P3.

1
Subject to FBT Subject to Basic Tax Exempt
1. P120,000 - -
2. - - P80,000
3. 50,000 - -
4. - - 6,000/ yr. (RR 8-2018)
5. - - 360,000
6. 250,000 - -
7. - - 45,000
8. - - 15,000
9. 60,000 - -
10. - - 1,500
11. - - 1,500

P3.2
a) Yes
b) GUMV = P325,000/65%=P500,000
c) No. FBT is a final tax, hence, nonreturnable
d) FBT = P500,000 x 35% = P175,000
e) Within 10th day of the month following the end of the calendar quarter in which the
fringe benefits
were granted to the recipient.
P3.3
Compensation income
P900,000
Monthly transportation allowance**
36,000
De Minimis Other Benefits
Benefits
13th month pay - P75,000
Productivity incentive pay (de minimis under RR 1-2015) 10,000 -
Christmas bonus (P5,000 de minimis under RR 1-2015) 5,000 20,000
Uniform allowance (16,000-6,000) 6,000 10,000
Medical allowance (entire amount is de minimis) 10,000 -
Rice subsidy [36,000-(2,000 x 12)] 24,000 12,000
Total (known as 13th Month Pay & Other Benefits) 117,000
Tax Exempt 13th Month Pay & Other Benefits; TRAIN Law (90,000)
27,000
Taxable income
P963,000

**Fixed Allowances received regularly (transportation allowance) shall be treated as part of basic
compensation income
Productivity incentive pay not exceeding P10,000 shall be exempt de minimis
Christmas Gift/Bonus = 1st P5,000 shall be exempt de minimis
P3.4
Compensation income
P900,000
Monthly transportation allowance**
36,000
De Minimis Other Benefits
Benefits
13th month pay - P75,000
Productivity incentive pay (de minimis under RR 1-2015) 20,000
Christmas bonus (P5,000 de minimis under RR 1-2015) 5,000 20,000
Uniform allowance (16,000-6,000) 6,000 10,000
Medical allowance (entire amount is de minimis) 10,000 -
Rice subsidy [36,000-(2,000 x 12)] 24,000 12,000
Total (known as 13th Month Pay & Other Benefits) 137,000
Tax Exempt 13th Month Pay & Other Benefits; TRAIN Law (90,000)
47,000
Taxable income
P983,000

**Fixed Allowances received regularly (transportation allowance) shall be treated as part of basic
compensation income
• BIR RULING No. 293-2015 provides that Productivity incentive if more than P10,000 shall not be
treated as de minimis benefit. The entire amount shall be included as part of “other benefits”
• Christmas Gift/Bonus = 1st P5,000 shall be exempt de minimis
P3.5
Compensation income
P540,000
De Minimis Other Benefits
Benefits
13th month pay and mid-year bonus - P67,500
Christmas gift or bonus P5,000 5,000
Uniform allowance (7,500-6,000) 6,000 1,500
Actual Medical allowance (P15,000-10,000) 10,000 5,000
Medical allowance to dependents (limit is P3k per year) 2,000 -
Rice subsidy [entire amount is de minimis]; max. of P24k per year 18,000 -
Monetized vacation leave [24,000-(2,000x 10)] 20,000 4,000
Total 13th Month Pay & Other Benefits 83,000
Tax Exempt 13th Month Pay & Other Benefits; TRAIN Law 90,000
-
Taxable income
P540,000
P3.6
1.
a) P165,000 x 50% = P82,500
b) P82,500/65% x 35% = P44,423
2.
a. P4.5M x 5% /4 x 50% = P28,125
b. P28,125/65% x 35% = P15,144
3.
a. P4.5M
b. P4.5M/65% x 35% = P2,423,077
4.
a. P1,200,000
b. P1,200,000/65% x 35% = P646,154
5.
a. P800,000
b. P800,000/65% x 35% = P430,769
6.
a. P1,200,000/5 = P240,000
b. P240,000/65% x 35% = P129,230
TRUE OR FALSE
1. FALSE 6. FALSE 11. FALSE
2. FALSE 7. TRUE 12. TRUE
3. TRUE 8. TRUE 13. TRUE
4. TRUE 9. TRUE 14. TRUE
5. TRUE 10. TRUE 15. TRUE

MODIFIED IDENTIFICATION
1. B 6. B 11. A 16. A
2. B 7. B 12. A 17. B
3. A 8. B 13. B 18. B
4. B 9. B 14. A 19. B
5. B 10. B 15. B 20. B

MULTIPLE CHOICE
1. C 11. C 21. A 31. B 41. C
2. A 12. A 22. D 32. A 42. D
3. D 13. A 23. C 33. D 43. D
4. D 14. B 24. D 34. A 44. A
5. D 15. B 25. A 35. C 45. A
6. D 16. D 26. D 36. C 46. A
7. B 17. C 27. B 37. D 47. B
8. A 18. B 28. D 38. B 48. D
9. D 19. C 29. B 39. D 49. A
10. C 20. D 30. D 40. D 50. D
51. D
52. C