Mang Panday wants to determine the taxability of the foregoing. How much is the total amount of passive income which is subject to final tax? A. P690,000B. P540,000C. P530,000D. P500,000 Mang Panday, a resident citizen taxpayer approached you and presented the following-Description2020Basic salaryP800,000Overtime, holiday pays, honorarium and other allowances130,000Non-taxable compensation (not included in the above)90,000Rental income on his apartment for lease150,000Royalty earned from the sale and distribution of his books- Local500,000Dividend earned on his stocks from San Mig, Inc., a domesticcorporation30,000Gross income from a "sideline" store business70,000Interest income earned from his banks savings account-Local banksGross income from online selling of plants10,00090,000Income from the sale of his old car40,000Income from the sale of a farm land he inherited years ago400,000

Passive income is the income which is earned by the taxpayer during the year. It is the form of…

Answered: Mang Panday wants to determine the…

Mang Panday wants to determine the taxability of the foregoing. How much is the total amount of passive income which is subject to final tax?

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter5: Introduction To Business Expenses

Section: Chapter Questions

Problem 62P

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Concept explainers

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.

Question

Mang Panday wants to determine the taxability of the foregoing. How much is the total amount of passive income which is subject to final tax?

A. P690,000

B. P540,000

C. P530,000

D. P500,000

Mang Panday, a resident citizen taxpayer approached you and presented the following-
Description
2020
Basic salary
P800,000
Overtime, holiday pays, honorarium and other allowances
130,000
Non-taxable compensation (not included in the above)
90,000
Rental income on his apartment for lease
150,000
Royalty earned from the sale and distribution of his books- Local
500,000
Dividend earned on his stocks from San Mig, Inc., a domestic
corporation
30,000
Gross income from a "sideline" store business
70,000
Interest income earned from his banks savings account-Local banks
Gross income from online selling of plants
10,000
90,000
Income from the sale of his old car
40,000
Income from the sale of a farm land he inherited years ago
400,000

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