CORPORATION

1. In 2018, a domestic corporation declared and paid dividends to its shareholders as follows:
To Apol, a resident citizen P100,000
To Alex, a nonresident citizen 100,000
To George, a resident alien 100,000
To LJ, a nonresident alien engaged in trade in the Philippines 100,000
To Francis, a nonresident alien not engaged in trade in the Philippines 100,000
To Chen, a domestic corporation 100,000
To a resident foreign corporation 100,000
To a nonresident foreign corporation (with tax sparing) 100,000

How much final tax shall be withheld by the corporation?

2. Kris Inc. sold its vacant lot to Moca Corporation for P10,000,000 which it acquired at a cost of
P5,000,000. The fair market value of the said property per tax declaration is P12,000,000,
while its zonal value is P15,000,000. How much is the income tax applicable on the
transaction?

3. A domestic corporation had the following data on income and expenses during the year 2018:

Gross income, Philippines P10,000,000

Business expenses, Philippines 2,000,000
Gross income, China 5,000,000
Business expenses, China 1,500,000
Interest income, Metrobank, Philippines 300,000
Interest income, Shanghai Banking Corporation, China 100,000
Rent income, net of 5% withholding tax 190,000

How much was the income tax payable?

4. ALPHA Corporation, a domestic corporation has the following records of income and
expenses during 2018 taxable year:
Gross income, net of 1% withholding tax P1,435,500
Expenses 790,600
Rent income, net of 5% withholding tax 144,400
Dividend from domestic corporation 25,000
Royalty, gross of tax 80,000
Interest from bank deposit with PNB, net of tax 12,000

The income tax payable is:

5. The total final taxes is:

Use the following data for the next three (3) questions:
A corporation has the following data for the 2018 taxable year:

Gross income, Phil. P1,000,000

Gross income, USA 500,000
Gross income, Japan 500,000
Expenses, Phil. 300,000
Expenses, USA 200,000
Expenses, Japan 100,000
Other income:
 Dividend from San Miguel Corp. 70,000
Dividend from Ford Motors, USA 120,000
Gain on sale of San Miguel shares directly to buyers 150,000
Royalties, Phils 50,000
Royalties, USA 100,000
Interest from receivables in the Philippines 60,000
Rent Income, land in USA 250,000
Rent income, Building in the Philippines 100,000

The Company also sold a condominium classified as capital asset for P2,000,000. The cost of the
Condominium is P1,000,000 while its Zonal Value is P3,000,000.

6. Its income tax on all income as a domestic corporation is:

7. Based on the above problem, its income tax on all income if it is a resident foreign
corporation (disregard sale of condominium):

8. And if it is a non-resident foreign corporation and there is tax sparing, its income tax on all
income is (disregard sale of condominium):

9. The following information were taken from the records of ABC Inc., a domestic corporation
already in its 5th year of operations:
Gross profit from sales P3,100,000
Capital gain on sale directly to buyer
of shares in a domestic corporation 100,000
Dividend from:
Domestic corporation 20,000
Resident foreign corporation 10,000
Interest on:
Bank deposit 20,000
Trade receivable 50,000
Business expenses 2,100,000
Income tax with held 115,000
Quarterly income tax payments 160,000
Income tax payable prior year (10,000)

The income tax payable at the end of the year:

PARTNERSHIP

A business partnership organized by partners Ash and Cris, equal partners, has the following
data for the year ended 2018:
Gross business income P 1,000,000
Deductible expenses 300,000
Yield from deposit substitute, net of final withholding tax 50,000
Interest income derived from a depository bank under
EFCDS, net of withholding tax 100,000
Gain from sale of shares of stock not traded in the local
stock exchange, net of capital gains tax 80,000
Withdrawals on the share in the net income of the partners,
net of withholding tax 150,000
Rent income, gross of 5% withholding tax 300,000
Payments of quarterly taxes, first 3 quarters 120,000
 Question 1: How much is the taxable net income of the business partnership?

Question 2: How much is the tax payable of the business partnership?

Question 3: How much is the distributable net income of the partnership?

Question 4: How much is the final withholding tax on the share of each partner, if any?

5. TGT & Co. is a general partnership in trade and on its fifth year of operations. During the
current taxable year, it had a gross profit from sales and business expenses of P2,000,000 and
P1,000,000, respectively. T, G, and T share equally in the profits and losses of the
partnership. The income tax due of the partnership is:

6. The income tax payable of the partners as a consequence of being a partner in the Partnership
is:

7. TG Partnership reported for a year net profit from trading amounting to P800,000. The other
income included interest income of P8,000, net of 20% final withholding tax, and dividend
income from domestic corporation of P20,000. Assuming T and G share profits and losses
equally, how much is the final withholding tax on the distributive share of T in the earnings
of that partnership?

ESTATE

Namahinga Nah died leaving an estate worth P10,000,000. The estate is under administration. In
2018, the properties in the estate earned a gross income of P600,000 and the estate incurred
expenses of P150,000. Francis, one of the heirs, received P100,000 and
P120,000 from the 2017 and 2018 income of the estate, respectively.

1. The income tax payable of estate assuming the taxable year is 2018

TRUST

Mr. J created two (2) trusts, designating Atty. Bonafe and the Philippine Trust Company as
trustees. The common beneficiary of the two (2) trusts was his son, J II, married, and with two
(2) qualified dependent children. The following data were made available for the year 2018:
Trust No.1 Trust No.2
Gross income P 600,000 P 700,000
Business expenses 300,000 400,000
Income distribution to beneficiary 100,000 200,000

J II
Gross income P 800,000
Business expenses 250,000
Income distribution received, gross of 15%
creditable withholding tax 300,000

Question 1: How much was the tax due from each trust?

Question 2: How much was the tax due on the consolidated income?
 Question 3: How much was the tax payable of each trust after their share in the
consolidated income?

Use the following data for the next two (3) questions:
In 2018, Bongbong Jr. created two (2) trusts for his minor son, Chiz. During the year, the two
trusts earned net income as follows:
Trust 1 P4,000,000
Trust 2 6,000,000

4.-How much is the total income tax due of the two Trusts?

24. How much is the income tax due of Trust 1?

25. How much is the income tax due of Trust 2?