1. A non-resident alien not engaged in trade or business in the Philippines is not allowed to claim deductible expenses from gross income.
2. The statement that the taxpayer has the burden of proof in proving expenses is false - for the optional standard deduction, expenses do not need to be proven.
3. A non-resident foreign corporation may avail of the 40% optional standard deduction for income tax purposes.
1. A non-resident alien not engaged in trade or business in the Philippines is not allowed to claim deductible expenses from gross income.
2. The statement that the taxpayer has the burden of proof in proving expenses is false - for the optional standard deduction, expenses do not need to be proven.
3. A non-resident foreign corporation may avail of the 40% optional standard deduction for income tax purposes.
1. A non-resident alien not engaged in trade or business in the Philippines is not allowed to claim deductible expenses from gross income.
2. The statement that the taxpayer has the burden of proof in proving expenses is false - for the optional standard deduction, expenses do not need to be proven.
3. A non-resident foreign corporation may avail of the 40% optional standard deduction for income tax purposes.
1. A non-resident alien not engaged in trade or business in the Philippines is not allowed to claim deductible expenses from gross income.
2. The statement that the taxpayer has the burden of proof in proving expenses is false - for the optional standard deduction, expenses do not need to be proven.
3. A non-resident foreign corporation may avail of the 40% optional standard deduction for income tax purposes.
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Income Tax Quiz 2
Write the letter pertaining to the best answer.
1. Who among the following individual taxpayers is not allowed to claim deductible expenses as a deduction from his gross income? d
a. Non-resident citizen
b. Resident alien
c. Non-resident alien engaged in trade or business in the Philippines
d. Non-resident alien not engaged in trade or business in the Philippines
2. Which of the following statements relative to the optional standard deduction is
false? a
a. The taxpayer has the burden of proof in proving the expenses by means of receipts and other evidence.
b. The 40% deduction rate shall be multiplied to the gross sales or gross receipts in the case of individual taxpayers.
c. The 40% deduction rate shall be multiplied to the gross income in the case of corporate taxpayers.
d. The deduction is claimed ahead of the personal and additional exemptions in the income tax return.
3. Who among the following taxpayers may avail of the 40% optional standard deduction for income tax purposes? d
a. Non-resident alien engaged in trade or business in the Philippines
b. Non-resident alien not engaged in trade or business in the Philippines
c. Resident foreign corporation
d. Non-resident foreign corporation
4. Who among the following individuals may avail of the 40% optional standard deduction for income tax purposes? c
a. A Filipino boxer on his cash prizes from boxing bouts here and abroad
b. A Chinese national permanently residing in the Philippines on his income derived
solely from dividends from domestic corporations and interest from Philippine currency bank deposits
c. A Singaporean who stays in the Philippines for eight (8) months each year on his income from the sale of used vehicles.
d. A Filipino citizen employed in a multi-national oil company in Kuwait.
5. Which of the following expenses may be deducted from gross compensation
income? b
a. Depreciation of permanents assets
b. Premium payments on health and/or hospitalization insurance
c. Bad debts written off
d. 40% optional standard deduction
6. X is a Mexican actor who stayed in the Philippines to do a local television show
for one (1) month during the taxable year. The agreed talent fee amounts to ₱3,000,000. X, however, incurred and paid the following expenses during his stay in the country: d
Hotel accommodation ₱100,000
Transportation expenses 70,000
Miscellaneous personal expense 30,000
The most advantageous deduction that X may avail to minimize his Philippine income tax liability is:
a. Optional deduction of ₱1,200,000 (₱3,000,000 x 40%).
b. Itemized deduction of ₱200,000 (₱100,000 + 70,000 + 30,000).
c. Itemized deduction of ₱170,000 (₱100,000 + 70,000).
d. None of the foregoing.
7. Who among the following individual taxpayers may avail of the itemized deductions for income tax purposes? d
a. Non-resident citizen on his income from sources without the Philippines
b. Resident alien on his income from sources without the Philippines
c. Non-resident alien engaged in trade or business in the Philippines on his income
from sources without the Philippines
d. None of the foregoing
8. One of the following is not a requisite for an expense to be claimed as a
deduction from gross income: b
a. It must be ordinary and necessary.
b. It must be actually paid during the taxable year.
c. It must be connected with the taxpayer’s trade, business or profession.
d. It must be reasonable.
9. Which of the following items is not part of “expenses in general” and, therefore, is not deductible from gross income? c
a. Grossed-up monetary value of fringe benefit furnished by the employer to the
employee b. electricity bill consumed power of the preceding taxable period but not yet actually paid c. unused office supplies d. entertainment expenses 10. Which of the following statements will qualify an interest expense as a deduction from gross income? d a. the indebtedness is incurred to finance the taxpayers residential house. b. the indebtedness is supported by a promissory note that was executed fifteen years ago. c. both a and b d. neither a and b
