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Income Taxation Law Chapter 3: Persons Subject to Income Tax

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Questions and Answers

What is the primary characteristic of a joint account?

Merchants contribute capital and share favorable and unfavorable results (correct)
It is a type of tax rate applicable to corporations
It is a tax obligation of online entities
It is a type of online business transaction

What is the tax rate applicable to special aliens?

20% or 25% on taxable income
8% on optional gross income
35% and 25% on fringe benefits
15% on gross income (correct)

What is the tax rate on capital gains from shares not traded through the stock exchange?

35% on fringe benefits
6% on real property
15% on shares not traded through the stock exchange (correct)
20% or 25% on taxable income

What is the minimum corporate income tax rate effective from July 1, 2020 to June 30, 2023?

1% on taxable income (D) Signup and view all the answers

What type of online business transaction involves the sale of goods or services through the internet?

Online shopping or online retailing (C) Signup and view all the answers

How do merchants benefit from a joint account, and what are the implications of this arrangement?

Merchants benefit from a joint account by sharing contributions and participating in both favorable and unfavorable results in a predetermined proportion. This arrangement allows them to distribute risks and rewards, promoting cooperation and shared responsibility. Signup and view all the answers

Explain the difference between the gross income tax rates applicable to NRANETB and special aliens.

NRANETB is subject to a gross income tax rate of 25%, while special aliens are subject to a gross income tax rate of 15%. Signup and view all the answers

Distinguish between the tax obligations of online businesses and those of traditional offline businesses.

Same tax rules apply to both online and offline businesses; the mode of conducting business (online or offline) does not affect the tax obligations. Signup and view all the answers

What are the key tax implications for corporations, and how do these differ from those applicable to individuals?

Corporations are subject to a flat rate of 20% or 25% on taxable income, while individuals are subject to a graduated income tax rate ranging from 0% to 35%. Corporations are also subject to other taxes, such as the minimum corporate income tax rate and the gross Philippine billings tax. Signup and view all the answers

How do capital gains taxes on real property and shares differ, and what are the implications for investors?

Capital gains taxes on real property are 6%, while those on shares not traded through the stock exchange are 15%. This disparity can impact investors' decisions on asset allocation and portfolio diversification. Signup and view all the answers

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