SELF EMPLOYED AND/OR PROFESSIONALS (SEP)

Solution:

Case A – In 2021, Andrew Tan, purely self-employed, has gross sales of ₱ 152,000, cost of sales of P17,500, and
other operating expenses of P2,450 for the first quarter. Consistently every quarter, his gross sales, cost of sales, and
operating expenses increase by 25%, 12%, and 10% respectively.
How much is his income tax due for the year?

Case B – Compute for the income tax due of Lance Gokongwei for 2021:

Gross Sales ₱ 5,260,600

Cost of Sales 1,550,900

Operating expenses 86,100

Case C – Lucio Tan has decided to opt for the 8% tax rate on gross sales in his 2020 income tax return. How
much is Lucio’s annual income tax payable?

Sales ₱ 2,980,000

Cost of Sales 35% of Sales

Operating Expenses 10% of the Cost of Sales
Case D – David Consunji is a mixed income earner whose gross sales/receipts and other operating income
does not exceed the VAT threshold of ₱ 3,000,000

Compensation income ₱ 330,000

Gross Sales ₱ 2,250,000

Cost of Sales 45% of Sales
Operating Expenses 13% of the Cost of Sales

What is the amount of David’s income tax due?

Assume David expressed that he would want to avail the 8% tax under the TRAIN Law, what’s his tax due?