Ethan, a resident alien, owns a share in PPP, Inc., a Philippine publicly-listed company. In 2020, he sold the shares directly to his friend, Lily, for P2,000,000 evidenced by the deed of absolute sale. Ethan acquired the shares in 2018 for P500,000. The sale was recorded in the stock transfer books of the corporation and the certificate of stock ownership was duly issued to Lily.

How much was the income tax arising from the sale?

Manuel signified his intention to be taxed at an 8% income tax rate on gross sales in his Q1 Income Tax Return. He has no other source of income. His total sales for the first three quarters amounted to P2,000,000. However, his sales amounted to P1,500,000. His total cost of service and operating expenses amounted to P1,000,000 and P640,000, respectively. 

Compute the remaining income tax payable for his annual income tax return?

Answer rating: 100% (QA)

For the sale of shares by Ethan to Lily the capital gain is computed a... View the full answer