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Last sem False c.

The transfer is for insufficient consideration


1. The value-added tax is not an/a and, hence, not subject to gift tax.
Direct tax 5. False return implies any deviation from truth,
indirect tax whether intentional or not. d. The transfer involves personal property, hence
excise tax not subject to the gift tax.
ad valorem tax True
False 8. The following are included in the gross estate
2. In the case of the decedent who died on of a decedent who died married under the
January 5, 2019. The Following Statements are 6. Momo is engaged in buying and selling of fresh regime of conjugal partnership of gains, except:
correct regarding standard deduction except: fruits at the Blumentritt and Divisoria Markets.
He is also exporting fruit jams to Japan. In 2020, Diamond ring inherited by the decedent's spouse
• A deduction in the amount of P5,000,000 he made a gross sales of P2,500,000. The
shall be allowed as an additional following conclusions are incorrect, except: 9. Rosauro is a CPA lawyer who is currently
deduction without the need for a a. He shall be required to register under the VAT employed as the Chief Financial Officer (CFO) of a
substation. system and shall be subjected to the VAT from the large conglomerate. He regularly earns an
• The full P 5,000,000 shall be allowed as a point of his registration. As such, he may claim annual salary of Php11,990,000 from his
deduction for the decedent's benefit. input VAT on his purchases from VAT suppliers. employment. In addition, he earns professional
fees of Php250,000 from his personal clients.
• The standard deduction is a deduction from b. He may register under the VAT system and be Considering the foregoing, he regularly receives
the marital or community properties of allowed to claim input VAT on his purchases from an amount totaling Php12,240,000 annually. The
married decedents. VAT suppliers. business tax liability of Rosauro shall be:

• The standard deduction is allowed to c. He shall not be required to register under the 3% Other Percentage Tax
decedents whether resident or citizen and VAT system and be allowed to claim input VAT 12% Value-added tax
non-resident aliens. on his purchases from VAT suppliers. Excise Tax
Amusement Tax
3. The taxpayer is given 30 days to submit its d. He may register under the VAT system and will
protest discuss its contention on the findings and not be allowed to claim input VAT on his 10. Ang Sarap Ah Restaurant (ASAR) reported the
provide reconciliation schedules and supporting purchases from VAT suppliers. following sales during the quarter (exclusive of
documents to its arguments. otherwise, the the VAT): Regular Sales of Php500,000; Sales to
assessment becomes final and executory. (section 109) farm product is exempt from VAT Senior Citizens of 80,000; and Sales to Persons
with disabilities of 100,000. The Output VAT of
True 7. Solomon sold his car to Bam. Solomon's car ASAR during the quarter is:
False cost P 300,000 and had a fair market value of P
400,000 at the time of sale. The car was sold for P P60,000
4. A party adversely affected by a resolution of a 200,000. For donor's tax purposes, which of the
division of CTA on a motion for reconsideration following statements is correct? 11. A non-stock and non-profit organization *2/2
or trial may file a petition for review with the operates a variety store. The profit of the said
CTA en banc. A. There is a taxable gift of P 300,000. NSNP does not redound to the benefit of any
person rather it is rolled over to the capital of the
True b. There is a taxable gift of P 200,000. NSNP to fund its charitable purposes. The annual
gross receipts of the NSNP range between P2
million to P2.8 million in the past 3 years. It will 18. The following transactions are subject to the 2019. What percentage of deduction will be used
be liable to the following tax/es: Value-added tax, except: in computing his allowable vanishing deduction?

3%(1% during the period of july 1, 2020- June 30, a. Common carrier by land with respect to their a. 80% of the value taken as a basis of vanishing
2023) OPT gross receipts from the transport of passengers. deduction;
b. Domestic carrier by air and sea on their gross b. 100% of the value taken as a basis of vanishing
12. The following are civil remedies of receipt from their transport of passengers from deduction;
administrative collection available to the BIR, one place in the Philippines to another place in c. 60% of the value taken as the basis of vanishing
except: the Philippines. deduction;
c. Domestic carrier by air and sea on their gross d. 40% of the value taken as the basis for
Filing a tax evasion case against the taxpayer receipt from their transport of passengers from vanishing deduction.
one place in the Philippines to another place
13. The following losses are deductible from the outside of the Philippines. 22. Persons who are exempt from the VAT may
gross estate, except: d. Common carrier by land with respect to their voluntarily register under the VAT system. The
gross receipts from the transport of cargoes and consequences of optional registration are as
b) 2-carat diamond ring reported stolen by the goods. follows, except
decedent, a night before his death;
19. Josefa, who was a Filipino citizen, died on b. Shall be allowed to claim input VAT on all
February 14, 2020, leaving behind a gross estate purchases of goods and services
15. The Commissioner of Internal Revenue shall whose fair market value at the time of her death
have the power to inquire into a taxpayer's bank was P4,000,000. 23. A taxpayer received on January 15, 2020, a
deposit in relation to all internal revenue taxes. Her estate is liable to pay estate tax. final assessment notice for an internal revenue
tax deficiency. On February 10, 2020, he filed a
False False petition for review with the Court of Tax Appeals.
Could the tax court entertain the petition?
16. One of the following does not result in output 20. Marcus, a citizen and resident of Italy, on Assuming an annual gross receipt of
tax: December 25, 2020, donated to his son the Php3,000,000, the following sale of services are
Ferrari car which the latter uses whenever he not exempt from the VAT, except:
a. Domestic sale of goods; visits Italy. The gift was made on account of the
b. Cash receipt on sale of services rendered in the aforementioned son's forthcoming wedding. a. Services of banks, non-bank financial
Philippines Marcus may claim a deduction for dowry on the intermediaries performing quasi-banking
c. Export sale of goods; said gift. functions, and other non-bank financial
d. Cash receipt on sale of services rendered intermediaries.
outside of the Philippines. False
24. In case of a taxpayer who is availing the
17. The assessment becomes final and executory, 21. Sam Ting Wong, citizen and resident of China, remedy of a compromise agreement, the CIR
due and collectible, except: died on October 17, 2020. He left behind, shall be allowed the minimum compromise rate,
included in his gross estate, shares of stocks of for cases other than financial incapacity of the
The taxpayer failed to submit its reply against San Miguel Corporation, a domestic corporation. taxpayer, equivalent to:
the PAN The aforementioned shares of stocks were
inherited by Sam Ting Wong on November 17, d. Forty percent (40%) of the basic assessed tax.
25. For purposes of the VAT, the following are b. The head of the appropriate government office False
embraced by the term goods or properties, and his subordinates with respect to the collection
except: of energy tax. 33. The following are the consequences of issuing
(sec 106) c. Banks duly accredited by the commissioner with a VAT invoice/receipt by a non-VAT registered
a. Real property held primarily for lease in the respect to receipts of payments of internal revenue person, except:
ordinary course of trade or business taxes authorized to be made through banks.
b. Radio, television, satellite transmission, and d. City treasurer with regard to collection of real Shall be liable to a 25% surcharge
cable television time estate tax.
c. The right or the privilege to use motion picture 34. Generally, the following capital assets are
films, films, tapes, and discs 29. Fraudulent return with intent to evade tax subject to donor's tax in case of transfer for less
d. Sales of electricity by generation, transmission, implies intentional deceitful entry with intent to than adequate and full consideration, except:
and/or distribution companies. evade.
a. Real property
26. Cito Yu has a building located in Shorthorn True b. Intangible Property
Quezon City currently leased to at least 50 c. Personal property
tenants. Since he is old already and wants to 30. One of the following is not a transaction d. Tangible property
retire from active business, he sold the same to deemed a sale
Janjan, his son, for 20 million pesos. The value of 35. Felix Buick, at his residence, regularly sells
the building at the time of sale is 40 million a. Transfer use or consumption not in the ordinary wines, whiskies, and cigarettes which he has
pesos. Which of the following statements is course of business, of goods or properties imported from Russia. His annual gross receipt is
correct? originally intended for sale or for use in the course P2,500,000 and he opted for VAT registration, he
of business is liable for the payment of the following taxes:
a. The sale is for sufficient consideration b. Distribution or transfer to shareholders or
b. The sale is for insufficient consideration subject investors of goods or properties as share in the Excise tax, VAT, and income tax.
to donor's tax profits of a VAT-registered person or to creditors
c. The sale is for insufficient consideration but in payment of debt 36. In case of false, fraudulent, and failure to file
exempt from donor's tax since the object is a real c. Retirement from or cessation of business, with a return, a 10-year prescriptive period, which
property respect to inventories of taxable goods on hand as starts to run from the discovery of the falsity,
d. The sale is subject to capital gains tax and of the date of such retirement or cessation fraud or failure to file a return, shall apply.
donor's tax. d. Consignment of goods if actual sale is made True
within 60 days following the date such goods
27 Export sale by a non-VAT registered person is were consigned 37. ABSMNKD, a radio and television franchisee,
exempt from the VAT. (not dapat) reported a gross receipt of Php 15,000,000 for
True the quarter ending December 31, 2020. How
31. The Commissioner of Internal Revenue shall much is the Franchise tax (OPT) liability for the
28. The following are agents and deputies for the have the power to divide the Philippines into said quarter (3%)
collection of National Internal Revenue taxes, zones for purposes of prescribing real property
except: values a. P1,800,000
a. The commissioner of Customs and his True b. 450,000
subordinates with respect to the collection of c. PO
national Internal Revenue Taxes on imported 32. Importations by a non-VAT registered person d. P300,000
goods. is exempt from VAT.
38. False return implies any deviation from truth, True 50. Deedees Merchandising Incorporated
whether intentional or not. filed its 2019 income tax return on March 30,
True 43. False return implies any deviation from truth, 2020. The last day for the BIR to issue to Deedees
whether intentional or not. the Final Assessment Notice is
39. Dodong Kaliwete, Lawyer engaged in the True a. April 15,2023
exercise of his profession, sold his condominium
unit where he and his family reside for Php 44. The Value-added tax is not an/a: 51. A false return was filed on April 15, 1990 and
15,000,000. He purchased said family home for Direct Tax the falsity was only discovered on May 8, 1991.
8,000,000. The value-added tax on the sale is: When is the last day for the BIR to issue the Final
45. In the case of a decedent who died on Assessment Notice
Php 0 January 5, 2018, the following statements are
Php 1,800,000 correct regarding standard deduction, except: May 8, 2001
Php 840,000
Php 450,000 The standard deduction is a deduction from the 52. All of the following are exempt from both
marital or community properties of married the VAT and other percentage taxes, except:
40. For purposes of the VAT, the following are decedents.
embraced by the term goods or properties, b. Sale of goods, services, or importation other
except: 46. As a general rule, the prescriptive period of than those mentioned in paragraphs A to AA of
(read Section 106) assessment of internal revenue taxes shall be section 109 of the Tax Code where the annual
assessed within three (3) years after the last day gross receipts do not exceed P3,000,000.
a. Real property held primarily for lease in the prescribed by law for the filing of the return, or
ordinary course of trade or business where the return is filed within the period, from 53. A Preliminary Assessment Notice shall not be
b. Radio, television, satellite transmission, and the day the return was actually filed. required in any of the following cases, except:
cable television time False
c. The right or the privilege to use motion picture a. When the finding for any deficiency tax is the
films, films, tapes, and discs 47. A party adversely affected by a resolution of result of a mathematical error in the computation
d. Sales of electricity by generation, transmission, a division of the CTA has no other recourse but to of the tax appearing on the face of the tax return
and/or distribution companies. appeal to the Court of Appeals. filed by the taxpayer;
False b. When a discrepancy has been determined
41. The taxpayer is given 30 days to submit its between the tax withheld and the amount actually
protest discussing its contention on the findings 48. Which of the following statements is not remitted by the withholding agent;
and provide reconciliation schedules and true? "The Final Notice Before Seizure c. When a taxpayer who opted to claim a refund or
supporting documents to its arguments. (FNBS) is: tax credit of excess creditable withholding tax for
Otherwise, the assessment becomes final and a. Not considered as a denial of a request for a taxable period was determined to have carried
executory. reconsideration of the disputed assessment over and automatically applied the same amount
claimed against the estimated tax liabilities for the
True 49. Which of the following statements is taxable quarter or quarters of the succeeding
incorrect in connection with family home taxable year;
42. A party adversely affected by a resolution of deduction? d. When the value-added tax due on excisable
a division of the CTA on a motion for Family home deduction may not be lower than articles has not been paid;
reconsideration or new trial, may file a petition P10,000,000 e. When an article locally purchased or imported
for review with the CTA en banc. by an exempt person, such as, but not limited to
vehicles, capital equipment, machinery, and spare Taxpayer should elevate his case to the can after
parts, has been sold, traded, or transferred to non- the lapse of 180 days which is inaction on the part
exempt persons. of Bir to the protest

54. Gavino Sabos, a resident of Japan and citizen


of the United States of America died intestate. A taxpayer received on January 15, 2020, *.../4 a
He left behind estate in France fairly valued at final assessment notice for an internal revenue
the time of his death at Php 15,000,000. He also tax deficiency. On February 10, 2020, he filed a
owned shares of stocks of San Miguel petition for review with the Court of Tax Appeals.
Corporation whose fair value at death was Could the tax court entertain the petition?
Php750,000. The stock certificates of the said
stocks are kept at a safety deposit box in France. No. before he can be allowed to avail judicial
His property in the Philippines valued at death is remedies, he must first exhaust administrative
P45,000,000. Mr. Sabos' gross estate for estate remedies. It is the commissioner's inaction (180
tax purposes shall be: days) or decision on the protest that gives the tax
court jurisdiction over the case provided that the
Php 45.750,000 appeal is filed within 30 days from receipt of the
commissioner's decision or 180 days from
essay: submission of the protest.
14. Keno Lecta, on January 19, 2019, submitted
his protest, by way of a Motion for
Reconsideration, against the final assessment
notice (FAN) issued against him. 180 days have
already passed and he was not able to elevate his
case to the Court of Tax Appeals within the
statutory 30-day period after the aforesaid 180
days. The BIR issued the warrant of distraint and
levy against him alleging that the FAN has
already become final and executory on account
of his failure to appeal to the CTA within the 30-
day period after the lapse of the
abovementioned 180 days. Is the BIR correct?
Explain your answer and include available
remedies/ies of Mr. Lecta, if any.
No. The taxpayer can still lodge his appeal to the
CTA within 30 days from his receipt of the Warrant
of Distraint. He will consider this act of the BIR as
the resolution to his protest after he has 30 days
to protest the
СТА.
Raisa 5. The decedent died leaving behind 500 shares be added to the gross estate in the course of
1. Which shall not form part of the gross estate of stocks of Honda Yapapa, a domestic filing the estate tax return
of a decedent: 2PTS corporation traded in the Philippine Stock
Exchange. On the day of the decedent's death, TRUE
A. intangible personal property of a non-resident the price per share of the said stocks traded on FALSE
alien without reciprocity law the following amounts: P24, P24.75, P23.50, and section 97
B. Transfer under a special power of appointment P25. The amount to be included in the gross
C. Life insurance proceeds where the executor is estate of the decedent for the said shares should 10. Real property held as a capital asset,
the beneficiary and it is irrevocable be: transferred for insufficient consideration shall be
D. Revocable transfer included in the gross gift.
Sec 85 Gross Estate A. P12,156
TRUE
2. Estate tax is governed by the law prevailing at B. P11,750 FALSE
the time of distribution of the properties to the
heirs. 2PTS C. P12,500 11. A subdivision developer sold five (5)
TRUE residential houses and lots, each to different
FALSE D. P12,250 vendees, for P2,000,000 per lot, or a total sale of
P10,000,000 for the taxable period. These sales
shall be classified as:
3. Estate Tax is governed by the law prevailing at 6. Beginning January 1, 2018, in donor’s tax, the
the time of death of the decedent. exemption is P 250,000 while in estate tax it is P A. 12% VAT transactions
TRUE 100,000 TRUE B. 0% VAT transactions
FALSE FALSE C. VAT-exempt transactions
train law D. None of the foregoing
Sec.3
7. A Japanese national residing in Hong Kong shall 12. The following losses are deductible from the
4. The reciprocity rule, which determines whether be taxable based on its worldwide estate. gross estate, except: *
or not the intangible properties of a decedent will
be included in the gross estate, shall not apply to TRUE A. Car donated mortis causa, struck by lightning 2
the following, except 2PTS FALSE hours after the decedent’s death;

A. A Japanese national residing in Malolos, 8. Donor’s tax is a tax imposed on a person’s B. 2-carat diamond ring was reported stolen from
Bulacan. exercise of his right to gratuitously dispose of his the decedent, 2 nights before his death
property during his lifetime without regard to the
B. A resident and citizen of the United States of donee. C. Php50,000 cash in the bank of the decedent,
America. reported stolen to the BIR 30 days after the
TRUE decedent’s death
C. A Filipino residing in Paris, France. FALSE
D. A diamond necklace fairly valued at the time of
D. An American national residing in Yokohama 9. Cash in the bank, withdrawn within 1 year the decedent’s death at Php2,000,000. It was
Japan. from the death of the decedent, and subjected to reported stolen, 45 days after the decedent’s
the 6% withholding tax, is no longer required to death. The diamond necklace was insured
whereby the insurance company paid 200,000. For donor’s tax purposes, which of the B. P990,000
Php1,500,000 to the estate, due to the loss of the following statements is correct? C. 0
diamond necklace. D. 3,000,000
A. There is a taxable gift of P 300,000.
13. For a decedent who died on March 15, 2021, B. There is a taxable gift of P 200,000. 19. Estate tax returns showing a gross estate
the following are allowed as actual funeral C. The transfer is for insufficient consideration exceeding a value of Php5,000,000 shall be
expenses, except: and, hence, not subject to gift tax. supported with a statement duly certified by a
D. The transfer involves personal property, hence Certified Public Account:
A. Mourning clothes of the immediate family; not subject to gift tax.
B. Cost incurred in burial rites; TRUE
C. Cost of upkeep of the family mausoleum; 17. The following are transfers exempt from FALSE
D. Cost of an obituary notice. transfer tax, except * sec 90 (a-3 provided)
E. None of the above
A. Transmission from the first heir or donee in 20. A Japanese national residing in Hong Kong
14. The list provided below is excluded from the favor of another beneficiary in accordance with shall be taxable based on worldwide estate.
gross estate, except: the desire of the predecessor TRUE
FALSE
A. Exclusive property of the surviving spouse; B. Transmission or delivery of the inheritance or
B. Properties outside the Philippines of a non- legacy by the fiduciary heir or legatee to the 21. The following are taxable with their worldwide
resident alien decedent fideicommissary donations, except:
C. Intangible personal property outside of the
Philippines of non-resident aliens when the rule of C. The merger of usufruct in the owner of the A. American residing in Mexico, Pampanga
Reciprocity applies. naked title. B. Filipino residing in Gapan, Nueva Ecija
D. Share of the surviving spouse in the C. Chinese residing in Miami, Florida
conjugal/community properties D. All bequests, devices, legacies, or transfers to D. Filipino residing in Chile
social welfare, cultural, and charitable
15. The following are characteristics of estate institutions 22. Arnaldo, a citizen and resident of China, died
taxation of a non-resident alien, except: on October 17, 2020. He left behind included in
(Sec 87) Provided that not more than 30% of the his gross estate shares of stocks of San Miguel
A. The gross estate shall comprise properties said bequest or transfer shall be used by such Corporation, a domestic corporation. The
located within the Philippines only. institutions for administration purposes. aforementioned shares of stocks were inherited
by Arnaldo on November 17, 2019. What
B. Not allowed to claim family home deductions 18. In January 2021, James received a piece of percentage of deduction will be used in computing
land with a fair market value of P1,000,000 from his allowable vanishing deduction?
C. Not allowed to claim vanishing deductions. his wealthy best friend (a lawyer) as a birthday
gift. Since James had no use of the said donated A. 80% of the value taken as the basis of vanishing
D. Allowed deduction for expenses, losses, land he immediately sold it to Jake for only deduction;
indebtedness, taxes, etc P500,000. How much is the gross gift that the B. 100% of the value taken as the basis of the
wealthy best friend had to report in his donor’s vanishing deduction
16. John sold his car to Sam. John’s car cost P tax return? C. 60% of the value taken as the basis of vanishing
300,000 and had a fair market value of P 400,000 deduction;
at the time of sale. The car was sold for P A. P497,000
D. 40% of the value taken as basis for vanishing D. Subject to VAT because it is considered an D. An Aston Martin sports car which the decedent
deduction. actual sale bought while he was in London, England, and
section 86(5) onboard a shipping vessel on international waters
27. For donations made after January 18, 2019, at the time of his death.
23. For donations made on March 29, 2019, the when the donee or beneficiary is a stranger, the
tax rates for donor’s tax are lower than those for tax payable by the donor shall be: 30. The following are inclusions in the gross
estate tax ( in case of a decedent who died estate of the decedent, except
during the same day), in all cases: A. 6 % of the gross gifts.
B. 6% of the net gifts. A. Donation mortis causa
TRUE C. based on the graduated rates with the first P B. Donation inter vivos
FALSE 100,000 net gift exempt. C. Transfer in contemplation of death
D. Based on the graduated rates with the first D. Transferred to the decedent under general
24. The Commissioner or any Revenue Officer P100,000 net gift exempt or 30 % of the net gifts power of appointment
authorized by the former, shall have the whichever is higher.
authority to grant in meritorious cases, a 31. For donations made beginning January 1,
reasonable extension to file, not exceeding thirty 28. The heirs are allowed to withdraw from the 2018, whether the donee or beneficiary is a
(30) days, for filing the estate tax return. decedent’s bank account without presenting stranger, the tax payable by the donor shall be 6
proof of payment of the estate tax, i.e., eCAR % of the gross gifts:
TRUE issued by the CIR or his duly authorized
FALSE representative, provided the withdrawal will be TRUE
subjected to a final withholding tax of six percent FALSE
25. Mr. A died, leaving a house and a lot to Mr. B, (6%) of the amount to be withdrawn. net gifts
on March 31, 2018, which was questioned by Mr.
C. It is under litigation but the parties have TRUE 32. The estate tax return shall be filed within one
started an extra-judicial settlement. The last day FALSE (1) year from the approval by the Court of the
for filing the estate tax return is: Section 97 project of partition of the estate.

A. April 30, 2018 29. The following properties are included in the TRUE
B. April 30, 2019 gross estate of a decedent who was a resident of FALSE
C. March 31, 2019 the Philippines and a citizen of Japan, except
D. October 30, 2019 33. Three of the following are included in gross
A. Shares of stocks of Abaca Corp, a foreign gift for donor's tax purposes, except:
26. Mr. Logan, a VAT-registered real estate corporation with 75% business in the Philippines.
dealer, transferred a parcel of land held for sale A. P 200,000 cash was given by a resident alien
to his Fiancee, Elizabeth, as a gift on account of B. Residential lot in Ayala Alabang transferred to donor to his legitimate son who is getting married
her graduation. For VAT purposes, the transfer is: his son, for a consideration equivalent to the lot’s in the Philippines to a Filipina.
fair market value, prior to the decedent’s death.
A. Not subject to VAT because it is a gift B. P 10,000 cash given by a resident alien donor to
B. Subject to VAT as deemed sale transaction C. Patent arising from the decedent’s invention of his legitimate son who is getting married in the
C. Not subject to VAT because by reason of the heat insulator used by Starbucks on all coffee Phils.
gratuity. cups that the latter serves.
C. Donation of a condominium in Hong Kong to a E. The purchaser in whose favor the VAT C. The total value of the family home must be
Filipina by a British national not residing in the invoice/receipt was issued, shall be allowed to included as part of the gross estate of the
Phils. claim input VAT thereon. decedent.

D. P 150,000 donation to a nonprofit school D. Allowable deduction must be in an amount


whereby 31% will be used for administrative equivalent to the current fair market value of the
purpose by the donee institution.. 37. As one of the properties whereby the family home as declared or included in the gross
decedent exercises the owner’s interest, proceeds estate, or to the extent of the decedent’s interest
34. For purposes of filing the donor’s tax return, of life insurance, on the life of the decedent are (whether conjugal/community or exclusive) but
the deadline for filing from the day of donation is: generally included in the gross estate, except not exceeding Php1,000,000.

A. 30 days A. Beneficiary is the estate, executor, or 39. Which is incorrect? *


administrator and the designation of the
B. 1 month beneficiary on the life insurance policy is A. A taxpayer whose annual gross receipts or sales
revocable exceed Php3,000,000 shall pay VAT even if not
C. 60 days VAT registered.
B. Beneficiary is the estate, executor, or
D. 9 months administrator and the designation of the B. A taxpayer whose annual receipts or sales do
beneficiary on the life insurance policy is not exceed Php3,000,000 but who is VAT
35. In case of insufficiency of cash, the estate tax irrevocable; registered shall pay VAT.
may be paid in installments within Five (5) years
from the date of filing of the estate tax return. C. Beneficiary is any person other than the estate, C. A non-resident lessor or foreign licensor who is
(2years) executor, or administrator and the designation of not VAT-registered is subject to VAT
the beneficiary is revocable;
TRUE D. An individual taxpayer whose gross sales or
FALSE it should be 2 years D. Beneficiary is other than the estate, executor, receipts do not exceed P100,000 is exempt from
or administrator and the designation of the VAT provided he pays the 3% other percentage
36. The following are the consequences of issuing beneficiary is irrevocable. tax.
a VAT invoice/receipt by a non-VAT registered
person, except 38. In the case of a decedent who died on 40. Estate tax is a tax imposed on a person’s
February 14, 2020, the following are the exercise of his right to gratuitously dispose of his
A. Shall be liable to the percentage tax thereon, if conditions for deductibility of the family home, property upon his death.
any except
TRUE
B. Shall be liable to the 12% VAT A. The family home must be the actual residence FALSE
of the decedent and his family at the time of his
C. Shall not be allowed to claim input VAT thereon death certified as such by the Barangay Captain of 41. The following are intangible properties in the
the locality where the family home is located. Philippines, except
D. Shall be liable to a 25% surcharge (50%
surcharge) B. The decedent must be a resident or citizen of A. Franchise which must be exercised in the
the Philippines. Philippines
B. Shares, obligations or bonds issued by any FALSE
corporation or sociedad anonima organized or D. P360,000
constituted in the Philippines in accordance with 47. Which statement is wrong;
its laws 44. The following properties are intangible
properties located in the Philippines, except: A. Claims against an insolvent person should be
C. Shares, obligations or bonds issued by any included in the gross estate even if uncollectible
foreign corporation sixty-five percent (65%) of A. Shares of stocks of Microsoft Corporation, a
the business of which is located in the Philippines USA-incorporated corporation. B. Transfer passing under a special power of
(85%) appointment is excluded from the gross state.
B. Franchise to operate a cellular phone network
D. Shares, obligations, or bonds issued by any in the entire Philippines. C. Revocable transfers are includible whether or
foreign corporation if such shares, obligations or not the right to revoke is exercised.
bonds have acquired business situs in the C. Shares of stocks of Cisco Networks which
Philippines established a sales office in the Philippines. D. Transfer in contemplation of death for
adequate consideration is still includible in the
E. Shares or rights in any partnership, business or D. Shares of Stocks of Burubur Inc., a Japanese gross estate.
industry established in the Philippines corporation whose 90% of gross income is sourced
from the Philippines
42. A donation inter vivos due to thought of
death is: 45. Persons who are exempt from the VAT may 48. The Commissioner, for any reason he may see
voluntarily register under the VAT system. The fit, may extend the time for payment of the estate
A. Subject to donor’s tax. consequences of optional registration are as tax not to exceed five (5) years in case the estate
follows, except is being settled through the courts, or two (2)
B. Subject to inheritance tax. years in case the estate is being settled out of
A. Shall be allowed to claim transitional input VAT court.
C. Subject to estate tax if for inadequate during the first year of VAT registration
consideration TRUE
B. Shall be allowed to claim input VAT on all FALSE
D. Subject to estate tax a bonafide transfer purchases of goods and services
49. One of the following is a conjugal property of
43. In January 2021, James received a piece of C. Shall be required to submit a monthly VAT the spouses *
land with a fair market value of P1,000,000 from declaration and quarterly VAT return
his wealthy best friend as a birthday gift. Since A. That which is purchased with the exclusive
James had no use of the said donated land he D. Optional VAT registration shall be irrevocable property of the wife
immediately sold it to Jake for only P500,000. How for three years from the quarter the election was
much is the total tax liability of James? made ( forever for radio and television networks) B. The fruits of an exclusive property

A. P 150,000 46. Any amount paid after the statutory due date C. That which is acquired during marriage by
of the tax, but within the extension period, shall inheritance
B. P210,000 be subject to interest but no surcharge.
D. That which is brought to the marriage as his or
C. P 60,000 TRUE her own.
from elena clinic facilities. All amounts given are exclusive of 4%
the VAT. His output VAT for the month is. *
2%
1. An insolvent company had an outstanding
obligation of P l00,000.00 from a creditor. Since it Php90,000 0%
could not pay the debt, the creditor agreed to Php42,000
Php48,000 7. Export sales by a VAT-registered person shall
accept payment through dacion en pago a
Php80,357 be subjected to the 0% VAT. On the other hand,
property that had a market value of P30.000.00.
export sales by a non-VAT registered person shall
In the dacion en pago document, the balance of 4. Why are donations mortis causa subject to be VAT exempt and subject to the 3% other
the debt was condoned. estate tax? explain your answer. percentage tax. *
Donation mortis causa acceptance is made only True
A. What is the tax effect on the discharge of the
after the donor’s death because they partake of
unpaid balance of the obligation on the debtor False
the nature of a will and are thus governed by the
corporation?
rules on succession. 8. ABSMNKD, a radio and television franchisee,
The unpaid balance of 70,000 which was and estate tax happen when gratuitous reported a gross receipt of Php15,000,000 for the
condoned is excluded from gross income under quarter ending December 31, 2020. How much is
5. Is the approval of the court, sitting as probate the Franchise tax (OPT) liability for the said
section 28 b of the NIRC. This is because of the
or estate settlement court, required in the quarter *
fact arising from the pure liberality of the
enforcement and collection of estate tax? Explain.
creditor. it was not an income because it was not a. P1,800,000
*
gain derived from capital, from labor, or from
both combined. The approval of the court sitting in probate is not b. P450,000
a mandatory requirement in the collection of c. P0
2. Aileen, a VAT-registered person, bought estate taxes." "In case of failure to file a return,
garments from CUA Corp., likewise a VAT- the tax may be assessed at any time within 10 d. P300,000
registered person. She bought the goods from years after the omission." 9. Lolo Sot, 95 years old, had been suffering from
CUA Corp at Php90,000 and she was able to various ailments. Motivated by the thought of
6. Victron had dinner with Donnabelle on
export the said goods at a sale price of death, he decided to dispose of all his properties
December 27, 2017. During said dinner, the
Php100,000. Both amounts given are exclusive of to his children and relatives. He executed a last
platinum nose ring, fairly valued then at
the VAT. The output VAT on Aileen’s export sale will and testament disposing all his properties in
Php375,000, which Victron was wearing caught
is: * Donnabelle’s attention. She was very much the Philippines to his children. On the same day,
fascinated with the same. In order to impress he made donations inter-vivos to his other
a. Php1,200
Donnabelle, Victron offered to give the nose ring relatives as to his properties in the United States.
b. Php12,000
to Donnabelle which the latter accepted. They Lolo Sot died three months after disposing of all
c. Php0, because subject to 0% VAT;
agreed to have it cleaned by Victron first and they his properties. Should the properties donated by
d. Php0, because exempt.
will meet again on January 1, 2018. On the said Lolo Sot to his other relatives be included in his
3. Dr. Albert Rebosa, a VAT registered ob-gyne appointed day, Victron had the nose ring gross estate upon his death? *
specialist, owns a maternity-lying-in clinic. During delivered to Donnabelle, and the Deed of a. No, because they were not his properties
the Month his clinic received payment totaling donation along with the deed of acceptance were anymore at the time of death.
P750,000, broken down as follows: P350,000 as likewise executed on the said day. The applicable
Dr. Rebosa’s professional fee; and P400,000 as donor's tax rate is: * b. Yes, because the donations were donations
payment for the use of his maternity lying-in- mortis causa and should be governed by the rules
6% on estate taxation.
c. No, if the donor’s tax had been paid already on a. He shall be required to register under the VAT 14. An insolvent company had an outstanding
the donations. system and shall be subjected to the VAT from obligation of P l00,000.00 from a creditor. Since it
the point of his registration. As such, he may could not pay the debt, the creditor agreed to
d. No, because they were not transfers in
claim input VAT on his purchases from VAT accept payment through dacion en pago a
contemplation of death, since the donations were
suppliers. property which had a market value of P30.000.00.
not simultaneous with the execution of the last
In the dacion en pago document, the balance of
will and testament. b. He may register under the VAT system and be
the debt was condoned.
allowed to claim input VAT on his purchases from
9. In the case of a decedent who died on January
VAT suppliers. Insofar as the creditor is concerned, how is he
5, 2018, the following statements are correct
effected tax-wise as a consequence of the
regarding standard deduction, except: * c. He shall not be required to register under the
transaction? *
VAT system and be allowed to claim input VAT
a. A deduction in the amount of P5,000,000 shall
on his purchases from VAT suppliers. The creditor is subject to the donor’s tax as the
be allowed as an additional deduction without
amount condoned excluded the P50,000
the need for substantiation. d. He may register under the VAT system and will
exemption for gift tax.
not be allowed to claim input VAT on his
b. The full amount of P5,000,000 shall be allowed
purchases from VAT suppliers.
as a deduction for the benefit of the decedent.
14. Which of the following life insurance proceeds
12.. A non-stock and non-profit organization
c. Standard deduction is a deduction from the shall not be included in the computation of gross
operates a variety of stores. The profit of the said
conjugal or community properties of married estate? *
NSNP does not redound to the benefit of any
decedents.
person rather it is rolled over to the capital of the a. Beneficiary is the estate, executor or
d. Standard deduction is allowed to decedents NSNP to fund its charitable purposes. The annual administrator and the designation of the
whether resident or citizen and non¬resident gross receipts of the NSNP range between P2 beneficiary is revocable;
aliens. million to P2.8 million in the past 3 years. It will
b. Beneficiary is the estate, executor or
be liable to the following tax/es: *
administrator and the designation of the
10. The list provided below is exempt from gross a. 3% OPT beneficiary is irrevocable;
estate, except: * b. 0%-35% income tax c. Beneficiary is other than the estate, executor or
a. Share in common properties of the surviving administrator and the designation of the
c. 8% optional income tax
spouse; beneficiary is revocable;
d. 30% regular corporate income tax
d. Beneficiary is other than the estate, executor
b. Exclusive property of the surviving spouse;
13. Sebastian Vettel, a professional race car or administrator and the designation of the
c. Properties outside the Philippines of a non- driver, sold 1,000 shares of stocks of ABA Rice Mill beneficiary is irrevocable.
resident alien decedent; Inc., a domestic corporation, to his teammate
15. One of the following does not result in
d. Intangible personal property in the Philippines Charles for P85,000. The stocks had a cost to him
output tax: *
of a non-resident alien when the rule of of P100,000. The tax on this transaction shall be.
Reciprocity applies. * a. Domestic sale of goods;

11. Momo is engaged in buying and selling of Value-added tax b. Cash receipt on sale of services rendered in the
fresh fruits at the Blumentritt and Divisoria Philippines
Stock transaction tax
Markets. He is also exporting fruit jams to Japan. c. Export sale of goods;
Capital Gains tax
In 2020, he made a gross sales of P2,500,000.
The following conclusions are incorrect, except * Excise tax
d. Cash receipt on sale of services rendered The following are subject to the excise tax, as c. Shall not be allowed to claim input VAT thereon
outside of the Philippines. business tax, except *
d. Shall be liable to 25% surcharge (50%)
a. Manufacturing and importation of cigar,
e. The purchaser in whose favor the VAT
cigarette, and tobacco products;
16. Banks are subject to VAT on their interest invoice/receipt was issued, shall be allowed to
income * b. Manufacturing and importation of wine, claim input VAT thereon.
whisky, and fermented spirits
True The Commissioner, for any reason he may see fit,
c. Manufacturing and importation of may extend the time for payment of the estate
False
automobiles tax not to exceed five (5) years in case the estate
In case of insufficiency of cash, the estate tax may is being settled through the courts, or two (2)
d. Non-invasive cosmetic surgery
be paid in installments within two (2) years from years in case the estate is being settled out of
the date of filing of the estate tax return. * Victron had dinner with Donnabelle on December court. *
27, 2017. During said dinner, the platinum nose
True True
ring, fairly valued then at Php375,000, which
False Victron was wearing caught Donnabelle’s False
attention. She was very much fascinated with the
In case the available cash of the estate is In case of VAT-exempt goods sold locally to a
insufficient to pay the total estate tax due, same. In order to impress Donnabelle, Victron
VAT-registered customer, the VAT due on such
offered to give the nose ring to Donnabelle which
payment by installment shall be allowed within product shall be allowed as input VAT creditable
the latter accepted. They agreed to have it
two (2) years from the statutory date for its against output VAT of the said customer. *
payment without civil penalty and interest upon cleaned by Victron first and they will meet again
on January 1, 2018. On the said appointed day, True
approved by the concerned BIR Official
Victron have the nose ring delivered to
False
The following losses are deductible from the Donnabelle and the Deed of donation along with
gross estate, except: * the deed of acceptance were likewise executed The following are the mandated information in a
on the said day. The taxable net gift amounts to: VAT invoice or VAT official receipt, except: *
a) Car donated mortis causa, struck by lightning 2
hours after the decedent’s death; * a. TIN of the seller and a statement he is VAT
Php275,000 registered
b) 2 carats diamond ring reported stolen by the
decedent, a night before his death; Php125,000 b. The total amount that the purchaser pays or is
obligated to pay with the indication that such
c) Php50,000 cash in bank of the decedent, Php375,000 amount includes the VAT
reported stolen to the BIR 30 days after the
decedent’s death; Php187,500 c. The amount of VAT is shown as a separate item
in the invoice or receipt
d) A diamond necklace fairly valued at the time of
the decedent’s death at Php2,000,000. It was The following are the consequences of issuing a d. If the same is VAT exempt or VAT Zero-rated, it
reported stolen, 45 days after the decedent’s VAT invoice/receipt by a non-VAT registered shall be printed or written prominently in the
death. The diamond necklace was insured person except,: * invoice or receipt
whereby the insurance company paid
a. Shall be liable to the percentage tax thereon, if e. In case of mixed sales in the same invoice or
Php1,500,000 to the estate, due to the loss of the
any receipt, it shall indicate the breakdown, which is
diamond necklace.
vatable, zero-rated, and/or exempt. Seller
b. Shall be liable to the 12% VAT
should not issue separate invoices for the d. The sale is subject to capital gains tax and d. Optional VAT registration shall be irrevocable
aforementioned components of the sale. donor’s tax. for three years from the quarter the election was
made ( forever for radio and television networks)
Basilio is a CPA lawyer who is currently employed A, an individual, sold to B (brother-in-law) his
as the Chief Executive Officer (CEO) of a large residential lot with a market value of P1,000,000 Presumptive input VAT shall be available to the
conglomerate. He regularly earns a total salary of for P600,000.00. A’s cost in the lot is processor or manufacturer, as the case may be,
Php11,990,000 from his employment. In addition, P100,000.00. B is financially capable of buying of the following, except: *
he earns professional fees of Php250,000 from his the lot. What tax should be imposed and
Sardines
personal clients. Lastly, he is VAT registered. collected from A as a result of the transaction? *
Considering the foregoing, he regularly receives Tuna
a. Capital gains tax
an amount totaling Php12,240,000 annually. The
refined sugar
business tax liability of Basilio shall be: * b. Donor’s Tax
noodle-based instant meal
a. 3% Other Percentage Tax c. Real property Tax
The following are transactions and acquisitions
b. 12% VAT d. Capital gains tax and Donor’s Tax
exempt from transfer tax, except *
c. Excise tax The following are the requisites for vanishing
a. Transmission from the first heir or donee in
deduction to be allowable, except one. *
d. None favor of another beneficiary in accordance with
a. The estate tax of the prior succession must the desire of the predecessor
The following are business taxes under the
have been finally determined and paid.
National Internal Revenue Code, except: * b. Transmission or delivery of the inheritance or
b. The present decedent died within five (5) years legacy by the fiduciary heir or legatee to the
a. Value-added tax
from the date of death of the prior decedent. fideicommissary
b. Other Percentage tax
c. The property with respect to which deduction c. The merger of usufruct in the owner of the
c. Excise tax on manufacturing and importation is sought can be identified as having been naked title
received by the present decedent from the prior
d. Documentary stamp tax d. All bequests, devices, legacies, or transfers to
decedent.
social welfare, cultural, and charitable
Cito Yu has a building located in Shorthorn
d. The property must have formed part of the institutions
Quezon City currently leased to various tenants.
gross estate situated outside the Philippines of
Since he is old already and wants to retire from The estate tax is determined by multiplying 6%
the prior decedent.
active business, he sold the same to Janjan, his of: *
son, for 20 million pesos. The value of the Persons who are exempt from the VAT may
a. Gross estate within and outside of the
building at the time of sale is 40 million pesos. voluntarily register under the VAT system.
Philippines of a decedent who was Chinese and a
Which of the following statements is correct? * Among the consequences of optional
resident of the Philippines.
registration are as follows, except *
a. The sale is for sufficient consideration
b. Net taxable estate within the Philippines of a
a. Shall be allowed to claim transitional input VAT
b. The sale is for insufficient consideration decedent who was a resident and citizen of
during the first year of VAT registration
subject to donor’s tax China.
b. Shall be allowed to claim input VAT on all
c. The sale is for insufficient consideration but c. Gross estate within the Philippines of a
purchases of goods and services
exempt from donor’s tax since the object is a real decedent who was a resident and citizen of China.
property c. Shall be required to submit a monthly VAT
declaration and quarterly VAT return
d. Net taxable estate within and outside of the fascinated with the same. In order to impress 100,000 The output VAT of ASAR during the
Philippines of a decedent who was a resident and Donnabelle, Victron offered to give the nose ring quarter is: *
citizen of China. to Donnabelle which the latter accepted. They
a. P60,000
agreed to have it cleaned by Victron first and
Part of the estate left by A are preferred shares
they will meet again on January 1, 2018. On the b. P81,600
of MERALCO. The shares are listed and traded on
said appointed day, Victron have the nose ring
the Philippine Stock Exchange. Which of the c. P69,600
delivered to Donnabelle and the Deed of
following rules of valuation is correct? *
donation along with the deed of acceptance d. P72,000
a. The preferred shares will be valued using the were likewise executed on the said day. The last The following sale of services are generally not
arithmetic mean between the highest and lowest day for filing and payment of donor's tax is on. * exempt from the VAT, except: *
quotation at the date nearest the date of death
January 26, 2018 a. Services of banks, non-bank financial
if none is available on the date of death itself.
February 25, 2018 intermediaries performing quasi-banking
b. The preferred shares will be valued based on
functions, and other non-bank financial
their book value. January 30, 2018 intermediaries. (exempt Sec 109)
c. The preferred shares will be valued based on February 14, 2018 b. Services rendered by doctors of medicine duly
their par value. registered with the professional Regulatory
Felix Buick, at his residence, regularly sells
d. The preferred shares will be valued based on wines, whiskies, and cigarettes which he has Commission.
their fair market value as determined by the imported from Russia. His annual gross receipt is
c. Services rendered by lawyers duly registered
Commissioner of Internal Revenue P2,500,000 and he opted for VAT registration, he
with the Integrated Bar of the Philippines.
is liable for the payment of the following taxes: *
Sebastian Vettel, a stock dealer, sold 1,000 d. Foreign artist performing in a one-night
shares of stocks of ABA Rice Mill Inc., a domestic a. Excise tax, VAT and OPT. concert in the Philippines.
corporation, directly to his friend Charles. The
b. Excise tax, VAT and income tax. Sebastian Vettel, a professional race car driver,
tax on this transaction is: *
c. VAT, OPT and income tax. sold 1,000 shares of stocks of ABA Rice Mill Inc.,
Value-added tax a domestic corporation, through the Local Stock
d. Excise tax, income tax and amusement tax.
Stock transaction tax Exchange. The tax on this transaction is: *
The following are characteristics of estate
Capital gains tax Value-added tax
taxation of a non-resident alien, except: *
Excise tax Stock Transaction Tax
a)The gross estate shall comprise of properties
The sale of gold to the BSP is exempt from the located within the Philippines only. Capital Gains tax
VAT. * Excise tax
b) Not allowed to claim family home deductions.
True A non-vat registered person who issues a VAT
c) Not allowed to claim vanishing deductions.
False receipt on a given transaction is subject to the
d) Allowed deduction for expenses, losses,
VAT on the said transaction. *
Victron had dinner with Donnabelle on indebtedness, taxes, etc.
December 27, 2017. During said dinner, the True
Ang Sarap Ah Restaurant (ASAR) reported the
platinum nose ring, fairly valued then at
following sales during the quarter (exclusive of False
Php375,000, which Victron was wearing caught
the VAT)Regular Sales Php500,000 Sale to Senior
Donnabelle’s attention. She was very much
Citizens 80,000 Sale to Persons with disabilities
Romualdo is an MD-Lawyer who is currently
employed as the Chief Executive Officer (CEO) of
a large Pharmaceutical Company. He regularly
earns a total salary of Php11,990,000 from his
employment. In addition, he earns professional
fees of Php250,000 from his personal clients. In
the first quarter of the current taxable year, he
opted to pay the 8% preferential income tax.
Considering the foregoing, he regularly receives
an amount totaling Php12,240,000 annually. The
business tax liability of Romualdo shall be: *
a. 3% Other Percentage Tax
b. 12% VAT
c. Excise tax
d. None
Cash in the bank, withdrawn within 1 year from
the death of the decedent, and subjected to the
6% withholding tax, is no longer required to be
added to the gross estate in the course of filing
the estate tax return. *
True
False

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