Professional Documents
Culture Documents
Corporate Tax Questionnaires
Corporate Tax Questionnaires
CORPORATIONS
1. One of the following does not fall under the definition of a “corporation” for income tax purposes:
a. General partnership
b. One-person corporation
c. Insurance company
d. Sole proprietorship
2. For income taxation purposes, the term “corporation” excludes one of the following:
a. Ordinary partnership
b. An incorporated business organization
c. General professional partnership
d. One-person corporation
3. A corporation organized and created under the laws of a foreign country and is authorized to do
business/ trade in the Philippines is:
a. Domestic corporation
b. Resident foreign corporation
c. Government owned and controlled corporation
d. Non-profit hospital
5. A domestic corporation or resident foreign corporation may employ, as a basis for filing its annual
corporate income tax return the:
a. Calendar year only c. Either calendar or fiscal year
b. Fiscal year only d. Neither calendar or fiscal year
8. DEF, a corporation registered in Germany, operates a 1,000 ton steel milling plant in Quezon
province. Which among the following shall be taxable under the Tax Code?
9. Aplets Corporation is registered under the laws of the Virgin Islands. It has extensive operations in
Southeast Asia. In the Philippines, its products are imported and sold at a mark-up by its exclusive
distributor, Kim’s Trading, Inc. The BIR compiled a record of all the imports of Kim from Aplets and
imposed a tax on Aplets’s net income derived from its exports to Kim. Is the BIR correct?
a. Yes. Aplets is a non-resident foreign corporation engaged in trade or business in the Philippines.
b. No. The tax should have been computed on the basis of gross revenues and not net income.
c. No. Aplets is a non-resident foreign corporation not engaged in trade or business in the
Philippines.
d. Yes, Aplets is doing business in the Philippines through its exclusive distributor Kim’s Trading
Inc.
10. ABC Inc., a corporation registered and holding office in Australia, not operating in the Philippines,
may be subject to Philippine income taxation on
a. Gains it derived from sale in Australia of an ore crusher it bought from the Philippines with the
proceeds converted to pesos.
b. Gains it derived from sale in Australia of shares of stock of Philex Mining Corporation, a
Philippine corporation.
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c. Dividends earned from investment in a foreign corporation that derived 40% of its gross income
from Philippine sources.
d. Interest derived from its dollar deposits in a Philippine bank under the Expanded Foreign Currency
Deposit System.
12. The Philippine Health Insurance Corporation (Philhealth), and the Home Development Mutual Fund
(Pagibig) are government-owned corporations which are
a. Exempt from the corporate income tax.
b. Subject to the preferential corporate income tax for special corporations.
c. Subject to the basic corporate income tax
d. Subject to final tax
13. Public educational institutions, like the University of the Philippines, is deemed by law:
a. Subject to the preferential corporate income tax for special corporations.
b. Subject to the basic corporate income tax.
c. Subject to both the preferential income tax and the basic corporate income tax.
d. Exempt from the corporate income tax.
14. Which is not correct? The following are exempt from the corporate income tax:
a. Local water districts
b. Bureau of Internal Revenue
c. Government owned or controlled corporations
d. Social Security System
15. Which of the following may be subject to the corporate income tax?
a. A non-stock and non-profit educational institution
b. A public educational institution
c. A private educational institution
d. Government Service Insurance System
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16. The improperly accumulated earnings tax (IAET) shall apply to:
a. Publicly held corporations for all taxable years prior to 2021
b. Banks and other non-bank financial intermediaries
c. Insurance companies for taxable years ending after July 20, 2020
d. Closely held domestic corporations for taxable years ending prior to April 11, 2021.
19. The MCIT shall not apply to the following resident foreign corporations, except
a. RFC engaged in business as international carrier subject to 2 1/2 % of their Gross Philippine
Billings
b. RFC engaged in business as ROHQ before January 1, 2022
c. Offshore banking units beginning April 11, 2021
d. None of the above
20. Beginning July 1, 2020, the RCIT rate for domestic corporations shall be 25%. However, a lower
RCIT rate of 20% shall be imposed if the following conditions is/are present:
a. The domestic corporation’s net taxable income is not more than ₱5.0 Million
b. The domestic corporation’s net assets (excluding the land on which its office, plant, or equipment
are situated) are not more than ₱100 Million.
c. All of the above.
d. None of the above.
21. The MCIT is 2% of gross income. However, the MCIT rate to be imposed shall be 1%
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22. CPG Corporation had the following data for calendar year 2021, its first year of operations:
The corporation’s audited financial statements as of December 31, 2021 includes the following
accounts:
23. Compute the income tax due in number 22 if the taxpayer is a foreign corporation with a branch in
the Philippines (RFC).
a. ₱1,500,000
b. ₱ 975,000
c. ₱1,175,000
d. None of the above
24. Compute the income tax due in number 22 if the taxpayer is a foreign corporation with no branch or
office in the Philippines (NRFC).
a. ₱1,500,000
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b. ₱ 975,000
c. ₱1,175,000
d. None of the above
25. MVP Corporation, domestic corporation, had the following financial data for taxable year ending
April 30, 2021:
Compute the corporation’s income tax due for taxable year ending April 30, 2021, if it is taxable at the
new RCIT rate of 20% effective July 1, 2020.
(a) ₱866,667
(b) ₱1,000,000
(c) ₱75,833
(d) None of the above.
26. The records of Acme Corporation, domestic, organized in 2014, engaged in retail, show the following
in calendar years 2019, 2020, 2021:
The corporation had excess tax credits at the end of 2018 in the amount of ₱15,000. The corporation
chooses to credit in future years any excess tax credits it may have in a taxable year.
a. ₱35,400, ₱2,400
b. ₱35,400, ₱17,400
c. ₱8,940; ₱0
d. None of the above
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27. In number 26, what would be the tax payable of Acme Corporation for taxable years 2020 and 2021 if
the taxpayer qualifies for the 20% tax rate effective July 1, 2020?
a. ₱23,000; ₱55,978
b. ₱6,440; ₱134,908
c. ₱30,500; ₱131,908
d. None of the above.
28. The records of CAMEL Corporation, domestic, show the following for calendar year 2021.
The income tax payable for the first 3 quarters and in the annual return are: a.
₱84,000; ₱329,000; ₱592,500; ₱802,500
b. ₱84,000; ₱195,000; ₱435,500; ₱802,500
c. ₱54,000; ₱245,000; ₱193,500; ₱175,000
d. ₱10,000; ₱94,500; ₱259,250; ₱140,000
e. None of the above
29. If the gross income from unrelated activity exceeds 50% of the total gross income derived by any
proprietary educational institution, the tax rate shall be the RCIT rate (25%/20%) based on the entire
taxable income. This is known as the a. Constructive receipt
b. Tax benefit rule
c. End trust doctrine
d. Predominance test
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30. Holy Hospital, Inc. (domestic corporation), a private non-profit hospital, has the following financial
information for CY 2021:
Hospital-related activities:
Gross receipts ₱10,000,000
Cost of services 4,000,000
Operating expenses 1,250,000
a. ₱2,687,500
b. ₱2,500,000
c. ₱2,680,000
d. None of the above.
31. CPA University, a proprietary educational institution organized in 2006, had the following data for
2021:
b. P 10,500
c. (P 5,800)
d. None of the above.
32. CPA Airlines, a resident foreign international carrier has the following records of income for the
period. ( The income represents gross billings.)
a. Continuous flight from Manila to Tokyo = 1,000 tickets at P2,000 per ticket
b. Flight from Manila to Taipei; transfer flight (on CPAR Airlines) from Taipei to Tokyo = 2,000
tickets at P2,000 per ticket
c. Continuous flight from Manila to Taipei = 3,000 tickets at P1,000 per ticket
The income tax due is
a. P 225,000
b. P 125,000
c. P 100,000
d. P 175,000
33 -37. The Alliance Corporation provided the following data for the calendar year ending December 31,
2021 ($ 1 = P50)
Philippines U.S.A.
Gross Income ₱4,000,000 $40,000
Deductions ₱2,500,000 $15,000
Income Tax Paid $ 3,000
36. If it is a non-resident lessor of aircrafts, machineries and equipment, its income tax is
a. P100,000 c. P300,000
b. P180,000 d. P128,000
37. If it is a resident foreign corporation but its expenses within and outside the Philippines is P3m,
unallocated (disregard original data on expense). Furthermore, its total assets amount to
₱90,000,000. What is its total income tax liability if it remits 60% of its net profit to its head office
abroad?
a. P635,000
b. P726,000
c. P480,000
d. None of the above.
38. DBH Corporation, an RFC, is also a registered ROHQ since 2009. For taxable years 2020 to 2023,
its operations show the following finacial results:
39. “A” Corporation with total assets of ₱40,000,000, excluding the land on which its business is
situated, has the following data for the year 2021:
Other Income:
Dividend from San Miguel Corp. 70,000
Dividend from Ford Motors, USA 120,000
Gain, sale of San Miguel shares directly to buyer 150,000
Royalties, Philippines 50,000
Royalties, USA 100,000
Interest income (other than from bank deposit) 60,000
Rent, land in USA 250,000
Other rental income (Phils.) 100,000
Prize, contest in Manila 200,000
Interest income ($ deposit in BDO) 50,000
40. Based on the above problem, its total tax liability if it is a resident foreign corporation is
a. ₱318,000 c. ₱328,750
b. ₱305,000 d. None of the above.
42. Any income from transactions with depository banks under the expanded foreign currency deposit
system shall be exempt from income tax if derived by a a. Domestic corporation
b. Resident foreign corporation
c. Non-resident foreign corporation
d. Resident alien
43. The records of a closely-held domestic corporation show the following data for fiscal year ending
June 30, 2021:
In the previous fiscal year, the corporation suffered an operating loss of P130,000. This amount was
carried forward and claimed as deduction from gross income in fiscal year ending June 30, 2021. Also
in FY ending June 30, 2021, total CWT withheld from its income amounted to P40,000. The income
tax still due or payable for FY ending June 30, 2021 assuming it qualifies for a 20% income tax rate is
a. P126,000
b. P249,000
c. P273,937
d. None of the above
44. In number 43, the improperly accumulated earnings tax to be imposed for FY ending June 30, 2021 is
a. P36,075
b. P34,765
c. P35,640
d. None
45. Good Vibes Corporation is a domestic corporation and has, since 2015, owned 50% of the
outstanding shares of FirstWorld Corporation, a non-resident foreign corporation. On May 10, 2021,
Good Vibes received a dividend from FirstWorld in the amount of ₱5.0 Million.
On November 8, 2022, Good Vibes paid ₱2.0 Million (out of the ₱5.0 Million) as dividends to its
shareholders. On February 14, 2023, Good Vibes utilized ₱500,000 (of the remaining ₱3.0 Million) for
capital expenditures. On October 8, 2024, it invested the remaining ₱2.5 Million in a domestic
subsidiary.
a. Good Vibes will be subject to income tax on ₱2.0 Million for the taxable year 2021, plus
surcharge, interest, and penalties.
b. Good Vibes will be subject to income tax on ₱2.5 Million for the taxable year 2021, plus
surcharge, interest, and penalties.
c. Good Vibes will be subject to income tax on ₱3.0 Million for the taxable year 2021, plus
surcharge, interest, and penalties.
d. None of the above.
END