NAME POSITION SALARY RATE
NO OF
MONTHLY DAILY DAYS BASIC SALARY
WORK
R&F ₱9,698.00 ₱9,698.00
YUSOP
R&F ₱12,500.00 ₱12,500.00
NAMI
CHIEF OPS OFFICER ₱35,000.00 ₱35,000.00
SANJI
ZORO CHIEF ACCOUNTANT ₱65,000.00 ₱780,000.00
ANNUAL
1 Yusop's Basic Salary ₱9,698.00
De Minimis Benefits:
Laundry Allowance ₱300.00
Clothing Allowance ₱500.00 ₱800.00
Deductions:
SSS ₱380.00
PHIC ₱150.00
HDMF ₱100.00
Nontaxable De Minimis Benefits ₱800.00 ₱1,430.00
₱9,068.00
TAX EXEMPT EXCESS
DMB PER MONTH EXCESS ANNUAL ANNUAL
Laundry Allowance ₱300.00 ₱3,600.00
Clothing Allowance ₱500.00 ₱6,000.00
Laundry Allowance ₱300.00 ₱3,600.00
Clothing Allowance ₱500.00 ₱6,000.00
Rice Allowance ₱2,000.00 ₱24,000.00
Clothing Allowance ₱500.00 ₱500.00 ₱6,000.00 ₱6,000.00
Laundry Allowance ₱300.00 ₱200.00 ₱3,600.00 ₱2,400.00
Rice Allowance ₱2,000.00 ₱1,000.00 ₱24,000.00 ₱12,000.00
Clothing Allowance ₱500.00 ₱1,500.00 ₱6,000.00 ₱18,000.00
Laundry Allowance ₱100.00 - ₱1,200.00 -
2 Nami's Basic Salary ₱12,500.00
Deductions:
SSS ₱500.00
PHIC ₱187.50
HDMF ₱100.00
TOTAL DEDUCTIONS ₱787.50
EXCESS IN CEILING 13TH MO. AND
DE MINIMIS OF DE MINIMIS OTHER BENEFITS
₱800.00
₱800.00
₱2,800.00 ₱700.00
₱31,200.00 ₱30,000.00 ₱65,000.00
taxable DMB ₱5,000.00
final 13 month ₱90,000.00
Sanji's Basic Salary ₱35,000.00
De Minimis Benefits:
Rice Allowance ₱2,000.00
Clothing Allowance ₱1,000.00
Laundry Allowance ₱500.00 ₱3,500.00
Deductions:
SSS ₱800.00
PHIC ₱525.00
HDMF ₱100.00
Nontaxable De Minimis Benefits ₱2,800.00 ₱4,225.00
Net Taxable Compensation ₱34,275.00
Net Taxable Compensation ₱34,275.00
Less: Tax base ₱33,333.00
Total ₱942.00
Multiply: Tax rate 0.25
Total ₱235.50
Add: ₱2,500.00
Tax Due ₱2,735.50
TOTAL PAY DEDUCTION
SSS PHIC HDMF
₱10,498.00 ₱380.00 ₱150.00 ₱100.00
₱13,300.00 ₱500.00 ₱187.50 ₱100.00
₱38,500.00 ₱800.00 ₱525.00 ₱100.00
₱906,200.00 ₱9,600.00 ₱10,800.00 ₱1,200.00
4 Zoro's Basic Salary (Annual)
De Minimis Benefits:
Rice Allowance ₱36,000.00
Clothing Allowance ₱24,000.00
Laundry Allowance ₱1,200.00
13th month pay and other benefits
Deductions:
SSS ₱9,600.00
PHIC ₱10,800.00
HDMF ₱1,200.00
Nontaxable De Minimis Benefits ₱31,200.00
13th month and other benefits ₱90,000.00
Net Taxable Compensation
Net Taxable Compensation ₱763,400.00
Less: Tax base ₱400,000.00
Total ₱363,400.00
Multiply: Tax rate 0.25
Total ₱90,850.00
Add: ₱30,000.00
Tax Due ₱120,850.00
NON TAXABLE NET TAXABLE WITHHOLDING NET
TOTAL DEDUCTION
COMPENSATION COMPENSATION TAX COMPENSATION
₱630.00 ₱9,068.00
₱787.50 ₱12,512.50
₱1,425.00 ₱34,275.00 ₱2,735.50
₱21,600.00 ₱763,400.00 ₱120,850.00
₱780,000.00
₱61,200.00
₱65,000.00
₱142,800.00
₱763,400.00
NAME POSITION SALARY RATE
NO OF
MONTHLY DAILY DAYS BASIC SALARY
WORK
R&F ₱9,698.00 ₱9,698.00
YUSOP
R&F ₱12,500.00 ₱12,500.00
NAMI
CHIEF OPS OFFICER ₱35,000.00 ₱35,000.00
SANJI
ZORO CHIEF ACCOUNTANT ₱65,000.00 ₱780,000.00
ANNUAL
1 Yusop's Basic Salary ₱9,698.00
De Minimis Benefits:
Laundry Allowance ₱300.00
Clothing Allowance ₱500.00 ₱800.00
Deductions:
SSS ₱380.00
PHIC ₱150.00
HDMF ₱100.00 ₱630.00
₱9,868.00
TAX EXEMPT EXCESS
DMB PER MONTH EXCESS ANNUAL ANNUAL
Laundry Allowance ₱300.00 ₱3,600.00
Clothing Allowance ₱500.00 ₱6,000.00
Laundry Allowance ₱300.00 ₱3,600.00
Clothing Allowance ₱500.00 ₱6,000.00
Rice Allowance ₱2,000.00 ₱24,000.00
Clothing Allowance ₱500.00 ₱500.00 ₱6,000.00 ₱6,000.00
Laundry Allowance ₱300.00 ₱200.00 ₱3,600.00 ₱2,400.00
Rice Allowance ₱2,000.00 ₱1,000.00 ₱24,000.00 ₱12,000.00
Clothing Allowance ₱500.00 ₱1,500.00 ₱6,000.00 ₱18,000.00
Laundry Allowance ₱100.00 - ₱1,200.00 -
2 Nami's Basic Salary ₱12,500.00
Deductions:
SSS ₱500.00
PHIC ₱187.50
HDMF ₱100.00
TOTAL DEDUCTIONS ₱787.50
EXCESS IN CEILING 13TH MO. AND
DE MINIMIS OF DE MINIMIS OTHER BENEFITS
₱800.00
₱800.00
₱2,800.00 ₱700.00
₱31,200.00 ₱30,000.00 ₱65,000.00
taxable DMB ₱5,000.00
final 13 month ₱90,000.00
Sanji's Basic Salary ₱35,000.00
De Minimis Benefits:
Rice Allowance ₱2,000.00
Clothing Allowance ₱1,000.00
Laundry Allowance ₱500.00 ₱3,500.00
Deductions:
SSS ₱800.00
PHIC ₱525.00
HDMF ₱100.00 ₱1,425.00
Net Taxable Compensation ₱37,075.00
Net Taxable Compensation ₱37,075.00
Less: Tax base ₱33,333.00
Total ₱3,742.00
Multiply: Tax rate 0.25
Total ₱935.50
Add: ₱2,500.00
Tax Due ₱3,435.50
TOTAL PAY DEDUCTION
SSS PHIC HDMF
₱10,498.00 ₱380.00 ₱150.00 ₱100.00
₱13,300.00 ₱500.00 ₱187.50 ₱100.00
₱38,500.00 ₱800.00 ₱525.00 ₱100.00
₱906,200.00 ₱9,600.00 ₱10,800.00 ₱1,200.00
4 Zoro's Basic Salary (Annual)
De Minimis Benefits:
Rice Allowance ₱36,000.00
Clothing Allowance ₱24,000.00
Laundry Allowance ₱1,200.00
13th month pay and other benefits
Deductions:
SSS ₱9,600.00
PHIC ₱10,800.00
HDMF ₱1,200.00
Nontaxable De Minimis Benefits ₱31,200.00
13th month and other benefits ₱90,000.00
Net Taxable Compensation
Net Taxable Compensation ₱763,400.00
Less: Tax base ₱400,000.00
Total ₱363,400.00
Multiply: Tax rate 0.25
Total ₱90,850.00
Add: ₱30,000.00
Tax Due ₱120,850.00
NON TAXABLE NET TAXABLE WITHHOLDING NET
TOTAL DEDUCTION
COMPENSATION COMPENSATION TAX COMPENSATION
₱630.00 ₱9,868.00
₱787.50 ₱12,512.50
₱1,425.00 ₱37,075.00 ₱3,435.50
₱21,600.00 ₱763,400.00 ₱120,850.00
₱780,000.00
₱61,200.00
₱65,000.00
₱142,800.00
₱763,400.00
PER MONTH
INCOME ABROAD (3 MONTHS) 25,000.00 excluded income of OCW p 281
BUSINESS INCOME 500,000.00 2500
INCOME FROM PROFESSION 350,000.00 3500
COMPENSATION INCOME 30,000.00 5,000.00
INSURANCE PROCEEDS 1,000,000.00 nontaxable/excluded from gross income p. 293
FRANCHISE INCOME 250,000.00
EXPENSES
ENDING INVENTORY 120,000.00
PURCHASES 300,000.00
REPRESENTATION EXPENSE 50,000.00 6000
RENT EXPENSE NET OF WITHHOLDING TAX 331,578.95 35,000.00
36,842.11
GASOLINE EXPENSE 80,000.00
DONATION TO CHARITABLE INSTITUTION 15,000.00 113,000.00
INTEREST IN RELATION TO PERSONAL LOAN 20,000.00 not deductible bc personal
HOW MUCH IS THE GROSS INCOME OF MR. LEYMAR?
₱3,750,000.00 1 Business Income ₱500,000.00
Income from profession ₱350,000.00
Compensation income ₱30,000.00
Franchise Income ₱250,000.00
om gross income p. 293 Gross Income ₱1,130,000.00
HOW MUCH IS THE TOTAL EXCLUSIONS FROM ALL OF HIS INCOME? EXPLAIN WHY ARE THOSE I
COMPUTATION OF TAXABLE INCOME
2 Income from work abroad ₱3,750,000.00
Franchise Income ₱250,000.00
Insurance proceeds ₱1,000,000.00
Total ₱5,000,000.00
The total exclusion from his income is 4,750,000.00 which consists of Mr. Leymar's income from h
friend's insurance. The reason for this is that compensation income earned outside the Philippines
nontaxable compensation income and specifically excluded by the law as part of the gross income
also excluded since it is a passive income that is subject to a final tax of 20%. As for the insurance p
the gross income since it is nontaxable for the reason that the insured person has already died, w
reason for this is that the amount received serves as the reimbursement for th
HOW MUCH IS THE FINAL TAX?
3 Franchise Income ₱250,000.00
Multiply: 20% Final Tax Rate 0.2
Final Tax ₱50,000.00
HOW MUCH IS THE TAX DUE IF MR. LEYMAR OPT TO CHOOSE 8 PERCENT IN LIEU OF ALL TAXE
4 Business Income ₱500,000.00
Income from profession ₱350,000.00
Net Taxable Income ₱850,000.00
Nontaxable Compensation Income ₱30,000.00
Tax Due (850,000x8%) ₱68,000.00
5 HOW MUCH IS THE TAX DUE IF MR. LEYMAR OPT TO CHOOSE GRADUATED INCOME TAX TABLE
ITEMIZED DEDUCTION?
HOW MUCH IS THE TAX DUE IF MR. LEYMAR OPT TO CHOOSE GRADUATED INCOME TAX TABLE
ITEMIZED DEDUCTION?
Compensation Income ₱30,000.00
Business Income ₱500,000.00
Income from profession ₱350,000.00
Total ₱880,000.00
Purchases ₱300,000.00
Ending Inventory ₱120,000.00
COGS ₱180,000.00
Rent Expense ₱331,578.95
Business Income (500,000x0.005) ₱2,500.00
Income from profession (350,000x0.01) ₱3,500.00
Representation ₱6,000.00
Donation to charitable institution ₱15,000.00
Gasoline Expense ₱80,000.00
Total Itemized Deductions ₱612,578.95
Net Taxable Income ₱267,421.05
Tax Due (Over 250,000 but less than 400,000) ₱3,484.21
HOW MUCH IS THE TAX DUE IF MR LEYMAR OPT TO CHOOSE
GRADUATED INCOME TAX TABLE AND OSD?
6 Compensation Income ₱30,000.00
Business Income ₱500,000.00
Income from profession ₱350,000.00
Total ₱880,000.00
Optional Standard Deduction (850,000x40%) ₱340,000.00
Net Taxable Income (880,000-352,000) ₱540,000.00
Tax Due (Over 400,000 but less than 800,000) ₱65,000.00
BONUS QUESTION
JUNE 14, 2020
COME? EXPLAIN WHY ARE THOSE ITEMS EXCLUDED FROM THE
F TAXABLE INCOME
ists of Mr. Leymar's income from his work abroad and the proceeds from his
me earned outside the Philippines by a Filipino Overseas Contract Worker is a
he law as part of the gross income for taxation purposes. Franchise income is
tax of 20%. As for the insurance proceeds, it is also excluded by the law from
nsured person has already died, which in this case, Mr. Leymar's friend. The
serves as the reimbursement for the loss of life suffered.
SE 8 PERCENT IN LIEU OF ALL TAXES?
GRADUATED INCOME TAX TABLE AND
Net Taxable Income ₱267,421.05
Less: Tax base ₱250,000.00
Total ₱17,421.05
Multiply: Tax rate ₱0.20
Tax Due ₱3,484.21
Net Taxable Income ₱540,000.00
Less: Tax base ₱400,000.00
Total ₱140,000.00
Multiply: Tax rate ₱0.25
Total ₱35,000.00
Add: ₱30,000.00
Tax Due ₱65,000.00
