A.

Tax situs rules provide that the income of a citizen of the

Philippines, such as Ms. B's income from what she sold to
Ms. C, is taxable within or without the Philippines (Sec. 22,
NIRC).
B. Section 22 of the NIRC provides, "An alien individual,
whether a resident or not of the Philippines, is taxable only
on income derived from sources within the Philippines."
Therefore, Ms. B's income is not taxable in the Philippines
because the source of her income is in China.

a) Mr. E = 50,000 pesos; Ms. F = 50,000 pesos

b) Mr. E= P100,000 total (50,000 personal exemption +
25,000 per dependent child; Ms.F=P50,000 personal
exemption
c) Mr. E=P150,000 (PE + 4 dependents); Ms.F=P50,000
(PE)

a) 10% FWT
b) 20% FWT
c) 25% of GI within Phils
d) Exempt
e) 15% FWT subject to reciprocity

I.
II.

Principles of a sound tax system: fiscal adequacy administrative feasibility and theoretical justice
CASE: Pacquiao case-Tax principles if money earned thru winning in another country
A. Income Taxation Law provides that a citizen of the Philippines, such as in the case of Mr. A, is
taxable for his earnings within or without the Philippines. He is also a subject to the 32% tax
rate under the tax base provisions of the Tax Code.
B. He cannot claim exclusion because his earnings was based on the principle of Active Income
where he exerted efforts to earn it. Hence, he is still taxable under the Income Taxation Law.

Differentiate double taxation in a strict sense and in broad sense and give samples to each:
ANSWER: Strict sense double taxation is when a taxpayer is taxed at least twice by the same authority in

the same jurisdiction for the same purpose on the same taxing period. Such is prohibited in this jurisdiction
for it violates constitutional provisions of equal protection and that taxation must be equitable.
Indirect or double taxation in its broad sense is the presence of two or more of the above enumerated
burdens of taxing a taxpayer twice and is not unconstitutional but is a practice that is frowned upon.

VATable - property leased is in the Philippines

a) The CTA did not acquire jurisdiction over the petition of FFF,
Inc. Administrative remedies must first be exhausted before a
Petition for Review with the CTA may prosper. After filing a
claim for unutilized input VAT, the taxpayer may either wait
for the BIR to act, or wait 120 days from date of filing and
subsequent inaction of the BIR before he can elevate his claim
to the CIR. The petition here having been filed less than 120
days from the BIR's inaction, the CTA did not acquire
jurisdiction over the claim for refund of FFF. (CIR vs. San
Roque)
b) The taxpayer has to wait 120 days from the date of his
filing to the BIR, and if the BIR doesn't act upon his
administrative claim for refund, he may elevate the same via

a Petition for Review to the CTA division within 30 days from BIR's inaction on his petition, i.e. 30 days from the date the 120 days
expired..

No
Yes
Yes
No
No

What are de minimis and how are they taxed? Give 3 examples.
Answer: Are benefits which are relatively small in value given to employees by employers to uplift health,

well-being or done for good-will and are generally exempt from taxation as in witholding or fringe benefits
tax. Ex. Vacation leave that has been monetized not exceeding 10k php, monthly rice allowance
amounting to 1.5k php, clothing allowance not exceeding 5k per year.
In order that the sale of his residential house and lot may be exempted from the
capital gains tax, he should fulfill the following requisites:
1) Said house should be a residential house
2) He should utilized the proceeds from the sale of the house and lot within 18
months from such sale.
3) He should use ALL the proceeds from said sale in acquiring a new residential
house. Any amount not utilized shall be subject to a 6% Capital Gains Tax
4) He should inform the BIR in writing of his intention to avail of the exemption
within 30 days from date of sale.
5) Said exemption can only be availed of once every 10 years.

RCIT
The company will be liable for MCIT beginning on
the 4th year following its incorporation. From then
on, the company will pay RCIT or MCIT, whichever is
higher.

Use Optional Standard deduction which is 40% of his

gross reciepts.

A. Importation begins when the carrying vessel or

aircraft enters the jurisdiction of the Philippines
with intention to unlade therein. Importation is
deemed terminated upon payment of duties, taxes
and other charges due upon the articles, or sec be
paid, at a port of entry and the legal permit for
withdrawal shall have been granted, or in case
said are free of duties, taxes and other charges,
until they have legally left the jurisdiction of the customs.SEC 1202 TCCP
A.

Importation begins when the carrying vessel or aircraft

enters the jurisdiction of the Philippines with intention to
unlade therein. Importation is deemed terminated upon
payment of duties, taxes and other charges due upon
the articles, or sec be paid, at a port of entry and the
legal permit for withdrawal shall have been granted, or
in case said are free of duties, taxes and other charges,
until they have legally left the jurisdiction of the
customs.SEC 1202 TCCP

A. The liability must represent a personal obligation

of the deceased at the time of death; the obligation
was contracted in good faith & for adequate and full
consideration; the claim must be a debt or claim
which is valid in law and enforceable in court; and
the claim must not have been condoned by the
creditor during the lifetime of the decedent.
B. Medical expenses incurred by the decedent within one year prior to his death which shall be duly
substantiated with official receipts. Provided, that in no case shall the deductible medical expenses exceed
P500,000.