January 18, 2017

Accreditation of tax agent

Qualifications to be a tax agent
Are lawyers still required to be accredited to become a tax agent
Are all taxpayers required to keep book of accounts
If application for accreditation is denied, where to appeal
What are the official languages? Basis.
Can the secretary of finance increase or decrease the tax rate
Delinquency interest vs deficiency interest
6 general principles in income taxation (memorize sec. 23)
nstances when the 25% surcharge may be imposed
Feb 1, 2017
TAX2: From Atty. Dy:

Gudam. Sorry for late rep. Had to attend to a family medical issue. Emailed u earlier on new assignment. Kindly
forward to other section. We will focus on previous assignment tonight including cases and issuances

ASSIGNMENT FOR NEXT MEETING

January 31, 2017

1. Sections 24 – 30, Tax Code as amended;

2. Revenue Regulation No. 9-1998 and Revenue Regulation No. 12-2007 (MCIT);
3. RA No. 10026 (LWDs);
4. RA No. 10378 (international carrier);
5. Revenue Regulation No. 15-2002 as amended by Revenue Regulation No. 11-2011
6. Revenue Regulation No. 14-2012 (interest income from FIs)
7. Revenue Regulation No. 2-2001 & RMC 35-2011 (IAET);
8. Revenue Regulation No. 4-2011 (allocation in banks and FIs);
9. Revenue Regulation No. 13-98 (qualified done institutions);
10. RMC Nos. 76-2013 and 35-2012;
11. Revenue Regulation No. 07-2003;
12. Revenue Regulation No 6-2008 as amended by RR No. 6-2013;
13. CIR vs. St Luke’s Medical Center, GR No. 195909 and 195960 dated Sept 26, 2012;
14. Chamber of Real Estate and Builder’s association vs. Romulo, GR No. 160756 dated March 9, 2010

Feb 2, 2017
Ebay transaction - buyer (filipino citizen) is in china; seller is in US. What is the situs of taxation?
Online gambling-player is in China; dealer is in Makati. Decide the situs.
Define corporation under NIRC
Define trust
Is a trust taxable as a corporation or as an individual?
How many kinds of partnership under the civil code
Limited partnership is considered as corporation for taxation purpose, true or false?
What is partnership by estoppel
2 people agreed to sell a toy and to divide the profit among themselves. Should they be taxed individually or as a
partnership?
A co-ownership cannot be taxed as partnership, true or false
Ph citizen working in US embassy and not allowed to leave the premises. Is he considered a resident or non
resident citizen? How about his income, is it considered derived from within or without the ph?
British american tobacco case (super detailed) know the rational basis test
Do you agree with the SC's ruling? If you were to disagree, what would be your arguments?
Conjoined twins (2 heads, one body, different names) taxed as one or separately? Should they be allowed to have
2 TINs or only one? Decide with legal basis (better to check civil code)
Feb 8, 2017
ASSIGNMENT FOR NEXT MEETING
January 31, 2017

1. Sections 24 – 30, Tax Code as amended;

2. Revenue Regulation No. 9-1998 and Revenue Regulation No. 12-2007 (MCIT);
3. RA No. 10026 (LWDs);
4. RA No. 10378 (international carrier);
5. Revenue Regulation No. 15-2002 as amended by Revenue Regulation No. 11-2011
6. Revenue Regulation No. 14-2012 (interest income from FIs)
7. Revenue Regulation No. 2-2001 & RMC 35-2011 (IAET);
8. Revenue Regulation No. 4-2011 (allocation in banks and FIs);
9. Revenue Regulation No. 13-98 (qualified done institutions);
10. RMC Nos. 76-2013 and 35-2012;
11. Revenue Regulation No. 07-2003;
12. Revenue Regulation No 6-2008 as amended by RR No. 6-2013;
13. CIR vs. St Luke’s Medical Center, GR No. 195909 and 195960 dated Sept 26, 2012;
14. Chamber of Real Estate and Builder’s association vs. Romulo, GR No. 160756 dated March 9, 2010.
Lahat tinackle niya sa provisions halos except the cases
Inuna niya corporate tapos puro individual na
Sabi niya midterm coverage up to sec. 30, lahat ng homework natin in whole, whether discussed or not

Feb 9, 2017
Exemptions sa sec 30. Nagstart kami doon. Enumerate then difference nila sa consti provisions. Ano basis ng
exemptions? How to construe?

Give examples ng hindi recognized org sa beda. Example ni classmate, frat. Nagbenta si frat ng flowers at books sa
feb 14. May kita sila na 100k. Taxable? Bakit? As what? How much? Eh pano pah recognized org sa beda like LsG?
300k for example ang kinita nila. Taxable? Why? Makukuha ba nila yung personality ni beda?

Yung taga xerox sa lib. Si ate jackie. Considered ba siya as emplyedado ng beda? How much dapat tax niya? Taxable
ba talaga yung kita niya? As what? Give legal basis.

Differnece ng winnings sa prizes. Thunderbird something sa La Union. Naglaro ka ng poker? Tapos, nananlo ka ng
1M. Ano yun? Taxable? Basis? As what? Income?

Si atty amurao nung buhay pa. Nagkita kami sa deans habang meryenda ko. Sabi niya anthony, malapit na matapos
book ko. Ano sasabihin mo as tax law expert? Sir, huwag niyo na iunlish? Or ipapublish sa beda? Sa rex? Bakit????

May tumawag sau na client. Ano daw significance bakit kelangan mo malaman sino minimum wage earner? Tapos,
ang sweldo nila is 450 halimbawa. Pero dimo tinaas yunh sweldo ng supervisory employees. Nagwelga sila tuloy.
Ano sasabihin mo para happy employer? Happy lahat? Pati ikaw?
May kulang pala. Individual vs. Corporate tax? Bakit fixed si corporate eh si individual eh graduated? Pero pwede
daw maging isa lang may ari ng corporation. So pano?
Preferential sa filipino at foreigners. Pano kung emplyado mo ay filipino pero walang treatment sa company dahil
walang foreigner. Pero foreign company siya. Valid?
Magkatapat na jolibee at mang inasal. Si mang inasal, corporation siya. Madami may ari. Si jollibee, isa lang may
ari. Same profit, 10M. Pano mo sila itatax? As what? Fair ba? Weh? Pano?
Pacquiao. Sponsord a bill. Gusto niya yung fixed rate basis sa income tax, sa inidividual mag apply. Grduated na sa
corpo. Valid? Why

Father X, prof parehas sa UST at Beda ng Sem4 classes. Sa Beda, kinakaltas na sweldo niya. Sa UsT, hindi pa.
Binibigay buong sweldo. Nagtanong siya kung sino sa dalawa tama? Ano sasabihin mo? Hindi ako si Atty dy? Tax
evasion ba yun? Weh
Feb 16, 2017
Conditions for a filipino to be entitled to preferential tax rate (PTR?
Where to file the challenged revenue regulation
Is it within the power of the DOF or the BIR to impose salary condition in order to be entitled to the PTR?
Are all kinds of employees allowed to work in regional operating headquarters (ROHQ)
Test under the labor code to determine a managerial employee
Can a general manager be transferred to ROHQ to be entitled to PTR?
Head of legal - allowed to transfer on the ROHQ? She has no staff and secretary, is she entitled to PTR?
A gave B 10k worth of chocolates. Can B be taxed? Assuming taxable, under what rate?
Crown of Miss Universe - taxable?
Sash and flowers - taxable?
1st floor gym and sari sari store of A, 2nd floor residential home of A and family - sold for 20m - shall it be taxed as
residential or commercial?
Jara notes - can dean jara be taxed if he gets 10php per copy? What kind of income?
Antonym of passive income
Pageant held in north korea - what will be the tax implication considering that ph and north korea do not have
diplomatic relation?
600k yearly allowance received by wife from husband - taxable? Tax rate?
ABC corp interest income of 10m for 2016. Determine the tax implications
Pacquiao won in LA in the amount of 100m given by the casino in LA -discuss the tax implications
Is any income from the casino located in EZA considered income from within or without?
Local movie made by ABC filipino corp. Singaporean company entered into a contract with ABC for the showing of
the movie for a consideration of 1M - discuss the tax implications (recipient of 1M is ABC), passive or graduated?
SM cinemas paid marvel for the showing of the Avengers in sm cinemas for 10m - discuss the tax implications
Ph national museum has been allowed to exhibit the mona lisa painting for 1M. The beneficiary painting is a
foreign museum. Discuss the tax implications. What if the foreign museum is a non-stock and non-profit museum,
discuss the taxability of 1M
If you give sub-franchise to a local corporation for gonuts donuts for 10M, is the franchise taxable? Schedular or
fixed?
Can royalty income be classified as active or passive?
Is it more beneficial for a local franchise company to treat royalty income as passive income or as active income? It
depends. Know the purpose clause in the AoI of the corporation.
1. Basis ng 15% preferential treatment sa mga filipinos sa ROHQ. Why give them?
2. Yung 975k something na required sweldo na nasa RMC, valid? Hindi ba ultra vires act?
3. May client ako, conglomerate. Maraming ROHQ. Asked me kung pwede ba raw lahat ng managers nila sa
branches nila pwede lumipat lahat sa ROHQ. Pwede?
4. Difference bet managerial and technical
5. Paano pag head cook? Senior stylist? Assistant stylist?
6. Example ng international hotel - classmate said Shangrila. So yung headcook nila doon, pwede ba yung foreigner
or dapat Pinoy? Technical yung head cook?
7. How about general manager?
8. Ako? Dean sundiang? Nars?
9. Hotel bouncer? Hotel security guard? Technical or managerial?
10. Atty sumilong my batchmate asked me kung Ano mas okay sa kaniya. She was asked by an international
company na maging head of legal sa main office dito sa pinas or maging barnxh manager sa ROhQ? Same salary
11. Manager ba siya kung siya ay "head of legal"? Siya lang. No staff/secretary.
12. Test to determine each employee
----tax practice should be consistent with reality------
Read sandoval notes in pol law when in 4th year law
13. May lupa at bahay si bayaw sa caloocan ko. Sa first floor floor, may gym at sari sari atore. Sa 2nd floor, nakatira
sila. Pag binenta niya ng 20M, any tax implications? For tax purposes, how do u classify?
14. Dean jara notes. Diba marami na yan? 2004, 2013, 2015. Okay. Binbenta ni ate jackie. Nalaman ni dean jara. Eh
gusto ni dean na may kita siya bawat notes. Say 10 pesos per studnet na magpaxerox. Tax implications?
16. Actors and acttessses. Fillipino resident sila. Nasa singapore pinalabas yunh movie nila. Any tax?
18. Ms universe. Crown? Yung flowers? Meeon ba? Pano pag gift na 100k? Meron bang tax?
19. Muslim family. 4 asawa. Each asawa may 20k monthly allowance. Nakakapagod yun noh? 4 asawa mo? Haha.
Ano tax implications ng 20k na allowance?
20. 10 hectares agricultural land ni A. Pinasaka kay B. Agreement, may 25% si A sa harvest ni B. Tax?
21. ABC Corporation. May 15M income interest. Tax?
Quinalify ni classmate kung domestic or foreign. Sabi ni sir, kung yan lamh tanong sa bar, qualify mo? General
facts, general answer. Huwag mag assume be.
22. Give me examples of acts of war. For instance, may Ms U sa north korea. Nanalo si A, filipino. Any tax
implications? Assuming wala tayong treaty sa North korea.
23. Incorseementa ni Manny Pacquiao sa Us? Tax?
24. Paano yung boxing na ginawa sa fontana rssort? Pacquiao vs. mexican? Or american? Tax?
25. Cinemas? Kunwari franchise natin?
26. Nagrent si PAL ng eroplano ng isang foreign company. Any tax?
27. Nag exhibit ka ng mona lisa sa museong pambata. Any tax implications?
28. Antonym ng passive?
29. Donut company. International. Nagfranchise si A Company, filipino. Tapos, gusto lahat ng malls sa pinas, meron
nun. Nag sub franchise sila kay A. Tax implicayions?

March 9, 2017
Define and explain gross income
Examples of gross income not included in the enumeration
Is an illegal income taxable as gross income? Legal basis
Is the list of excluded income exclusive?
Can a taxpayer claim deductions for income from illegal source?
What will happen to the illegal income? Will it be confiscated?
Assuming the taxpayer paid the tax for the illegal income and subsequently he got caught, is he still liable to return
the whole income from the illegal source or only the balance?
Tax implications for dividends acquired by: resident citizen, non res alien (engaged and not engaged in trade or
business), domestic corp, non res foreign corp
Pres duterte received a box containing 1B from drug syndicate. Discuss the tax implication.
Is an illegal income subject to local business tax under the local govt code?
Are all kinds of dividends taxable?
Examples of exclusions from gross income
Define improperly accumulated earnings tax. Tax rate.
Exceptions to the imposition of IAET
Why are banks and insurance companies exempted from IAET?
Examples of reasonable needs to be exempted from IAET
1. Mamili ka ng topic, pinili ng classmate ko gross
2. Define gross
3. Enumerate
4. Is illegal income taxable? Why
5. Basis of answer
6. Corporate income tax - dividends dineclare. Stockholders mo ay si Resident citiEn, alien, domestic corpo, foreign.
Tax implications?

7. Bumalik sa illegal income. Dueterte tumaggap ng bribe na 100 million. Taxable?

8. Why? Basis ng tax? Irereport niya?
9. Eh illegal yun? Taxable pa rin? Bakit? Basis
10. Naimpeach siya ng senate. Sabi ng senate ibalik niya 100M eh sabi niya bayad na siya ng 32 milion na tax.
Pwede ba?

11. Reason sa taxability ni duterte sa bribe

12. Paano mo naman sasabihin na hindi dapat itax? Babayaran ka niya ng 100M para maargue mo na hindi siya
magbabayad

13. Corporate tax, balik sa dividends

14. Types of dividends, taxability of each
15. Condominium, binentahan ka ng condo. Installment, 5 years. 20 million. Bayad ka na ng 4 million. Sabi sa
contract to sell, pag namatay ka bago mo mabayaran ang buong 20, opconsidered paid na ang buo. Napunta sa
heirs mo condo. Taxability? Ano to? Donation? Goft?

16. Nagpasa ng bill si manny pacquiao. Delete daw yung life insurance exemption. Pwede ka pa ba magclaim ng
exemption pag life insurance?

17. Binentahan ng baril ang Govt. Russia nagbenta. Taxable?

18. IAET, implications

March 16, 2017

Illegal income
Pwede ba raw icompromise ang mighty corp issue
Fringe benfits formula
Rate ng FBT
Exempt corporations
Pano gagawing compnesation income ang stock options

April 5, 2017
Define fringe benefits tax
Is FBT a tax on employer or employee?
Formula for FBT
Why is it needed to gross-up the monetary value?
Which of the damages under the civil code are taxable and why
Bday gift worth 20k to employees - taxable?
Are minimum wage earners exempt from income tax,
Enumerate the general kinds of deductions
Can a jueteng lord claim for deductions
Pilgrimage tour of profs 1/4 of the expenses - tax implication on professors
Is the basis for optional standard deduction the same for individual and corporation?
What does gross income mean in OSD?
Gross sales vs gross receipts
What is more efficient, to do business as single proprietor or corporation?
Requisites for bad debts deductions
April 20, 2017
Which is more favorable to a taxpayer, to avail the itemized deductions or OSD?
Requisites for bad debts
How to prove that the debt is worthless
Depreciation vs depletion
Discuss the concept of FIFO
Opposite of FIFO
Guidelines for NOLCO
When can a taxpayer start claiming depletion as part of itemized deductions
Requisites for research and development expenses
Examples of taxes that can be deducted from gross income
Two methods of crediting foreign taxes
What is the default method

April 27, 2017

Compare estate tax and donor's tax
Funeral expenses and medical expenses, paano?
If cosmetic surgery, tapos namatay
Tax credit. Manny Pacquiao hypo
Ayaw niya masyado sa transfer taxes, bumabalik siya sa income while nasa transfer taxes kami
In the course of trade and business?
Case of Marubeni
What are the zero rated sales
Hypo each exception
Requisites to be zero rated
Online video transaction here to other country, vatable?
Examples of zero rated services
Exempt transactions – hypo for each
Magazines, exempt?
Review classes, exempt?
Printing of memaid
Lenchong manok exempt? What if with rice?
Dog food?
Check up in the hospital?
Pharmacy?
Hypo about monthly rentals?
What if bed space?
What about sales in the airplane?
Salted egg? Century egg? Boiled egg?
Street foods? Adidas?
Claims against the estate in relation sa mga deductions
Vanishing deductions – concept and yung value ng pwede ideduct following the years
Medical expenses – hypo
Exemption from estate tax
Donor's tax
Gross gifts
Deductions
Gifts made to a charitable/educational etc. maraming hypo or question diyan
Tax rate ng donor's tax
Mas marami siyang tanong sa estate
Nirerelate niya usually sa income tax
Estate tax
Shares of stock question (listed and unlisted) - hypo question
Gross estate
Properties not in the estate
Yung mga transfer in contemplation of death (hypo)
Life insurance proceeds — saan siya kasama
Ordinary deductions – maraming hypo diyan
Judicial expense – hypo questions
Take note yung mga amounts
Claims against the estate in relation sa mga deductions
Vanishing deductions – concept
VAT
Focus ka sa zero rated transactions, yung dalawang classification doon
Tax exempt – dapat at least alam mo yun, nagpa enumerate at least 4
Example ng mga transaction
Yung sa original state ng mga goods, kung kelan sila nawawala sa pagiging original state
Gross selling price v. Gross receipt
Threshold amount t sa VAT
And yung pagtransfer ng properties ng decedent, kelan siya taxable
Highlights ng discussion were: kwekkwek and memaid subject to VAT
As in lahat tinanong niya yun. Basta kabisado mo codal, mabubuhay ka na.
Inuubos niya ba lahat ng on deck? Kasi 26 pa kaming on deck – yup umabot kami ng 11:30 para
lang maubos yung mga on deck
Hindi ko maalala yung sa transfer tax kasi mas nagfocus kami sa VAT. Sa VAT umiikot yung tanong
niya sa zero rated VAT exempt tax credit/tax refund. Tinatanong niya kung yung transaction ba
vatable zero rated or vat exempt.

FINALS
TAX REVIEW

Zero rated tax must necessarily be paid in foreign currency - FALSE

The gross receipts of medical or dental expenses are taxable expenses of purposes of VAT - FALSE (exempt)
Campaign contributions may be deducted from income - FALSE? not deductible - donors
Regional Operational HQ in PH rendered services for research and dvlpt to PH subsidiary and SG subsidiary.
Vatability of 2 billings? PH-Vatable. SG-zero rated?
“in the course of business”
MOA between NBA and PBA where there’s 1M profit for the winning team with a stipulation that 1M will go to
nonprofit indigents. Gross income or donor’s? exempt? Not related to PBA, not ordinary or necessary expense -
cannot be deducted. Excluded in gross income donated to charitable institution. Deductible
Proprietary vs nonstock educational institution
Transactions deemed sales, enumerate, exclusions
Enumerate 4 zero rated sales
Define “capital”cpg truck, antique jar-capital asset?
Enumerate VAT exempt
Requisites for imposition of capital gains
A donated 10M to national government for youth program. Subject to donor’s tax? Rate
Bad debts vs OSD
Foreign currency denominated sale?
Medicine sold to out patients vatable?
Political contributions allowed as deductions?
Bad debts on gross estate recovered after 5 years, still part of gross estate?
T/F Resignation pay given to employee forms part of gross income
Vanishing deductions on gross estate - concept and illustrate
Zero rated vs tax exempt - explain and example
A has lots of real estate worth 1B. A died and is liable for 2M estate tax. Since there were no liquid assets, A’s
spouse, B, sold all the real prop on internet auction with the proceeds of 1B. Proceeds taxable income? Vatable?
Compute for gross income: Salary placed in bank, Honorarium as guest speaker, Monetized vacation leave credit
for 5 days, 13th month pay
Taxability of doctor
Gross receipts of independent doctor accredited by st lukes
Reqts for export sales to be zero rated
Ito pala mga naalala ko na tanong: true or false
1. Yung price daw ba na nakalagay sa transfer document sa sale of condominium unit included na yung vat.
2. A owner ng apartment nagpaparent ng room P22,000 per month. Owner din siya ng dorm P11,000 per month
bayad per person.
2.a. sa apartment gross receipts niya per year P1.6M. Vatable?
2.b. sa dorm gross receipts niya per year 3M. Vatable?
3. Build own transfer - may contractor na nagbabayad sa non stock non profit school para siya magoperate ng
dorm. 30%tax rate?
4. Property dividend given to resident alien managerial employee of an offshore banking unit. 5-32% tax rate?
5. Veterinary clinic vat exempt?
6. Lease of property from alien. Taxable?
Yuny iba di ko na maalala pero may part na codal nalang yung sagot. Nolco. May question din about reckoning
period ng tax refund sa vat vs. Sa income tax. Anyway ang hirap. Good luck!

Additional:
7. Trump corp. an HK corp leased their drone to LGC of Davao. Taxable for income?
8. Fringe benefit tax is always deductible against the employer.
9. Remedies in income tax regarding erroneous payment applicable to vat