6 Write your answers in the rows below the question. 7 Points For payment to a person for his/her services, what is the relationship that must be present between the payee and the payer, for the payment to be considered as income from employment, as opposed to income from self-employment or income earned as a contractor? 2 9 10 What must an employer do concerning the tax on an employee's taxable compensation 71 income? Clue: This is the BIR's way of collecting the tax on compensation income through the employer as agent of the government for such purpose. 12 2 13 On the conditions that must be met so that an employee, after filing by the employer of a Certificate of Compensation Payment/ Tax Withheld with the BIR, need no longer file 14 an income tax return (referred to as "substituted filing" by the employer for the employee) - 15 One condition is that the employee has only 1 employer during the taxable year. 16 Write the other condition below. N 17 18 Small benefits given to employees, like rice subsidy and uniform allowance, are not 19 taxable. What are these benefits called in the tax regulations? Clue: It is s phrase that includes a foreign language term that means "small", the answer is benefits Write the missing term or phrase below. 20 1 21 An employee who is also practicing his/her profession (like on part-time basis or on the side) is a mixed income individual taxpayer. What periodic income tax returns AND how 22 many such returns, must such taxpayer have filed before filing his/her annual income tax return (also referred to as the final return or adjustment return for the year)? 23 2 24 Still on the employee who is also practicing his/her profession above, on his income from the practice of his/her profession: He/she has 2 alternative tax rate options to choose from in computing his/her income tax. One of the options is to compute his/her income tax using the graduated income tax rates. Write his/her other option below 25 (Note: It is assumed that he/she is not a General Professional Partnership or GPP Partner; also that his/her income from the practice of profession did not exceed P3 million; else he/she can not avail of this option that is being asked of you to write below.) N 26 Still on the employee who is also practicing his/her profession above, on his income 28 from the practice of his/her profession, and if he/she chose the graduated income tax rates for computing his/her income tax due - write below the 2 alternative ways he could claim deductions from his/her gross income. 29 NN Still on the employee who is also practicing his/her profession above - How/ when does he/she signify her choice of income tax rates to use in computing his/her income tax? If 32 he/she chose to compute his/her income tax under the graduated income tax rates, this is also how/ when he/she signifies his/her chosen method of claiming deductions from his/her gross income. (This has been studied in past chapters, in the chapters on quarterly return filing of corporations and self-employed individuals.) 33 2 25 Still on the employee who is also practicing his/her profession above: Write below the amount of income exemption he/she is entitled ( or how much is the 36 amount of income of a citizen taxpayer that is exempted from income tax, assuming that the individual is not a minimum wage earner?) 37 2 38 39 Still on the employee who is also practicing his/her profession above: From what income is the said income amount that is exempted from income tax deducted? Is it on the income from employment or from the income from the practice of profession? Note that the said individual taxpayer can only deduct/avail the said income amount exemption once. 41 2 42 43 True or False (Write "True" or "False", not "T' or "F" which may be confusing 44 when handwritten); write True or False in the row immediately below each statement. 45 A minimum wage earner (MWE) is exempt from income tax on his/her minimum wage AG However, his/her holiday pay, night shift differential and hazard pay are already taxable. 47 1 48 If your answer is False, write belowwhy you answered False 49 1 50 51 The earnings of an employee who earns purely compensation income, and who is paid more than the minimum wage, is subject to the 8% gross income tax rate. 52 1 53 If your answer is False, write below why you answered False. 54 1 55 8 25 End of test 57