 2018. Conjugal properties, Abroad 1,820,000
c. The spouses should each donate a P110,000 Funeral expenses 100,000
portion of the value of the property in 2014 then Judicial expenses 100,500
each should donate P100,000 in 2015. Unpaid expenses 150,500
d. The spouses should each donate a P100,000 Losses: occurring 3 mos. After death 120,000
portion of the value of the property in 2014, and due to fire
another P100,000 each in 2015. Then, in 2016, Donation mortis causa to Makati City 180,000
Esme should donate the remaining P20,000. Hall
Family Home (inc. above), located 1,000,000
61. On July 18, 2014, Mr. Dela Cruz gave a property with a abroad
fair market value of P550,000 to Lester, a legitimate Standard deduction 1,000,000
son, and Jennifer, Lesters bride, on account of their The taxable net estate is:
marriage celebrated on July 19, 2013. The donors tax a. P516,500 c. P1,900,000
payable is: b. P635,150 d. P2,100,000
a. P87,100 c. P84,100
b. P38,000 d. P15,800 65. Expenses not essential in the proper settlement of the
estate but incurred for the individual benefit of the
62. During the current year, Mr. and Mrs. Cabarles, non- heirs, legatees, or devisees are not allowed as judicial
resident citizens, donated the following: expenses. Which of the following is not allowed as
Sept. 25: To Leona, a legitimate child, on account of deduction from the gross estate under this category?
marriage last month, a conjugal property I. Attorney's fees paid by the heirs to their respective
located in the Philippines, FMV, P620,000. lawyers arising from conflicting claims are not
deductible as judicial expenses.
To Leo, nephew of Mr. Cabarles, on account II. Premiums paid by a judicial administrator on his
of marriage, a property located in USA bond.
exclusively owned by him with fair market III. Compensation of trustees
value of P150,000 (gift tax in USA, P a. I only c. I and II only
5,500) b. II only d. I, II and III

Oct. 9 : To Leonor, a legitimate child, conjugal The next two (2) questions are based on the data provided
property in the Philippines with fair market below:
value of P100,000. Mr. J. Chavez died leaving the following properties:
Rest house in Cebu, acquired before 6,000,000
The gift tax payable on the October 9 gift of the marriage
husband is: Income from rest house in Cebu 600,000
a. P14,000 c. P500 Condominium in Davao, brought to 3,600,000
b. P1,800 d. P4,200 marriage by wife
Income from condominium in Davao 360,000
63. Mr. Nakalimot Huminga, head of family died on January Town house in Quezon City, acquired 10,500,000
15, 2013, leaving the following properties and during marriage
obligations: Income from town house in Quezon City 1,050,000
Cash in bank, 50%, donated mortis P300,000 Car, inherited by wife during marriage 1,300,000
causa to Natl Govt;50-% to Q.C. (the testator provided in his Will that it
govt shall form part of the common properties
House and lot in Makati, F. Home 1,500,000 of the spouses)
Personal properties 1,500,000 Jewelry, acquired during marriage for 200,000
Farm lot 825,000 exclusive use of the wife
Claim against an insolvent debtor 225,000
Transfer in contemplation of death 1,500,000 66. How much is the conjugal properties under Conjugal
(gratuitous) Partnership of Gains?

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TeamPRTC

a. P12,510,000 c. P18,510,000
b. P22,310,000 d. P23,610,000

67. How much is the community properties under Absolute

Community of Property? 70. A taxpayer disclosed to you the following information:
a. P12,510,000 c. P18,510,000 Date of filing the Income Tax Mar. 28, 2012
b. P22,310,000 d. P23,610,000 Return:
Date assessment was June 20, 2014
68. Marcelina filed her 2013 Income Tax Return and paid received:
the tax due thereon on April 1, 2014. The last day for Request for reinvestigation July 4, 2014
the Bureau of Internal Revenue to send an assessment was filed:
is Assuming the taxpayer submitted the documents
a. April 1, 2017 c. April 15, 2017 supporting his motion on August 26, 2014. The Bureau
b. April 15, 2019 d. April 15, 2024 of Internal Revenue should act on the protest not later
than
69. Apolonio filed his Income Tax Return (ITR) for taxable a. September 26, 2014
year 2013 on May 2, 2014. After an investigation, it b. April 15, 2015
was discovered that the tax paid was deficient. The last c. February 26, 2014
day for the BIR to send an assessment: d. February 22, 2015
a. April 15, 2017 c. May 2, 2016
b. May 2, 2017 d. April 15, 2016 ***End of Mock Board Exam***

DONORS TAX TABLE

Over But not over The tax shall be Plus Of the excess over

- P100T Exempt
P100T 200T 0 2% P100T
200T 500T 2,000 4% 200T
500T 1M 14,000 6% 500T
1M 3M 44,000 8% 1M
3M 5M 204,000 10% 3M
5M 10M 404,000 12% 5M
10M 1,004,000 15% 10M

ESTATE TAX TABLE

Over But Not Over The Tax Shall be Plus Of the Excess Over

P 200,000 Exempt
P 200,000 500,000 0 5% P 200,000
500,000 2,000,000 P 15,000 8% 500,000
2,000,000 5,000,000 135,000 11% 2,000,000
5,000,000 10,000,000 465,000 15% 5,000,000
10,000,000 And Over 1,215,000 20% 10,000,000

INCOME TAX TABLE FOR INDIVIDUALS

Over But not over The Tax Shall be Plus Of excess over
10,000 - 5% -
10,000 30,000 500 10% 10,000
30,000 70,000 2,500 15% 30,000
70,000 140,000 8,500 20% 70,000
140,000 250,000 22,500 25% 140,000
250,000 500,000 50,000 30% 250,000
500,000 - 125,000 32% 500,000

- end -

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