Problem

Taxpayer: Mr. Ronald Buyure, a resident citizen. He is married with the following qualified
dependents.
a. Legitimate daughter, 20 yrs. old, single unemployed
b. Illegitimate son of the wife, 15 yrs. old, single and unemployed
c. Mother of Ronald Buyure
d. A niece, 12 yrs old
e. An uncle who is a senior citizen

Mr. Ronald Buyure receives the folllowing:

Interest Income on time deposit- korea

Interest Income on time deposit- US
Interest Income on time deposit- phil
From Expanded Foreign Currnecy Deposit System
Long term Deposit evidenced by certificates prescribed by BSP
From notes receivable
Winnings from PCSO
Cash and other non-cash received from inheritance
Gift from a special friend
Winnings from US charity
Prizes as science achiever without competition
Prizes received from literary contributions w/o competition given by DepEd
Winnings from local town lottery
Royalty income from literary works
Amount of withholding tax withheld by the employer
His premium contribution to Philhealth, Pag-ibig, SSS
Compensation for actual damages for injuries
Interest from life insurance premiums
Proceeds from insurance policy of his deceased father
Cash dividend from domestic corporation
Cash dividend from NFRC

He received the following compensation as an accountant in the Buyyu company.

Cash amounting to 900,000 representing his annual basic salary which is gross of
Philhealth, Pag- ibig, and SSS contributions , net of withholding tax.Christmas bonus and cash
gift of 55,000, and13th month pay.
 Information from the business of Mr. Buyure.

Net Sales
Sales discount
Sales return
Cost of sales
Sale of real property located (capital asset) in Phil.,principal residence
Sale of real property located (capital asset) outside
Gain from sale of capital assets, held for 18 mons.
Loss from sale of capital assets, held for 8 mons.
Gain from sale of ordinary assets, held for 15 mons.
Loss from sale of ordinary assets, held for 9 mons.
Sale of shares of stocks through local stock exchange(capital assets)
Sale of shares of stocks outside local stock exchange(capital assets)
Fringe benefit in cash to:
Rank and File
Manageral employees
Rent expense (monthly)
VAT
Documentary stamp tax used in business operation
Interest for late payment of tax
Surcharge for late payment on income tax
Compromise penalty
Community tax
Municipal license
Real estate tax on principal residence
Real estate tax on business property
Income tax of the business
NOLCO last year
Utilities expense
Entertainment expense
Income taxes paid
Interest expense

Mr. Buyure also received following fringe benefits during the taxable year:
a. Holiday and vacation trip to Singapore

Compute:

1 Taxable net income

2 Net taxable income
3 Income tax due
4 Income subject to final tax
5 Final Tax Due
following qualified

Answer
15,000.00
20,000.00 Interest Income on time deposit- korea
20,000.00 Interest Income on time deposit- US
5,000.00 From notes receivable
6,000.00 Winnings from US charity
25,000.00 Winnings from local town lottery
40,000.00 Interest from life insurance premiums
10,000.00 Cash dividend from NFRC
80,000.00 Compensation income
150,000.00 Excess of 13th
9,000.00 Business income
12,000.00 Sale of real property located (capital asset) outside
10,000.00 Gain from sale of capital assets, held for 18 mons.
340,000.00 Loss from sale of capital assets, held for 8 mons.
20,000.00 Gain from sale of ordinary assets, held for 15 mons.
7,000.00 Loss from sale of ordinary assets, held for 9 mons.
90,000.00 Taxable net income
2,000.00
80,000.00 Personal Exemption
12,000.00 Basic
18,000.00 Additional
Net taxable income

company. 500,000
hich is gross of
istmas bonus and cash over 500,000
Income tax due
 Subject to final tax
4,500,000.00 Interest Income on time deposit- phil
225,000.00 Expanded FCDS
300,000.00 Royalty income from literary works
1,900,000.00 Cash dividend from domestic corporation
1,400,000.00 Sale of shares of stocks outside local stock exchange(c
1,500,000.00
150,000.00
75,000.00
350,000.00
160,000.00 Net Sales
180,000.00 Cost of sales
150,000.00
FB- Rank and File
300,000.00 FB- Managerial
260,000.00 Rent expense
45,000.00 Documentary stamp tax used in business operation
2,400.00 Community tax
8,000.00 Municipal license
1,200.00 Real estate tax on business property
900.00 NOLCO last year
2,000.00 Utilities expense
4,000.00 Entertainment expense
3,000.00 Interest expense
4,000.00 Business Income
6,000.00
70,000.00
50,000.00
120,000.00
8,000.00
45,000.00
12,000.00

240,000.00
 15,000.00
20,000.00
25,000.00
150,000.00
10,000.00
2,000.00
18,000.00
913,000.00
48,000.00
1,294,400.00
1,500,000.00
75,000.00
- 75,000.00
175,000.00
- 160,000.00
4,170,400.00

- 50,000.00
- 25,000.00
4,095,400.00

125,000.00
1,150,528.00
1,275,528.00
Amnt Subj. to FTRate FTD
20,000.00 20% 4,000.00
5,000.00 7.5% 375.00
340,000.00 10% 34,000.00
12,000.00 10% 1,200.00
150,000.00 5%,10% 10,000.00
527,000.00 49,575.00

4,500,000.00
1,900,000.00
2,600,000.00
- 300,000.00
- 260,000.00
- 540,000.00
- 8,000.00
- 4,000.00
- 3,000.00
- 6,000.00
- 50,000.00
- 120,000.00
- 8,000.00
- 6,600.00
1,294,400.00