Income Taxation

• Generally, all non-resident tax payer is subject to final tax.

  True
• Resident citizens are subject to final income tax whether earned within or without the Philippines.

  False
• Only interest accruing from local currency bank deposits, deposit substitutes, or trust funds are subject to Final Tax.


  False
• Pursuant to the 19 lender rule, to be considered as a deposit substitute, there must be at least 19 lenders at any one time.

  False
• All inter-corporate dividends are tax exempt.

  False
• PSCO winnings not exceeding 10,000 are tax-exempt.

  True
• Tax sparring rule applies only to Non-Resident Foreign Corporation

  True
• Royalties, active or passive earned from sources abroad are subject to regular income tax.

  True
• All business assets are ordinary assets.


  False
• Stock Transaction Tax is imposed in lieu of the Capital Gains Tax if the sale of stock happens in the PSE.


  False
• Capital Gains Tax is a universal tax which means that even non-residents not engaged in trade or business tax payer are liable for such type of tax.

  True
• Tax basis of stocks for purposes of computation of CGT when it is previously donated to a taxpayer is the fair market value at the time of the gift.

  False
• Whether the transaction results in a gain /loss, CGT is imposed on a sale of domestic stocks directly to the buyer as income is always presumed.

  False
• Sale of real property classified as capital assets in the Philippines is subject to 6% CGT.


  True
• Real properties can be transferred to their new owner even without the payment of the required capital gains tax.

  False
• 6% of Capital Gains Tax applies only to individual taxpayers.

  False
• To apply alternative taxation in case of the sale of real property classified as a capital asset, the seller must be an individual and the buyer is the government.

  True
• Sale, exchange, and other disposition of a residential lot for the acquisition of a new principal residence by individual taxpayer is exempt from CGT.

  False
• Acquisition of the new principal residence must succeed the sale of principal principal residence to be exempt.

  True
• Sale of socialized housing by the NHA are exempt from CGT.

  True