a. Mr. CSO, works for G.O.D., Inc.

He is not engaged in business nor has any other source of income

taxable compensation income of P 1,060,000.00. How much is his income tax liability?

His income tax liability will be computed as follows:

Taxable Compensation Income P 1,060,000.00

Tax Due:
On P800,000 P 130,000.00
On excess (P1,060,000 - 800,000)*30% 78,000.00
Tax Due: P 208,000.00

b. Mr. EBQ operates a convenience store while she offers bookkeeping services to her clients. In 20
receipts from bookkeeping services of P300,000.00. She already signified her intention to be ta
is the income tax liability for the year?

His income tax liability will be computed as follows:

Gross Sales - Convenience Store P 800,000.00

Gross Receipts - Bookkeeping 300,000.00
Total Sales/Receipts P 1,100,000.00
Less: Amount allowed as deduction under 250,000.00
Section. 24 (A) (2) (b)
Taxable Income P 850,000.00

Tax Due (8% of P850,000.00) P 68,000.00

c. Ms. EBQ above, failed to signify her intention to be taxed at 8% income tax rate on gross sales in
sales andoperating expenses amounting to P600,000.00 and P200,000.00, respectively or total

Gross Sales/Receipts P 1,100,000.00

Less: Cost of Sales 600,000.00
Gross Income P 500,000.00
Less: Operating Expenses 200,000.00
Taxable Income P 300,000.00

Tax Due:
On excess (P300,000.00 - P250,000.00)*20% P 10,000.00

Ms. MRU operates a convenience store while she offers bookkeeping services to her clients. In 2018
gross receipts from bookkeeping services of P400,000.00. Her recorded cost of goods sold and oper

Question 1 – How much is Ms. MRU’s taxable income and income tax due if she opted to avail of the
 2 - Can she avail of the 8% option?
3 – How much is her income tax liability if she signifies her intention to be taxed at 8% inco

Ms. MRU opted to avail of the OSD, and taxable income shall be computed as follows:

Gross Sales - Convenience Store P 1,800,000.00

Gross Receipts - Bookkeeping 400,000.00
Total P 2,200,000.00
Less: OSD (P2,200,000 x 40%) 880,000.00
Net Taxable Income P 1,320,000.00

Tax Due:
On P800,000.00 P 130,000.00
On Excess (1,320,000-800,000)*30% 156,000.00
Total Tax Due P 286,000.00

Gross Sales - Convenience Store P 1,800,000.00

Gross Receipts - Bookkeeping 400,000.00
Total P 2,200,000.00
Less: Amount allowed as deduction under 250,000.00
Sec . 24 (A) (2) (b)
Net Taxable Income P 1,950,000.00

Tax Due: (8% of 1,950,000) P 156,000.00

e. In 2018, Mr. MAG, a Financial Comptroller of JAB Company, earned annual compensation of P1,5
benefits in the amount of but net of mandatory contributions to SSS and Philhealth. Aside from e
gross sales of P2,400,000. His cost of sales and operating expenses are P1,000,000 and P600,00

Question 1 – How much is his tax due for 2018 if he opted to be taxed at eight percent (8%) inco
2 – How much is his tax due for 2018 if he did not opt for the eight percent (8%) income

1 His tax due for 2018 shall be computed as follows if he opted to be taxed at 8% income tax rate

Total Income Compensation P 1,500,000.00

Less: Non-taxable 13th month pay and 90,000.00
other benefits (max)
Taxable Compensation Income P 1,410,000.00

Tax Due:
1. On Compensation:
On P800,000.00 P 130,000.00
On excess (P1,410,000 - P800,000)*30% 183,000.00
 Tax Due on Compensation Income P 313,000.00

2. On Business Income:
Gross Sales P 2,400,000.00
Add: Non-operating Income 100,000.00
Taxable Business Income P 2,500,000.00
Multiplied by income tax rate 8%
Tax Due on Business Income P 200,000.00

Total Income Tax Due (Compensation and P 513,000.00

Business)

2 His tax due for 2018 shall be computed as follows if he did not opt for the 8% income tax based

Total Compensation Income P 1,500,000.00

Less: Non-taxable 13th month pay and other
benefits (max) 90,000.00
Taxable Compensation Income P 1,410,000.00
Add: Taxable Income from Business
Gross Sales P 2,400,000.00
Less: Cost of Sales 1,000,000.00
Gross Income P 1,400,000.00
Less: Operating Expenses 600,000.00
Net Income from Operation P 800,000.00
Add: Non-operating Income 100,000.00 900,000.00
Total Taxable Income P 2,310,000.00

Tax Due:
On P2,000,000.00 P 490,000.00
On excess (P2,310,000 - 2,000,000)*32% 99,200.00
Total Income Tax P 589,200.00
other source of income other than his employment. For 2018, Mr. CSO earned a total
e tax liability?

ices to her clients. In 2018, her gross sales amounted to P800,000.00, in addition to her
d her intention to be taxed at 8% income tax rate in her 1st Quarter Return, How much

ax rate on gross sales in her 1st Quarter Income Tax Return, and she incurred cost of
0, respectively or total of P800,000.00. How much is the income tax?

s to her clients. In 2018, her gross sales amounted to P1,800,000.00 in addition to her
t of goods sold and operating expenses were P1,325,000.00 and P320,000.00, respectively.

he opted to avail of the OSD?

n to be taxed at 8% income tax rate in her 1st Quarter Return?

al compensation of P1,500,000.00, inclusive of 13th month and other P120,000.00

Philhealth. Aside from employment net income, he owns a convenience store, with
1,000,000 and P600,000, respectively, and with non-operating income of P100,000.

eight percent (8%) income tax rate of his gross sales for his income from business?
t percent (8%) income tax based on gross sales/receipts and other non-operating income?

at 8% income tax rate on his gross sales for his income from business:
e 8% income tax based on gross sales/receipts and other non-operating income:

1,500,000.00

90,000.00
1,410,000.00

900,000.00
2,310,000.00

490,000.00
99,200.00
589,200.00
a. On December 1, 2018, Juanito Cruz created a trust for his son Alberto and appointed Dani
as the trustee. On December 26, 2018, another trust was created by Juanito for the benefi
son, Alberto, single. Juancho Garcia was appointed as the trustee. The following data perta
the two trusts:
Trust under Danilo
Gross income P500,000.00
Expenses 100,000.00
Income distributed to Alberto, gross of 15% withholding tax P50,000.00

Compute the tax due from:

1) each trust. 3) each trust after share in the consolid
2) the consolidated income. 4) the beneficiary.

1) Tax due of each trust:

Trust under Danilo
Gross Income P 500,000
Less: Expenses 100,000
Income distribution 50,000
Taxable Net Income P 350,000
Tax due (Sec. 24) (A) P 20,000

2) Tax due from the consolidated income

Consolidated Gross Income (500,000 + P 1,100,000

600,000)
Less: Consolidated Expenses (100,000 + 400,000
300,000)
Consolidated income distribution 150,000
(50,000 + 100,000)
Taxable Net Income P 550,000
Tax due (Sec. 24) (A) P 67,500

3) Tax due from each trust after share in consolidated in

Trust under Danilo
Share in consolidated income tax P 42,955
Less: Income already paid 20,000
Tax Payable P 22,955

Trust under Danilo [ (350,000/550,000) x

67,500]
Trust under Juancho [(200,000/550,000) x
67,500]
4) Tax due from the beneficiary

Income distribution received P 150,000

Tax due (Sec. 24) (A) -
Less: Creditable withholding tax (15% x 22,500
150,000)
Tax Payable (Over Payment) P 22,500
o and appointed Danilo Paz
uanito for the benefit of the
e following data pertain to

nder Danilo Trust under Juancho

P500,000.00 P600,000.00
100,000.00 P300,000,00
P50,000.00 P100,000.00

share in the consolidated income tax.

Trust under Juancho

P 600,000
300,000
100,000
P 200,000
P Exempt

Trust under Juancho

P 24,545
-
P 24,545
c. Mr. JMLH signified her intention to be taxed at 8% income tax rate on gross sales in her 1st Quar
Income Tax Return. However, her gross sales during the taxable year has exceeded the VAT thre
Q1 Q2 Q3
(8% rate) (8% rate) (8% rate)
Total Sales P500,00.00 P500,000.00 P2000000
Less: Cost of Sales 300,000.00 300,000.00 1,200,000.00
Operating Expenses 120,000.00 120,000.00 480,000.00

REQ: 1) Compute the quarterly income tax payable and show the due dates.
2) Compute the income tax due when the final or adjusted return is filed and show the due

1) Quarterly Income Tax Payable

First Quarter Second Quarter
Gross Sales P 500,000.00 P 1,000,000.00
Less: Exempt Amount 250,000.00 250,000.00
Taxable Income P 250,000.00 P 750,000.00
Tax Due (8%) P 20,000.00 P 60,000.00
Less: Tax Payments, previous quarters - 20,000.00
Tax Payable P 20,000.00 P 40,000.00
Due Date 15-May 15-Aug

2) Income tax due when final icnome tax return is filed

Total Sales P 6,000,000.00

Less: Cost of Sales 3,000,000.00
Gross Income P 3,000,000.00
Less: Operating Expenses 1,440,000.00
Taxable Income P 1,560,000.00
Tax Due under the graduated rates 358,000.00
Less: 8% income tax previously paid 220,000.00
(Q1toQ3) (3,000,000 - 250,000
= 2,750,000 x 8%)
Annual Income Tax Payable 138,000.00
Due Date 15-Apr
s sales in her 1st Quarter
xceeded the VAT threshold.
Q4

P3,000,000.00
1,200,000.00
720,000.00

ed and show the due date.

Second Quarter Third Quarter

1,000,000.00 P 3,000,000.00
250,000.00 250,000.00
750,000.00 P 2,750,000.00
60,000.00 P 220,000.00
20,000.00 60,000.00
40,000.00 P 160,000.00
15-Aug 15-Nov
d. Compute the withholding tax using the table on the last part of the Self-Learning Module.

1) An employee receiving daily compensation in the amount of P2,500, net of mandatory c

Total Taxable Compensation P 2,500.00

Less: Compensation Range 2,192.00
Excess P 308.00

Withholding Tax shall be

computed as follows:
Predetermined Tax on P2,192 P 356.16
Add: Tax on the excess (P308*30%) 92.4
Total daily withholding tax P 448.56

2) An employee receiving weekly compensation in the amount of P9,500, net of mandator

Total Taxable Compensation P 9,500.00

Less: Compensation Range 7,692.00
(Minimum)
Excess P 1,808.00

Withholding Tax shall be computed

as follows:

Tax on P7,692.00 P 576.92

Tax on the excess (P1,808 x 25%) 452.00
Total Weekly withholding tax P 1,028.92

3) An employee receiving semi-monthly compensation in the amount of P170,500, with su

Total Taxable Compensation P 170,500.00

Less: Compensation Range 166,667.00
(Minimum)
Excess P 3,833.00
Add: Supplemental Compensation 5,000.00
Total Taxable Compensation for P 8,833.00
the month

Withholding Tax shall be computed

as follows:

Tax on P166,667 P 40,833.33

Tax on the excess including 2,826.56
supplemental compensation
(P8,833 x 32%)
Total monthly withholding tax P 43,659.89
elf-Learning Module. (Revised Withholding Tax Table Version 2)

00, net of mandatory contributions.

,500, net of mandatory contributions.

t of P170,500, with supplemental income of P5,000, net of mandatory contributions.