Bam031 Sas 14 PDF

BAM 031: Income Taxation
Student Activity Sheet: Module #14
Name: PLEÑOS, BILL JOSHUA L._____________________________________________ Class number: _______

Section: A-CMA-BSA-06 Schedule: ________________________________________ Date: ________________
Lesson title: Regular Income Taxation Lesson Text book:

Objectives: Income Taxation by Rex
At the end of this module, I should be able to: Banggawan
1. Differentiating the basic concept of individual and SAS References:
corporate income taxes www.bir.gov.ph/
2. List exclusions and inclusions in Gross Income
Materials:
Productivity Tip: Pat yourself on the back after a good day’s study. Celebrate success no matter how small it seems.
A. LESSON PREVIEW/REVIEW
1) Review (5 – 10 min)
Problem Solving: Write your answers on the space provided.
Problem #1: Taxpayer sold land for P560,000 which was bought for P450,000. For capital gains tax purposes, the
following values was provided:
Market Value P 575,000.00
BIR Zonal Value 600,000.00
Assessed Value 350,000.00
Answer: P600,000.00 x 6% = P36,000.00

Problem #2: Taxpayer sold share of stock of a corporation directly to a buyer for P50,000. Cost of the shares is
P40,000.
Answer: (P50,000.00 – 40,000.00) x 15% = P1,500.00
2) What I know Chart (3 mins)

Try answering the questions below by writing your ideas under the first column What I Know. It’s okay if you write
key words or phrases that you think are related to the questions.
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BAM 031: Income Taxa
Student Activity Sheet: Module

What I Know Questions: What I Learned

TAXES FROM PERSONAL 1 What is are individual income taxes? The individual income tax) is a
INCOME THAT ARE DEDUCTED tax levied on the wages,
TO SALARIES AND WAGES. salaries, dividends, interest,
and other income a person
earns throughout the year.
Corporate taxes are collected 2 What do you initially know about A corporate tax is a tax on the
by the government as a corporate income tax? profits of a corporation. The taxes
source of income. are paid on a company's taxable
income, which includes revenue
minus cost of goods sold (COGS),
general and administrative (G&A)
expenses, selling and marketing,
research and development,
depreciation, and other operating
costs.
B. MAIN LESSON
LO 1: Differentiating the basic concept of individual and corporate income taxes
Income Tax is a tax on a person's income, emoluments, profits arising from property, practice of profession,
conduct of trade or business or on the pertinent items of gross income specified in the Tax Code of 1997 (Tax
Code), as amended, less the deductions if any, authorized for such types of income, by the Tax Code, as amended,
or other special laws.
Determine taxable income: Individual Income Tax & Corporate Income Tax
Individuals Resident citizens receiving income from sources within or outside the Philippines
Non-resident citizens receiving income from sources within the Philippines

Aliens, whether resident or not, receiving income from sources within the Philippines
Non- Corporations including partnerships, no matter how created or organized.

Individuals Domestic corporations receiving income from sources within and outside the Philippines
Foreign corporations receiving income from sources within the Philippines

Estates and trusts engaged in trade or business
Income Tax Return

• BIR Form 1700 - Annual Income Tax for Individuals Earning Purely Compensation Income (Including Non-
Business/Non-Profession Related Income)
• BIR Form 1701 - Annual Income Tax Return Individuals, Estates and Trusts
• BIR Form 1702 - Annual Income Tax Return (For Corporations and Partnerships)
• BIR Form 1704 - Improperly Accumulated Earnings Tax Return (For Corporations)
ACTIVITY 1: ‘Turn and talk’ using guide questions using your own words. (3 – 5 minutes)
1. What do you understand about regular income tax and its characteristics
2. How do you distinguish Individual Income Tax with Corporate Income Tax
3. What are the key things to know in income Tax Returns
LO 2: List exclusions and inclusions in Gross Income
The following are exclusions in Gross Income

• Life insurance
• Amount received by insured as return of premium
• Gifts, bequests and devises
• Compensation for injuries or sickness
• Income exempt under treaty
• Retirement benefits, pensions, gratuities, etc.
• Miscellaneous items
The following are inclusions in Gross Income

• Compensation for services, in whatever form paid, including but not limited to fees, salaries, wages,
commissions and similar items
• Gross income derived from the conduct of trade or business or the exercise of profession Gains
derived from dealings in property
• Interest
• Rents
• Royalties
• Dividends
• Annuities
• Prizes and winnings
• Pensions
• Partner's distributive share from the net income of the general professional partnerships
ACTIVITY 2: ‘Check for understanding’, Answer Chapter Test
C. LESSON WRAP-UP
Congratulations for fhinishing another module! Shade the number of the module that you finished to track your
accomplishment.
Did you have challenges learning the concepts in this module? If none, which parts of the module helped you learn the
concepts?
MAIN LESSON AND BOOK LECTURE HELPED ME UNDERSTAND THE TOPIC.
Some question/s I want to ask my teacher about this module is/are:

NONE SO FAR
FAQs
1. What is Taxable Income?

Taxable income means the pertinent items of gross income specified in the Tax Code as amended, less
the deductions, if any, authorized for such types of income, by the Tax Code or other special laws.

2. Who are not required to file Income Tax returns?

a. An individual earning purely compensation income whose taxable income does not exceed
P250,000.00
b. An individual whose income tax has been withheld correctly by his employer, provided that such
individual has only one employer for the taxable year
c. An individual whose sole income has been subjected to final withholding tax or who is exempt from
income tax pursuant to the Tax Code and other special laws.
d. An individual who is a minimum wage earner
e. Those who are qualified under “substituted filing”.
Answers to review test:

Problem Solving:
Problem #1: Taxpayer sold land for P560,000 which was bought for P450,000. For capital gains tax purposes, the
following values was provided:
Market Value P 575,000.00
BIR Zonal Value 600,000.00
Assessed Value 350,000.00
P600,000 x 6% = P36,000 CGT
Problem #2: Taxpayer sold share of stock of a corporation directly to a buyer for P50,000. Cost of the shares is
P40,000.
P50,000 – P40,000 = P10,000 Capital Gain P10,000 x 15% = P1,500 CGT

ACTIVITY 1
1. Regular income tax applies to all items except those that are subject to final tax, capital gains and special tax
regimes. Tax is imposed on profits after expenses are deducted. Regular income tax applies annually.
2. In regular income tax is based on their compensation income or professional income. While corporate income
taxes apply to any corporations, with exceptions.
3. Individual tax payers engaged in business or practice of profession shall file their quarterly income tax returns
using BIR Form 1701Q. Corporations shall file their quarterly income tax returns using 1702Q.
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BAM 031: Income Taxation

Student Activity Sheet: Module #14

Name: PLEÑOS, BILL JOSHUA L._____________________________________________ Class number: _______

Lesson title: Regular Income Taxation Lesson Text book:

Answer: P600,000.00 x 6% = P36,000.00

Answer: (P50,000.00 – 40,000.00) x 15% = P1,500.00

2) What I know Chart (3 mins)

Name: PLEÑOS, BILL JOSHUA L._____________________________________________ Class number: _______

What I Know Questions: What I Learned

Non-resident citizens receiving income from sources within the Philippines

This document is the property of PHINMA EDUCATION

Name: PLEÑOS, BILL JOSHUA L._____________________________________________ Class number: _______

Non- Corporations including partnerships, no matter how created or organized.

Foreign corporations receiving income from sources within the Philippines

Income Tax Return

LO 2: List exclusions and inclusions in Gross Income

The following are exclusions in Gross Income

The following are inclusions in Gross Income

This document is the property of PHINMA EDUCATION

Name: PLEÑOS, BILL JOSHUA L._____________________________________________ Class number: _______

ACTIVITY 2: ‘Check for understanding’, Answer Chapter Test

Some question/s I want to ask my teacher about this module is/are:

1. What is Taxable Income?

Name: PLEÑOS, BILL JOSHUA L._____________________________________________ Class number: _______

2. Who are not required to file Income Tax returns?

Answers to review test:

P600,000 x 6% = P36,000 CGT

P50,000 – P40,000 = P10,000 Capital Gain P10,000 x 15% = P1,500 CGT

This document is the property of PHINMA EDUCATION

Name: PLEÑOS, BILL JOSHUA L._____________________________________________ Class number: _______

This document is the property of PHINMA EDUCATION

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