Understanding Fringe Benefits in Employment
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Questions and Answers

Which of the following is considered a taxable fringe benefit?

  • Membership fees paid by the employee for a social club
  • Contributions made by the employer to the employee's retirement plan
  • Christmas bonus given to all employees
  • A household maid provided by the employer (correct)

    • What is the tax rate for taxable fringe benefits received by a managerial or supervisorial employee who is a resident citizen?

  • Subject to the 90,000 limit
  • 20% - 35% (graduated rates)
  • 25% final tax
  • 35% final tax (correct)

    • Which of the following is considered a non-taxable fringe benefit?

  • Fringe benefits authorized and exempted from tax under special laws (correct)
  • A vehicle of any kind provided by the employer
  • Educational assistance provided by the employer for the employee's dependents
  • Interest on a loan provided by the employer at a lower rate than the market rate

    • For rank-and-file employees, what is the tax treatment of fringe benefits that exceed the $90,000 limit?

    <p>The excess is subject to the normal graduated tax rates ranging from 20% - 35%</p> Signup and view all the answers

    What is the monetary value of a cash fringe benefit?

    <p>The face amount or value received</p> Signup and view all the answers

    Which of the following is considered a taxable fringe benefit for a non-resident alien not engaged in trade or business?

    <p>Holiday and vacation expenses paid by the employer</p> Signup and view all the answers

    What is the primary purpose of distinguishing between a rank-and-file employee and a managerial or supervisorial employee?

    <p>To determine their tax treatment for fringe benefits</p> Signup and view all the answers

    According to the given information, which of the following statements about managerial employees is true?

    <p>They have the authority to lay down management policies</p> Signup and view all the answers

    Which of the following characteristics best describes a rank-and-file employee?

    <p>Their work is routinary and clerical in nature</p> Signup and view all the answers

    Based on the information provided, which of the following statements is true about supervisory employees?

    <p>They can effectively recommend managerial actions using independent judgment</p> Signup and view all the answers

    What is the primary characteristic that distinguishes a fringe benefit from regular salary?

    <p>Fringe benefits are provided in addition to basic salary</p> Signup and view all the answers

    According to the information provided, which of the following statements is true about managerial and supervisorial employees?

    <p>They are taxed differently than rank-and-file employees for fringe benefits</p> Signup and view all the answers

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