Taxation Questions

SET A
1. Real property declared for the first time shall be assessed for taxes for the period during
which it would have been liable but in no case of more than__________ prior to the date of
initial assessment:
ANSWER: 10 YEARS
2. The sworn declaration of real property shall be filed with ____________ once every
_____________.
ANSWER: THE ASSESSOR , 3 YEARS
3. Sworn declaration of property filed during the period ___________________.

ANSWER: From January 1 to June 30, commencing with the year 1992:
4. Acquisition of real property or improvements on real property shall be filed a sworn

statement declaring the true value of subject property ________.
ANSWER: Within sixty (60) days after the acquisition of such property or upon completion or
occupancy of the improvement, whichever comes earlier:
5. Every person... who shall claim tax exemption for such property under this Title shall file with
the provincial, city or municipal assessor within _________ from the date of the declaration of
real property.
30 days:
6. Failure to pay taxes at the end of the quarter following the date the notice of assessment was
received shall be subject to an interest rate of ____________.
2%:
7. Any owner or person having legal interest in the property who is not satisfied with the action
of the provincial, city or municipal assessor in the assessment of his property may, within
__________ from the date of receipt of the written notice of assessment, appeal to the Board
of Assessment Appeals of the provincial or city
60 days:
8. Composition of the Local Board of Assessment Appeals

Chairman - Registrar of Deeds
Member - Provincial/City Prosecutor
Member - Provincial/City Engineer
9. Rate of basic real property tax

Of the assessed value:
1% - province
Not exceeding 2% - Metro Manila:
10. Idle Lands Coverage

Agricultural Land
- if 1/2 of 1 hectare is uncultivated
- if 50 trees of perennial crops to a hectare are planted (exempt)
Lands other than agricultural
- more than 1/2 of 1000 sq.m. is unutilized or unimproved:
11. Exemptions from additional idle land levy

Inability to improve, utilize or cultivate lands by reason of force majeure, civil disturbance,
natural calamity:
12. Special levy shall not exceed _________.

60% of the actual cost of projects and improvements including cost
of acquiring lands for public works projects.
13. Payment of special levy

Annual payments of not less than 5 years and not more than 10 years:
14. If the basic real property tax and the additional tax accruing to the Special Education Fund
(SEF) are paid in advance in accordance with the prescribed schedule of payment, a discount
not exceeding ________ of the annual tax due may be granted.
20%:
15. The protest in writing must be filed within _________ days from payment of the tax to the
provincial, city treasurer or municipal treasurer, in the case of a municipality within
Metropolitan Manila Area, who shall decide the protest within ________ from receipt.
30 days, 60 days
16.: Tax credit or refund may be claimed within _____________ from the date the taxpayer is
entitled to such reduction or adjustment.
2 years, action from provincial/city treasurer required within 60 days from receipt
17. Unpaid basic real property tax or any other tax levied shall be subject to _____________
and shall in no case exceed ______________.
2% per month, not more than 36 months:
18. The proceeds from the additional one percent (1%) tax on real property accruing to the
Special Education Fund (SEF) shall be automatically released to the ______________
Local school boards:
19. The proceeds of the additional real property tax on idle lands shall accrue to the respective
_____________.
General fund of the province or city where the land is located:
20. The proceeds of the special levy on lands benefited by public works, projects and other
improvements shall accrue to the _______________.
general fund of the local government unit which financed such public works, projects or other
improvements:
21. The ______________ may, when public interest so requires, condone or reduce the real
property tax and interest for any year in any province or city or a municipality within the
Metropolitan Manila Area.
President of the Philippines:
1. National Internal Revenue Code of 1997

As Amended By Republic Act No. 109631
2. TRAIN
Tax Reform or Acceleration and Inclusion:
3. Tax Reform for Acceleration and Inclusion (TRAIN), is prepared by the ____ to provide a
general understanding of taxation, raise the level of tax consciousness among our people, and
promote and improve tax compliance that will consequently increase revenue and strengthen
the fiscal position of the government.
National Tax Research Center:
4. The current administration is pushing for the attainment of more inclusive and sustainable
growth through the ____ which aims to make the tax system simpler, fairer and more efficient,
improve tax administration, and generate additional revenues that shall be used to fund the
administration's priority infrastructure and social programs that will ultimately benefit the poor.
Comprehensive Tax Reform Program (CTRP):
5. The TRAIN is the first package of the CTRP, which the President signed into law on ____
December 19, 2017:
6. The law provides, among others, the lowering of the personal income tax rates; simplification
of the estate and donor's tax; repeal of several non-essential exemptions to the value-added
tax (VAT); adjustment in the excise tax rates for fuel, coal and automobiles; and imposition of a
tax on sugar sweetened beverages and cosmetic surgery and other aesthetic procedures.
TRAIN law:
7. Section 1
. Title of the Code. - This Code shall be known as the National Internal Revenue Code (NIRC)
of 1997:
8. Section 2
Powers and Duties of the Bureau of Internal Revenue:
9. The Bureau of Internal Revenue shall be under the supervision and control of the___
Department of Finance:
10. its powers and duties shall comprehend the assessment and collection of all national
internal revenue taxes, fees, and charges, and the enforcement of all forfeitures, penalties, and
fines connected therewith, including the execution of judgments in all cases decided in its favor
by the Court of Tax Appeals and the ordinary courts. The Bureau shall give effect to and
administer the supervisory and police powers conferred to it by this Code or other laws.
Bureau of Internal Revenue:
11. . Section 3
Chief Officials of the Bureau of Internal Revenue:
12. The Bureau of Internal Revenue shall have a chief to be known as _______, hereinafter
referred to as the Commissioner and _______ chiefs to be known as Deputy Commissioners.
Commissioner of Internal Revenue, four (4) assistant
13. The Bureau of Internal Revenue shall have a chief to be known as Commissioner of Internal
Revenue, hereinafter referred to as the Commissioner and four (4) assistant chiefs to be known
as ____.
Deputy Commissioners:
14. Section 4
Power of the Commissioner to Interpret Tax Laws and to Decide Tax Cases:
15. The power to interpret the provisions of this Code and other tax laws shall be under the
exclusive and original jurisdiction of the Commissioner, subject to review by the___
Secretary of Finance:
16. The power to decide disputed assessments, refunds of internal revenue taxes, fees or other
charges, penalties imposed in relation thereto, or other matters arising under this Code or
other laws or portions thereof administered by the Bureau of Internal Revenue is vested in the
Commissioner, subject to the exclusive appellate jurisdiction of the ____.
Court of Tax Appeals:
17. Section 5
Power of the Commissioner to Obtain Information, and to Summon, Examine, and Take
Testimony of Persons:
18. (A) To examine any book, paper, record, or other data which may be relevant or material to
such inquiry;
(B) To obtain on a regular basis from any person other than the person whose internal revenue
tax liability is subject to audit or investigation
(C)To summon the person liable for tax or required to file a return to appear before the
Commissioner or his duly authorized representative at a time and place specified in the
summons and to produce such books, papers, records, or other data, and to give testimony;
(D) To take such testimony of the person concerned, under oath, as may be relevant or material
to such inquiry
(E) To cause revenue officers and employees to make a canvass from time to time of any
revenue district or region and inquire after
Section 5. Power of the Commissioner to Obtain Information, and to Summon, Examine, and
Take Testimony of Persons. - In ascertaining the correctness of any return, or in making a
return when none has been made, or in determining the liability of any person for any
internal revenue tax, or in collecting any such liability, or in evaluating tax compliance, the
Commissioner is authorized
19. That the Cooperative Development Authority shall submit to the Bureau a tax incentive
report, which shall include information on the income tax, value-added tax, and other tax
incentives availed of by cooperatives registered and enjoying incentives under ____, as
amended
Republic Act No. 6938:
20. Provided, further, That the information submitted by the Cooperative Development
Authority to the Bureau shall be submitted to the Department of Finance and shall be included
in the database created under Republic Act No. 10708, otherwise known as ____
'The Tax Incentives Management and Transparency Act (TIMTA):
21.The provisions of the foregoing paragraphs notwithstanding, nothing in this Section shall be
construed as granting the Commissioner the authority to___.
Inquire into bank deposits other than as provided for in Section 6(F) of this Code
22. Section 6
Power of the Commissioner to Make Assessments and Prescribe Additional Requirements for
Tax Administration and Enforcement:
23. (A) Examination of Return and Determination of Tax Due.

(B) Failure to Submit Required Returns, Statements, Reports and other Documents (C) Authority
to Conduct Inventory-taking, Surveillance and to Prescribe Presumptive Gross Sales and
Receipts
(D) Authority to Terminate Taxable Period
(E) Authority of the Commissioner to Prescribe Real Property Values
(F) Authority of the Commissioner to Inquire into Bank Deposit Accounts and Other Related
Information Held by Financial Institutions
(G) Authority to Accredit and Register Tax Agents
(H) Authority of the Commissioner to Prescribe Additional Procedural or Documentary
Requirements
Section 6. Power of the Commissioner to Make Assessments and Prescribe Additional
Requirements for Tax Administration and Enforcement
24. Any return, statement of declaration filed in any office authorized to receive the same shall
not be withdrawn: Provided, That within ___, the same may be modified, changed, or
amended: Provided, further, That no notice for audit or investigation of such return, statement
or declaration has in the meantime been actually served upon the taxpayer
three (3) years from the date of such filing
25. When a report required by law as a basis for the assessment of any national internal
revenue tax shall not be forthcoming within the time fixed by laws or rules and regulations or
when there is reason to believe that any such report is false, incomplete or erroneous, the
Commissioner shall ___
assess the proper tax on the best evidence obtainable
26. In case a person fails to file a required return or other document at the time prescribed by
law, or willfully or otherwise files a false or fraudulent return or other document, the
Commissioner shall
make or amend the return from his own knowledge and from such information as he can
obtain through testimony or otherwise, which shall be prima facie correct and sufficient for
all legal purposes
27. The Commissioner may, at any time during the taxable year, _____ as a basis for
determining his internal revenue tax liabilities, or may place the business operations of any
person, natural or juridical, under observation or surveillance if there is reason to believe that
such person is not declaring his correct income, sales or receipts for internal revenue tax
purposes.
order inventory-taking of goods of any taxpayer
28. Authority to Terminate Taxable Period. - When it shall come to the knowledge of the
Commissioner that a taxpayer is retiring from business subject to tax, or is intending to leave
the Philippines or to remove his property therefrom or to hide or conceal his property, or is
performing any act tending to obstruct the proceedings for the collection of the tax for the past
or current quarter or year or to render the same totally or partly ineffective unless such
proceedings are begun immediately
the Commissioner shall declare the tax period of such taxpayer terminated at any time and
shall send the taxpayer a notice of such decision, together with a request for the immediate
payment of the tax for the period so declared terminated and the tax for the preceding year
or quarter, or such portion thereof as may be unpaid, and said taxes shall be due and payable
immediately and shall be subject to all the penalties hereafter prescribed, unless paid within
the time fixed in the demand made by the Commissioner
29. For purposes of computing any internal revenue tax, the value of the property shall be,
whichever is the higher of:
(1) the fair market value as determined by the Commissioner; or
(2) the fair market value as shown in the schedule of values of the Provincial and City
Assessors
30. Notwithstanding any contrary provision of Republic Act No. 1405, Republic Act No. 6426,
otherwise known as the ___, and other general or special laws, the Commissioner is hereby
authorized to inquire into the bank deposits and other related information held by financial
institutions of
Foreign Currency Deposit Act of the Philippines
31. The Commissioner shall provide the tax information obtained from banks and financial
institutions pursuant to a convention or agreement upon request of the foreign tax authority
when such requesting foreign tax authority has provided the following information to demon-
strate the foreseeable relevance of the information to the request
(a) The identity of the person under examination or investigation
(b) A statement of the information being sought
(c) The tax purpose for which the information is being sought
(d) Grounds for believing
(e) To the extent known, the name and address of any person believed to be in possession of
the requested information
(f) A statement that the request is in conformity with the law and administrative practices of
the said foreign tax authority
(g) A statement that the requesting foreign tax authority has exhausted all means available in
its own territory to obtain the information, except those that would give rise to
disproportionate difficulties.:
32. The Commissioner shall forward the information as promptly as possible to the requesting
foreign tax authority. To ensure a prompt response, the Commissioner shall confirm receipt of a
request in writing to the requesting tax authority and shall notify the latter of deficiencies in the
request, if any, .
within sixty (60) days from the receipt of the request:
33. If the Commissioner is unable to obtain and provide the information ___, due to obstacles
encountered in furnishing the information or when the bank or financial institution refuses to
furnish the information, he shall immediately inform the requesting tax authority of the same,
explaining the nature of the obstacles encountered or the reasons for refusal.
within ninety (90) days from the receipt of the request:
34. The term '____', as used herein, shall refer to the tax authority or tax administration of the
requesting State under the tax treaty or convention to which the Philippines is a signatory or a
party of.
foreign tax authority:
35. Section 7
Authority of the Commissioner to Delegate Power:
36.the following powers of the Commissioner shall not be delegated

(a) The power to recommend the promulgation of rules and regulations by the Secretary of
Finance
(b) The power to issue rulings of first impression or to reverse, revoke or modify any existing
ruling of the Bureau
(c) The power to compromise or abate
(d) The power to assign or reassign internal revenue officers to establishments where articles
subject to excise tax are produced or kept
37. Section 8
Duty of the Commissioner to Ensure the Provision and Distribution of Forms, Receipts,
Certificates, and Appliances, and the Acknowledgment of Payment of Taxes:
38. Section 9
Internal Revenue Districts:
39. With the approval of the Secretary of Finance, the Commissioner shall divide the Philippines
into such number of revenue districts as may from time to time be required for administrative
purposes. Each of these districts shall be under the supervision of a Revenue District Officer
Section 9. Internal Revenue Districts:
40. With the approval of the Secretary of Finance, the Commissioner shall divide the Philippines
into such number of revenue districts as may from time to time be required for administrative
purposes. Each of these districts shall be under the supervision of a ____
Revenue District Officer:
41. Section 10
Revenue Regional Director:
42. Section 10.Revenue Regional Director. - Under rules and regulations, policies and standards
formulated by the Commissioner, with the approval of the Secretary of Finance, the Revenue
Regional Director shall, within the region and district offices under his jurisdiction, among
others:
(A) Implement laws, policies, plans, programs, rules and regulations of the department or
agencies in the regional area
(B) Administer and enforce internal revenue laws, and rules and regulations, including the
assessment and collection of all internal revenue taxes, charges and fees
(C) Issue Letters of Authority for the examination of taxpayers within the region
(D) Provide economical, efficient and effective service to the people in the area
(E) Coordinate with regional offices or other departments, bureaus and agencies in the area
(F) Coordinate with local government units in the area
(G) Exercise control and supervision over the officers and employees within the region
(H) Perform such other functions as may be provided by law and as may be delegated by the
Commissioner.
43.Section 11
Duties of Revenue District Officers and Other Internal Revenue Officers
44. Section 11. Duties of Revenue District Officers and Other Internal Revenue Officers
It shall be the duty of every Revenue District Officer to examine the efficiency of all officers
and employees of the Bureau of Internal Revenue under his supervision, and to report in
writing to the Commissioner, through the Regional Director, any neglect of duty,
incompetency, delinquency, or malfeasance in office of any internal revenue officer of which
he may obtain knowledge, with a statement of all the facts and any evidence sustaining each
case.
45. Section 12
Agents and Deputies for Collection of National Internal Revenue Taxes
46. The following are hereby constituted agents of the Commissioner:

(a) The Commissioner of Customs and his subordinates with respect to the collection of
national internal revenue taxes on imported goods;
(b) The head of the appropriate government office and his subordinates with respect to the
collection of energy tax
(c) Banks duly accredited by the Commissioner with respect to receipt of payments internal
revenue taxes authorized to be made thru banks
47. Section 13
Authority of a Revenue Officer
48. Section 13. Authority of a Revenue Officer. –

examine taxpayers within the jurisdiction of the district in order to collect the correct amount
of tax, or to recommend the assessment of any deficiency tax due in the same manner that
the said acts could have been performed by the Revenue Regional Director himself.
49. Section 14
Authority of Officers to Administer Oaths and Take Testimony
50.Section 15
Authority of Internal Revenue Officers to Make Arrests and Seizures
51. who shall have authority to make arrests and seizures for the violation of any penal law,
rule or regulation administered by the Bureau of Internal Revenue?
The Commissioner, the Deputy Commissioners, the Revenue Regional Directors, the Revenue
District Officers and other internal revenue officers:
52. Section 16
Assignment of Internal Revenue Officers Involved in Excise Tax Functions to Establishments
Where Articles Subject to Excise Tax are Produced or Kept
53. Section 16. Assignment of Internal Revenue Officers Involved in Excise Tax Functions to
Establishments Where Articles Subject to Excise Tax are Produced or Kept
That an internal revenue officer assigned to any such establishment shall in no case stay in his
assignment for more than two (2) years, subject to rules and regulations to be prescribed by
the Secretary of Finance, upon recommendation of the Commissioner:
54.Section 17
Assignment of Internal Revenue Officers and Other Employees to Other Duties
55. Section 17. Assignment of Internal Revenue Officers and Other Employees to Other Duties.
That internal revenue officers assigned to perform assessment or collection function shall not
remain in the same assignment for more than three (3) years: Provided, further, That
assignment of internal revenue officers and employees of the Bureau to special duties shall
not exceed one (1) year:
56. Section 18
Reports of Violation of Laws:
57. Section 18. Reports of Violation of Laws.

When an internal revenue officer discovers evidence of a violation of this Code or of any law
he shall immediately report the facts to the Commissioner, through his immediate superior,
giving the name and address of the offender and the names of the witnesses, if possible:
Provided, That in urgent cases, the Revenue Regional Director or Revenue District Officer, as
the case may be, may send the report to the corresponding prosecuting officer:
58. Section 19
Contents of Commissioner's Annual Report
59. Section 19. Contents of Commissioner's Annual Report

The Annual Report of the Commissioner shall contain detailed statements of the collections
of the Bureau with specifications of the sources of revenue by type of tax, by manner of
payment, by revenue region and by industry group and its disbursements by classes of
expenditures. In case the actual collection exceeds or falls short of target as set in the annual
national budget by fifteen percent (15%) or more, the Commissioner shall explain the reason
for such excess or shortfall.:
(15%) exceeds or falls short or more, the Commissioner shall explain the reason for such
excess or shortfall.:
60. Section 20
Submission of Report and Pertinent Information by the Commissioner
61. - Submission of Pertinent Information to Congress

The provision of Section 270 of this Code furnish its appropriate Committee pertinent
information including but not limited to: industry audits, collection performance data, status
reports in criminal actions initiated against persons and taxpayer's returns
62. Report to Oversight Committee

The Commissioner shall, with reference to Section 204 of this Code, submit to the Oversight
Committee a report on the exercise of his powers pursuant to the said Section,
every six (6) months of each calendar year.:
63. Section 21
Sources of revenue for federal government:
64. Sources of Revenue. – The following taxes, fees and charges are deemed to be national
internal revenue taxes
(a) Income tax; (b) Estate and donor's taxes; (c) Value-added tax; (d) Other percentage taxes;
(e) Excise taxes; (f) Documentary stamp taxes; and (g) Such other taxes as are or hereafter
may be imposed and collected by the Bureau of Internal Revenue.
65. Section 22
Definitions
66. means an individual, a trust, estate or corporation

Person
67. shall include partnerships, no matter how created or organized, joint-stock companies, joint
accounts (cuentas en participacion), associations, or insurance companies, but does not include
general professional partnerships and a joint venture or consortium formed for the purpose of
undertaking construction projects or engaging in petroleum, coal, geothermal and other energy
operations pursuant to an operating consortium agreement under a service contract with the
Government.
Corporation
68. are partnerships formed by persons for the sole purpose of exercising their common
profession, no part of the income of which is derived from engaging in any trade or business.
General professional partnerships
69. when applied to a corporation, means created or organized in the Philippines or under its
laws
Domestic
70. when applied to a corporation, means a corporation which is not domestic

Foreign
71. means an individual whose residence is within the Philippines and who is not a citizen
thereof
resident alien
72. means an individual whose residence is not within the Philippines and who is not a citizen
thereof.
non-resident alien
73. applies to a foreign corporation engaged in trade or business within the Philippines
resident foreign corporation
74. applies to a foreign corporation not engaged in trade or business within the Philippines.
non-resident foreign corporation
75. means a guardian, trustee, executor, administrator, receiver, conservator or any person
acting in any fiduciary capacity for any person
Fiduciary
76. means any person required to deduct and withhold any tax under the provisions of Section
57
withholding agent
77. shall include shares of stock of a corporation, warrants and/or options to purchase shares of
stock, as well as units of participation in a partnership (except general professional
partnerships), joint stock companies, joint accounts, joint ventures taxable as corporations,
associations and recreation or amusement clubs (such as golf, polo or similar clubs), and mutual
fund certificates
shares of stock
78. shall include holders of a share/s of stock, warrant/s and/or option/s to purchase shares of
stock of a corporation, as well as a holder of a unit of participation in a partnership (except
general professional partnerships) in a joint stock company, a joint account, a taxable joint
venture, a member of an association, recreation or amusement club (such as golf, polo or
similar clubs) and a holder of a mutual fund certificate, a member in an association, joint-stock
company, or insurance company
Shareholder
79. means any person subject to tax imposed by this Title

Taxpayer
80. shall not be deemed to exclude other things otherwise within the meaning of the term
defined
'including' and 'includes'
81. means the calendar year, or the fiscal year ending during such calendar year, upon the basis
of which the net income is computed under this Title 82. Taxable year: includes, in the case of a
return made for a fractional part of a year under the provisions of this Title or under rules and
regulations prescribed by the Secretary of Finance, upon recommendation of the
Commissioner, the period for which such return is made
taxable year
83. means an accounting period of twelve (12) months ending on the last day of any month
other than December
fiscal year
84. shall be construed according to the method of accounting upon the basis of which the net
income is computed under this Title.
'paid or incurred' and 'paid or accrued
85. includes the performance of the functions of a public office.

trade or business
86. means shares of stock in a corporation and rights to subscribe for or to receive such shares.
The term includes bonds, debentures, notes or certificates, or other evidence or indebtedness,
issued by any corporation, including those issued by a government or political subdivision
thereof, with interest coupons or in registered form.
Securities
87. means a merchant of stocks or securities, whether an individual, partnership or

corporation, with an established place of business, regularly engaged in the purchase of
securities and the resale thereof to customers; that is, one who, as a merchant, buys securities
and re-sells them to customers with a view to the gains and profits that may be derived
therefrom.
dealer in securities
88. means every banking institution, as defined in Section 2 of Republic Act No. 337, as
amended, otherwise known as the "General Banking Act". A bank may either be a commercial
bank, a thrift bank, a development bank, a rural bank or specialized government bank
Bank
89. means a financial intermediary, as defined in Section 2(D)(c) of Republic Act No. 337, as
amended, otherwise known as the General Banking Act, authorized by the Bangko Sentral ng
Pilipinas (BSP) to perform quasi-banking activities.
non-bank financial intermediary
90. means borrowing funds from twenty (20) or more personal or corporate lenders at any one
time, through the issuance, endorsement, or acceptance of debt instruments of any kind other
than deposits for the borrower's own account, or through the issuance of certificates of
assignment or similar instruments, with recourse, or of repurchase agreements for purposes of
relending or purchasing receivables and other similar obligations
quasi-banking activities
91. shall mean an alternative form of obtaining funds from the public (the term 'public' means
borrowing from twenty (20) or more individual or corporate lenders at any one time) other
than deposits, through the issuance, endorsement, or acceptance of debt instruments for the
borrower's own account, for the purpose of relending or purchasing of receivables and other
obligations, or financing their own needs or the needs of their agent or dealer
deposit substitutes
92. These instruments may include, but need not be limited to bankers' acceptances,
promissory notes, repurchase agreements, including reverse repurchase agreements entered
into by and between the Bangko Sentral ng Pilipinas (BSP) and any authorized agent bank,
certificates of assignment or participation and similar instruments with recourse: Provided,
however, That debt instruments issued for interbank call loans with maturity of not more than
five (5) days to cover deficiency in reserves against deposit liabilities, including those between
or among banks and quasi-banks, shall not be considered as deposit substitute debt
instruments.
debt instruments
93. includes any gain from the sale or exchange of property which is not a capital asset or
property described in Section 39(A)(1). Any gain from the sale or exchange of property which is
treated or considered, under other provisions of this Title, as 'ordinary income' shall be treated
as gain from the sale or exchange of property which is not a capital asset as defined in Section
39(A)(1)
ordinary income
94. includes any loss from the sale or exchange of property which is not a capital asset. Any loss
from the sale or exchange of property which is treated or considered, under other provisions of
this Title, as 'ordinary loss' shall be treated as loss from the sale or exchange of property which
is not a capital asset.
ordinary loss
95. shall mean all employees who are holding neither managerial nor supervisory position as
defined under existing provisions of the Labor Code of the Philippines, as amended.
rank and file employees
96. shall mean an open-end and close-end investment company as defined under the
Investment Company Act
mutual fund company
97. shall not include performance of services by the taxpayer as an employee

trade, business or profession
98. shall mean a branch established in the Philippines by multinational companies and which
headquarters do not earn or derive income from the Philippines and which act as supervisory,
communications and coordinating center for their affiliates, subsidiaries, or branches in the
Asia-Pacific Region and other foreign markets
regional or area headquarters
99. shall mean a branch established in the Philippines by multinational companies which are
engaged in any of the following services: general administration and planning; business
planning and coordination; sourcing and procurement of raw materials and components;
corporate finance advisory services; marketing control and sales promotion; training and
personnel management; logistic services; research and development services and product
development; technical support and maintenance; data processing and communications; and
business development
regional operating headquarters
100. shall refer to certificate of time deposit or investment in the form of savings, common or
individual trust funds, deposit substitutes, investment management accounts and other
investments with a maturity period of not less than five (5) years, the form of which shall be
prescribed by the Bangko Sentral ng Pilipinas (BSP) and issued by banks only (not by nonbank
financial intermediaries and finance companies) to individuals in denominations of Ten
thousand pesos (PhP10,000) and other denominations as may be prescribed by the BSP.
long-term deposit or investment certificate
101. earner shall refer to rate fixed by the Regional Tripartite Wage and Productivity Board, as
defined by the Bureau of Labor and Employment Statistics (BLES) of the Department of Labor
and Employment (DOLE)
statutory minimum wage
102. shall refer to a worker in the private sector paid the statutory minimum wage, or to an
employee in the public sector with compensation income of not more than the statutory
minimum wage in the non-agricultural sector where he/she is assigned
minimum wage earner
103. Section 23
General Principles of Income Taxation in the Philippines
104. Section 24
Income Tax Rates
105. Not over PhP250,000

0%
106. Over PhP250,000 but not over PhP400,000

15% of the excess over PhP250,000
107. Over PhP400,000 but not over PhP800,000

PhP22,500 + 20% of the excess over PhP400,000
108. Over PhP800,000 but not over PhP2,000,000

PhP102,500 + 25% of the excess over PhP800,000
109. Over PhP2,000,000 but not over PhP8,000,000

PhP402,500 + 30% of the excess over PhP2,000,000
110. Over PhP8,000,000

PhP2,202,500 + 35% of the excess over PhP8,000,000
111. Self-employed individuals and/or professionals shall have the option to avail...
of an eight percent (8%) tax on gross sales or gross receipts and other non-operating income
in excess of Two hundred fifty thousand pesos (PhP250,000) in lieu of the graduated income
tax rates under Subsection (A) (2)(a) of this Section and the percentage tax under Section 116
of this Code.
112. Rate of Tax for Mixed Income Earners. - Taxpayers earning both compensation income and
income from business or practice of profession shall be subject to the following taxes
(1) All Income from Compensation
(2) All Income from Business or Practice of Profession
113. Royalties
20%
114. books, as well as other literary works and musical compositions
10%
115. prizes
10%
116. Cash and/or Property Dividends
10%
117. Capital Gains from Sale of Shares of Stock not Traded in the Stock Exchange
15%
118. Capital Gains from Sale of Real Property
6%
119. Section 25
Tax on Non-resident Alien Individual
120. Section 26
Tax Liability of Members of General Professional Partnerships
121. Section 27
Rates of Income Tax on Domestic Corporations
122. Section 28
Rates of Income Tax on Foreign Corporations
123. Tax on Resident Foreign Corporations

30%
124. Minimum Corporate Income Tax on Resident Foreign Corporations.

2%
125. International Carrier
21/2 %
126. Tax on Branch Profits Remittances

15%
127. Regional operating headquarters
10%
128. Capital Gains from Sale of Shares of Stock Not Traded in the Stock Exchange
Not over PhP100,000 .... 5% On any amount in excess of PhP100,000 .... 10%
129. Non-resident Cinematographic Film Owner, Lessor or Distributor
25%
130. Non-resident Owner or Lessor of Vessels Chartered by Philippine Nationals
4 1/2%
131. Nonresident Owner or Lessor of Aircraft, Machineries and Other Equipment
(7 1/2%) of gross rentals or fees
132. Interest on Foreign Loans
20%
133. Intercorporate Dividends
15%
134. Section 29.
Imposition of Improperly Accumulated Earnings Tax
135. Section 30
Exemptions from Tax on Corporations
136. Section 31
Taxable Income Defined
137. means the pertinent items of gross income specified in this Code, less deductions, if any,
authorized for such types of income by this Code or other special laws.
taxable income
SET B
1.: an asset bought to be kept for a long period of time and not intended for immediate sale.
Capital Asset
2. assets that are used in trade or business. Subject to depreciation.

Ordinary Asset:
3. real properties acquired by BANKS through FORECLOSURE sales are considered as

_________.
Ordinary Asset
4: engaged in the business of buying and selling or exchanging real properties.

Real Estate Dealer
5. engaged in the business of developing real properties into subdivisions, or building houses on
subdivided lots.
Real Estate Developer
6. engaged in the business of leasing or renting real estate properties.

Real Estate Lessor
7. sale of real properties classified as ordinary asset at the time of sale is subject to.
Income Tax
8. sale of capital asset is subject to.

Capital Gains Tax
9. it is a final withholding tax.
Capital Gains Tax
10. sale of real property the initial payments of which in the year does not exceed 25% of gross
selling price.
Installment Payment
11. sale of real property the initial payments of which in the year exceed 25% of gross selling
price.
Deferred Payment
12. payment or payments which the seller receives before or upon the execution of the
installment of sale during the calendar year when the sale of the real property was made.
Initial Payment
13. tax imposed on the gains presumed to have been realized by the seller from the sale,
exchange, or other disposition of real property.
Capital Gains Tax
14 system of collecting taxes whereby the amount of income tax withheld by the withholding
agent is constituted as a full and final payment of the income tax due from the payer of the said
income. .
Final Withholding Tax
15. basis for tax computation.

Tax Base
16. fair market value as determined by the Commissioner (BIR)

Zonal Value
17. rate of capital gains tax for real property

6%
18. date of filing of the return after each sale or disposition of real property.
30 Days
19. date of filing of the return following the receipt of the first downpayment.
30 Days
20. AAB
Authorized Agent Bank
21. certification issued by the Commissioner or his duly authorized representative attesting that
the transfer and conveyance of land, buildings/improvements arising from the sale, barter or
exchange have been reported and the taxes due inclusive of the documentary stamp tax have
been fully paid.
Certificate Authorizing Registration
22. acquisition or construction of new principal residence shall be done within ______ from
Date of Sale.
18 calendar months
23. the dwelling house, including the land on which it is situated, where the husband and wife
or an unmarried individual, whether or not qualified as head of family, and members of his
family reside.
Principal Residence
24. means a scroll, writing or deed, delivered by the grantor, promisor or obligor into the hands
of a third person, to be held by the latter until the happening of a contingency or performance
of a condition, and then by him delivered to the grantee, promisee or obligee.
Escrow
25. exemption from capital gains tax of sale of principal residence shall be once every _______.
10 years
26. delinquency or failure to pay CGT.

Deficiency Capital Gains Tax
27. penalty for late payment of CGT shall be 25% surcharge and 20% interest per annum. If
intentional 50% surcharge and 20% interest per annum.
25%, 20%, 50%, 20%
28. system of collecting taxes whereby the taxes withheld on certain income payments are
intended to equal or at least approximate the tax due of the payee on said income.
Expanded Withholding Tax
29. is an advance income tax.

Expanded Withholding Tax
30. refers to selling price exclusive of interest

Consideration
31. Rent income payments subject to creditable withholding tax.

5%
32. income payments to certain brokers or agents P720k and below.

10%
33. income payments to certain brokers or agents P720k and above.
15%
34. seller habitually engaged in real estate business with selling price of P500k or less
1.5%
35. seller habitually engaged in real estate business with selling price of P500k - P2M.
3%
36. seller habitually engaged in real estate business with selling price of more than P2M.
5%
37. seller habitually engaged in real estate business with selling price of not more than 450k.
Exempt
38. date of filing for creditable withholding tax is within _____ after the end of each month
10 days
39. date of filing for taxes withheld for December is on or before ________ of the following
year
January 15
40. penalty for non-payment of withholding is ______ of amount due

25%
41. penalty for willful neglect of non-payment of withholding is ______ of amount due
50%
42. a tax on documents, instruments, loan agreements and papers evidencing the acceptance,
assignment, sale or transfer of an obligation, rights or property incident thereto.
Documentary Stamp Tax
43. filing of tax return on documentary stamp tax is within _____ of the following month
5 days
44. DST on SALE

1.5%
45. DST on LEASE; ____ for the first P2,000, ____ succeeding P1,000.
P3.00, P1.00:
46. DST on MORTGAGE; ____ for first P5,000, ____ for succeeding P5,000.
P20.00, P10.00:
47. Transfer tax for cities and municipalities 3/4%:
48Transfer tax for provinces. 1/2%:
49. imposed on one's right to make casual and gratuitous transfer of one's property to another
person.
Transfer Tax
50. date of payment of transfer tax, not more than ___ days from date of sale.
60 days:
51. is a form of sales tax on consumption levied on the sale, barter, exchange or lease of goods
or properties and services in the Philippines and on importation of goods into the Philippines.
Value Added Tax:
52. a person or entity whose trade or business sells, barters, exchanges or leases goods or
services will be required to pay VAT if amount EXCEEDS ________.
1,919,500
53. lease of residential units with monthly rental per unit not exceeding _______ shall be
EXEMPTED from VAT .
12,800
54. for rentals that does not exceed P1,919,500 is subject to.
3% percentage tax
55. deadline for the payment of VAT shall be not later than the ____ day of the following
month
20th day
56. deadline for payment of quarterly VAT is within _____ following the close of taxable quarter
25 days
57. registration and annual fee for VAT tax payer

P500
58. annual registration fee of VAT taxpayer is not later than _________ of every year
January 31
59. the VAT due when you sale, lease or exchange of taxable goods, properties or services by
any person registered. (What you collect when you sell)
Output Tax
60. the Vat due on or paid by a VAT registered on importation of goods or local purchase of
goods, properties or services, including lease or use of property in the course of his trade or
business. (What you pay when you buy).
Input Tax
61. it is a sale of goods, properties or service and the use or lease of properties which is not
subject to output tax and whereby the buyer is not allowed any tax credit or input tax related
to such exempt of sale.
VAT Exempt Sale
62. sale value of residential LOT that is VAT exempt

P1,919,500 and below
63. sale value of residential HOUSE and LOT that is VAT exempt
P3,199,200 and below
64. tax paid by the heirs on the total value of the estate left behind by a taxpayer who died.
Estate Tax
65. rate of excise tax for value of net estate from 0 - P200,000
Exempt
66. rate of excise tax for value of net estate from P200,000 - P500,000 plus ____ in excess of
P200,000
0, 5%
67. rate of excise tax for value of net estate from P500,000 - P2M plus ____ in excess of
P500,000
P15,000, 8%
68. rate of excise tax for value of net estate from P2M - P5M plus ____ in excess of P2M.
P135,000, 11%
69. rate of excise tax for value of net estate from P5M - P10M plus ____ in excess of P5M.
P465,000, 15%
70. rate of excise tax for value of net estate from P10M and over plus ____ in excess of P10M.
P1,215,000, 20%
71. deductions allowed to the estate of a citizen or resident for funeral expenses or in the
amount equal to ____ of the gross estate, which ever is lower, but not to exceed ________.
5%, P200,000
72. the value at the time of death of all property, real or personal, tangible or intangible,
wherever situated.
Value of Gross Estate
73. for claims against the estate provided that the instrument of indebtedness was duly
notarized and if the loan was contracted within ____ before death of decedent, the
administrator shall submit a statement showing the disposition of the proceeds of the loan
3 years
74. an amount equivalent to the fair market value of the family home not to exceed _________.
1 Million
75. a standard equivalent to _________.

1 Million
76. date of filing of notice of death is within ______ after the decedent's death
2 months
77. medical expenses of not more than ________ incurred by the decedent within ________
prior to his death.
500T, 1 year
78. notice of death should be filed if the gross value of the estate exceeds ________.
P20,000
79. filing of estate returns shall be within _________ from the decedent's death.
6 months
80. extention of time not to exceed ______ in case the estate is settled through courts or
_______ if settled extra-judicially.
5 years, 2 years
81. tax paid by one who conveys property or gift to another without a consideration. Total gifts
made during the calendar year.
Donor's Tax
82. donor's tax rate for total net gifts from P0 - P100,000
Exempt
83. donor's tax rate for total net gifts from P100,000 - P200,000 plus ____ over P100,000.
0, 2%
84. donor's tax rate for total net gifts from P200,000 - P500,000 plus ____ over P200,000.
P2,000, 4%
85. donor's tax rate for total net gifts from P500,000 - P1M plus ____ over P500,000.
P14,000, 6%
86. donor's tax rate for total net gifts from P1M to P3M plus ____ over P1M.
P44,000, 8%
P204,000, 10%
P404,000, 12%
89. donor's tax rate for total net gifts from P10M plus ____ over P10M.
P1,004,000, 15%
90. a person who is not a brother, sister, spouse, ancestor and lineal descendant; or relative by
consanguinity in the collateral line within the 4th degree of relationship
Stranger
91. if donee is a STRANGER the tax payable shall be ____ of the net gifts.
30%
92. exemption from donor's tax: dowries or gifts made on account of marriage and before its
celebration or within 1 YEAR thereafter by parents to each the legitimate, recognised natural or
adopted children to the extent of the FIRST ________.
P10,000
93. Donor's tax to be filed within ______ after the date the gift is made and the tax due thereon
shall be paid at the time of filing.
30 days
94. BIR Form ____ Withholding Tax Remittance Return 1606

95. BIR Form ____ Monthly VAT Declaration 2550M
96. BIR Form ____ Quarterly VAT Declaration 2550Q
97. is any person or entity who is required to deduct and remit the taxes withheld to the
government.
Withholding Agents
98. prepares the schedule of the FMV in the municipalities of Metro Manila.
Concerned Municipal Assessors
99. refers to the exchange of property for a monetary consideration or a transfer of goods or
services in return for something of equal value.
Onerous Transfer of Property
100. is conveyance of property without any consideration involved in exchange for the property
given away.
Gratuitous Transfer of Property
SET C
1. Which of the following is true with respect to real property taxation by the federal
government?
A. It may impose ad valorem property taxes and capital gain tax.

B. It may not impose property taxes nor tax liens.
C. There are no federal ad valorem taxes on real property.
D. It may impose ad valorem tax, but not capital gain tax.
C. There are no federal ad valorem taxes on real property.
2. According to law, states
A. may not levy real estate taxes.

B. may not impose tax liens.
C. may delegate taxing authority to county governments.
D. may prevent federal taxation of real estate within their respective jurisdictions, if properly
legislated.
C. may delegate taxing authority to county governments.
3. The role of local tax districts is to
A. levy income, sales, and property taxes to meet their budget requirements.
B. manage their budgeted portion of real estate tax revenues levied and distributed by the
state.
C. impose property taxes for specific municipal services.
D. place tax liens on its facilities.
C. impose property taxes for specific municipal services.
4. A special tax district might be created to
A. construct and manage a park district.

B. create a two-mile extension of county sewer facilities.
C. establish and maintain a public library.
D. create a fire department.
B. create a two-mile extension of county sewer facilities.
5. Ad valorem taxes are based on
A. the replacement value of property.
B. the assessed value of property.
C. the millage value of property.
D. the broker's estimate of value.
B. the assessed value of property.
6. The ad valorem tax base of a municipal jurisdiction is equal to
A. the jurisdiction's annual budget times the tax rate.

B. the total of all assessed values of properties minus exemptions.
C. the total amount of ad valorem taxes required by the budget.
D. the municipality's budget multiplied times the millage rate.
B. the total of all assessed values of properties minus exemptions.
7. As part of the assessment process, many taxing entities utilize equalization boards in order
to
A. adjust millage rates within the district to ensure fairness.

B. modify the tax rate from one neighborhood to the next.
C. ensure that property owners have nearly equal tax bills.
D. smooth out wide discrepancies of assessed values within the district.
D. smooth out wide discrepancies of assessed values within the district.
8. A homeowner receives a tax bill that she feels is outrageous. This taxpayer may
A. appeal to adjust the millage rate.

B. appeal to adjust the district's budget.
C. appeal to adjust the assessed valuation.
D. not appeal.
C. appeal to adjust the assessed valuation.
9. The purpose of a homestead tax exemption is
A. to exempt qualified property owners from ad valorem taxation.

B. to offer an amount of tax relief on an owner's principal residence.
C. to encourage multiple property investment.
D. to exempt owners of principal residences who rent their properties.
B. to offer an amount of tax relief on an owner's principal residence.
10. A millage rate is derived by
A. dividing the tax requirement by the tax base.

B. multiplying the tax base times the tax requirement.
C. adding an inflation factor to the prior year's tax rate.
D. dividing the tax base by the tax requirement.
11. A homeowner's total tax bill is derived by

B. multiplying each district's tax rate times the assessed value of the property.
C. multiplying each district's tax rate times the taxable value of the property.
D. averaging the tax rate for each tax district, and multiplying the average tax rate times the
assessed value.
C. multiplying each district's tax rate times the taxable value of the property.
12. A unique characteristic of a special assessment tax is that
A. it only applies to properties which will benefit from the public improvement.
B. the equalization board discounts levies for properties not affected by the public
improvement.
C. more valuable properties which stand to benefit will pay proportionately more taxes.
D. it creates an involuntary junior lien on the property.
A. it only applies to properties which will benefit from the public improvement.
13. A tax certificate
A. certifies to tax collectors that a property owner has paid all ad valorem taxes on the
property for the calendar year.
B. entitles its holder to apply for a tax deed after a certain period.
C. exempts its holder from paying taxes on the particular property referenced by the
certificate.
D. waives a property owner's rights of redemption in a foreclosure.
B. entitles its holder to apply for a tax deed after a certain period.
14. An equitable right of redemption
A. allows a holder of a tax certificate to redeem it for a tax deed.

B. gives a delinquent taxpayer a grace period prior to the tax sale to pay property taxes.
C. gives a holder of a tax deed the right to acquire the property named in the tax certificate.
D. gives a delinquent taxpayer a grace period after the tax sale to pay property taxes.
B. gives a delinquent taxpayer a grace period prior to the tax sale to pay property taxes.
SET D
1. Capital gains tax: Is the tax imposes in lieu of the income tax on the profits presumed to have
been realized in the sale, exchange or disposition of real property classified as capital asset by
an individual, estate or trust
2. Fair market value and Zoning: Valuation used by thr BIR as the basis for computing the
capital gains or expanded withholding tax other than the actual selling price.
3. C: Which information is false?
a) CGT is 6% of the total contract price or zonal value whichever is higher
b) DST is 1.5% of the total contract price or zonal value whichever ia higher
c) Transfer fee at 1.5 % of the total contract price or zonal value whichever is higher d) Pasig
City and Quezon City imposes business tax on sales of real estate titled to corporations
4. Capital asset: Under Revenue Memorandum Circular No 1-98, a corporation is now subject
to CGT if it sold real estate classified as _________
5. Tax: An enforced proportionate imposes upon a person, property or interest by the
legislature for a public purpose and generally payable in money
6. Documentary stamp tax: A tax affixed on documents, instruments and papers evidencing the
acceptance, assignment or sale of a right, obligation or property
7. More than 25%: Sale of real property with ____ down payment is considered a cash sale
which requires full payment of the CGT before the sale can be registered 8. D: The sale and
transfer of title from a real estate DEALER to a buyer of a house and lot at P4M is subject to ff
tax except
a) creditable withholding tax
b) transfer and registration fees
c) expanded value added tax
d) capital gains tax
e) DST
9. 5: Unless validated, tax credit life span is only for ___ years
10. CGT: Tax on sale of real property classified as capital asset
11. Statutory seller: In a foreclosure, the creditor bank is the ____ and as suxh liable to pay the
CGT based on the bid price
12. Taxation: Inherent power of State acting through legislature to impose and collect revenue
for the purpose of supporting the government and its recognized objectives
13. Percentage tax: The lease of house and lot with rental of P10k per month, which is the sole
income of the owner shall subject to ____ .
14. 3%: The expanded withholding tax rate on the sale of house and lot package by a developer
at the price of P2M
15. Fully, 18: Under RAMO No 1-98, an individual can now be exempted in paying CGT if the
proceeds from the sale shall be ____ utilized in acquiring or constructing new principal
residence within ___ months
16. 6: A person is considered habitually engaged in real estate business if he should offer
satisfactory evidence that he consummated at least ____ taxable rea estate transactions during
the preceding year.
17. Tax base, within 30 days after each sale, 25%: CGT of 6% shall be based on ____ and shall
be paid on ___ . Payment after the said period is subject to ___% penalty
18. 11187500: If the expenses for the payment of CGT and DST and 3% broker's commissiin will
be shouldered by the vendor, how much will be the net amount he will receive if he sells the
property worth P12.5M?
19. 20%: Per BIR 28-98, the ground floor of a condominium project shall be considered as
commercial and an additional rate of ___% shall be added to an established residential zonal
value.
20. LGU treasurer: The transfer tax in the sale of real estate properties is paid at ____.
21. Ordinary assets: Classification of bank's asset acquired which form part if its real estate
inventories at close of acctg period.
22. P3:P2000:P1: The documentary stamp on lease of real estate is ___ for the first _____ or
fraction thereof and additional ___ for every P1000 in excess for first P2000.
23. P20:P10: The documentary stamp on every mortgage or pledge of real estate is ____ for the
first P5000 plus ____ for every P5000 or fraction thereof in the excess of the first P5000.
24. Execution of deed of sale: In case of sale of real property paid under deferred payment
basis, the payment of the DST shall accrue upon ____
25. P3300: The creditable withholding tax in the sale of real estate dealer of a household lot
priced at P220000 is ____
26. P45000: The withholding tax for a property sold by a real estate dealer worth P1.5M
27. 30 days: To avail exemption from CGT in sale of family home, the seller is required to notify
the BIR within __ from the date of sale.
28. Within 5 days after the close of month: After a Deed of Absolute Sale was made, signed
and notarized when the DST on sale of real property be paid?
29. Ordinary asset: Property held by the owner as inventory or stock in trade of buy and sell
business or used in connectiin with trade, business or source of income is referred to as __
30. P30000: The CGT due on the sale P2M property with P500k initial payment is ___
31. 50%: Surcharged based on the taxes or deficiency tax in case of false or fraudulent estate,
donor or CGT
32. 6%: Creditable withholding tax rate for the sale of real property by a person not habitually
engaged in real estate business
33. 10 years: The exemption on payment of CGT on the sale of principal residence may be
availed of only once every __
34. Certificate of Authorizing Registration: ___ is required from the BIR prior to transfer of TCT
after paying the CGT and DST
35. 100%: ___ % of the proceeds of the sale of principal residence must be utilized to be
exempt of CGT
36. More than P720000: The withholding tax of a broker becomes 15% when his accumulated
income for the year is _____
37. P1M: Amount of family home equivalent to fair market value considered as allowable
deduction from the estate of a decedent
38. 60 days: 6 months: The Estate Taxation, notice of death must be given within ___ and the
estate Return shall be filed with the BIR within ___
39. 5%, 200000: In payment of estate tax, an allowed deduction to the gross estate of a
decedent is funeral expense which is ___ of gross estate or ____ whichever is lower.
40. P1919500: Real estate brokers with an aggregate income of ____ or more within 12 month
period are required to register as VAT taxpayers.
41. P500: The annual registration fee for VAT registered real estate broker
42. P1919500, P12800: Lease of real property for residential use in the ordinary course of
business is subject to VAT when the annual gross receipt is __ and monthly rental per unit
exceeds ___
43. P3199200: Sale of residential unit (house and lot) held primarily for sale to customers in the
ordinary course of business is subject to VAT when the selling price exceeds _____.
44. P1919500: Lease of residential units with a monthly rental per unit not exceeding ___ is
exempt from VAT regardless of the aggregate rentals during the taxable year. 45. 15%:
Maximum donors tax rate
46. 30%: Tax rate on donation to stranger
47. P1M: Allowed standard deduction in addition to family home as additional deduction from
gross estate tax purposes beginning Jan.1,1998
48. Initial payment: Payment which the seller receives before or upon execution of the
installment of sale and payments which he expects or is scheduled to receive during the
calendar year
49. Deferred payment: initial payment: exceeds 25%: Sale of real property on the __ basis
means, the ___ of which in the year of sale ___ of the gross selling price 50. At least 6: How
many transactions are needed to be considered as taxpayers habitually engaged in real estate
business
51. Based on agreement : seller: All taxes to be paid in buying real properties shall be
shouldered by ___. If silent, ____.
52. Exceed 12800: exceed 1919500: In leasing residential properties, to be subjected to VAT,
monthly rental should ___ . If not the annual gross receipts must ____. 53. Current and fair
market value: Real property shall be appraised at its _____ 54. Actual use: Real property shall
be classified for ASSESSMENT purposes on the basis of its ___.
55. 2%: 36 months: Unpaid real property tax is subject to ___ per month penalty up to a
maximum period of __.
SET E
1. Capital Asset: an asset bought to be kept for a long period of time and not intended for
immediate sale.
2. Ordinary Asset: assets that are used in trade or business. Subject to depreciation.
3. Ordinary Asset: real properties acquired by BANKS through FORECLOSURE sales are
considered as _________.
4. Real Estate Dealer: engaged in the business of buying and selling or exchanging real
properties.
5. Real Estate Developer: engaged in the business of developing real properties into
subdivisions, or building houses on subdivided lots.
6. Real Estate Lessor: engaged in the business of leasing or renting real estate properties.
7. Income Tax: sale of real properties classified as ordinary asset at the time of sale is subject
to.
8. Capital Gains Tax: sale of capital asset is subject to.
9. Capital Gains Tax: it is a final withholding tax.
10. Installment Payment: sale of real property the initial payments of which in the year does
not exceed 25% of gross selling price.
11. Deferred Payment: sale of real property the initial payments of which in the year exceed
25% of gross selling price.
12. Initial Payment: payment or payments which the seller receives before or upon the
execution of the installment of sale during the calendar year when the sale of the real property
was made.
13. Capital Gains Tax: tax imposed on the gains presumed to have been realized by the seller
from the sale, exchange, or other disposition of real property.
14. Final Withholding Tax: system of collecting taxes whereby the amount of income tax
withheld by the withholding agent is constituted as a full and final payment of the income tax
due from the payer of the said income.
15. Tax Base: basis for tax computation.
16. Zonal Value: fair market value as determined by the Commissioner (BIR)
17. 6%: rate of capital gains tax for real property
18. 30 Days: date of filing of the return after each sale or disposition of real property. 19. 30
Days: date of filing of the return following the receipt of the first downpayment. 20. Authorized
Agent Bank: AAB
21. Certificate Authorizing Registration: certification issued by the Commissioner or his duly
authorized representative attesting that the transfer and conveyance of land,
buildings/improvements arising from the sale, barter or exchange have been reported and the
taxes due inclusive of the documentary stamp tax have been fully paid.
22. 18 months: acquisition or construction of new principal residence shall be done within
______ from Date of Sale.
23. Principal Residence: the dwelling house, including the land on which it is situated, where
the husband and wife or an unmarried individual, whether or not qualified as head of family,
and members of his family reside.
24. Escrow: means a scroll, writing or deed, delivered by the grantor, promisor or obligor into
the hands of a third person, to be held by the latter until the happening of a contingency or
performance of a condition, and then by him delivered to the grantee, promisee or obligee.
25. 10 years: exemption from capital gains tax of sale of principal residence shall be once every
_______.
26. Deficiency Capital Gains Tax: delinquency or failure to pay CGT.
27. 25%, 20%, 50%, 20%: penalty for late payment of CGT shall be ____ surcharge and ____
interest per annum. If intentional ____ surcharge and ____ interest per annum.
28. Expanded Withholding Tax: system of collecting taxes whereby the taxes withheld on
certain income payments are intended to equal or at least approximate the tax due of the
payee on said income.
29. Expanded Withholding Tax: is an advance income tax.
30. Consideration: refers to selling price exclusive of interest
31. 5%: Rent income payments subject to creditable withholding tax.
32. 10%: income payments to certain brokers or agents P720k and below.
33. 15%: income payments to certain brokers or agents P720k and above.
34. 1.5%: seller habitually engaged in real estate business with selling price of P500k or less
35. 3%: seller habitually engaged in real estate business with selling price of P500k - P2M.
36. 5%: seller habitually engaged in real estate business with selling price of more than P2M.
37. Exempt: seller habitually engaged in real estate business with selling price of not more than
450k.
38. 10 days: date of filing for creditable withholding tax is within _____ after the end of each
month
39. January 15: date of filing for taxes withheld for December is on or before ________ of the
following year
40. 25%: penalty for non-payment of withholding is ______ of amount due
41. 50%: penalty for willful neglect of non-payment of withholding is ______ of amount due
42. Documentary Stamp Tax: a tax on documents, instruments, loan agreements and papers
evidencing the acceptance, assignment, sale or transfer of an obligation, rights or property
incident thereto.
43. 5 days: filing of tax return on documentary stamp tax is within _____ of the following
month
44. 1.5%: DST on SALE
45. P3.00, P1.00: DST on LEASE; ____ for the first P2,000, ____ succeeding P1,000.
46. P20.00, P10.00: DST on MORTGAGE; ____ for first P5,000, ____ for succeeding P5,000.
47. 3/4%: Transfer tax for cities and municipalities
48. 1/2%: Transfer tax for provinces
49. Transfer Tax: imposed on one's right to make casual and gratuitous transfer of one's
property to another person.
50. 60 days: date of payment of transfer tax, not more than ___ days from date of sale.
51. Value Added Tax: is a form of sales tax on consumption levied on the sale, barter, exchange
or lease of goods or properties and services in the Philippines and on importation of goods into
the Philippines.
52. 1,919,500: a person or entity whose trade or business sells, barters, exchanges or leases
goods or services will be required to pay VAT if amount EXCEEDS ________.
53. 12,800: lease of residential units with monthly rental per unit not exceeding _______ shall
be EXEMPTED from VAT .
54. 3% percentage tax: for rentals that does not exceed P1,919,500 is subject to. 55. 20th day:
deadline for the payment of VAT shall be not later than the ____ day of the following month
56. 25 days: deadline for payment of quarterly VAT is within _____ following the close of
taxable quarter
57. P500: registration and annual fee for VAT tax payer
58. January 31: annual registration fee of VAT taxpayer is not later than _________ of every
year
59. Output Tax: the VAT due when you sale, lease or exchange of taxable goods, properties or
services by any person registered. (What you collect when you sell) 60. Input Tax: the Vat due
on or paid by a VAT registered on importation of goods or local purchase of goods, properties
or services, including lease or use of property in the course of his trade or business. (What you
pay when you buy).
61. VAT Exempt Sale: it is a sale of goods, properties or service and the use or lease of
properties which is not subject to output tax and whereby the buyer is not allowed any tax
credit or input tax related to such exempt of sale.
62. P1,919,500 and below: sale value of residential LOT that is VAT exempt
63. P3,199,200 and below: sale value of residential HOUSE and LOT that is VAT exempt
64. Estate Tax: tax paid by the heirs on the total value of the estate left behind by a taxpayer
who died.
65. Exempt: rate of excise tax for value of net estate from 0 - P200,000
66. 0, 5%: rate of excise tax for value of net estate from P200,000 - P500,000 plus ____ in
excess of P200,000
67. P15,000, 8%: rate of excise tax for value of net estate from P500,000 - P2M plus ____ in
excess of P500,000
68. P135,000, 11%: rate of excise tax for value of net estate from P2M - P5M plus ____ in
excess of P2M.
69. P465,000, 15%: rate of excise tax for value of net estate from P5M - P10M plus ____ in
excess of P5M.
70. P1,215,000, 20%: rate of excise tax for value of net estate from P10M and over plus ____ in
excess of P10M.
71. 5%, P200,000: deductions allowed to the estate of a citizen or resident for funeral expenses
or in the amount equal to ____ of the gross estate, which ever is lower, but not to exceed
________.
72. Value of Gross Estate: the value at the time of death of all property, real or personal,
tangible or intangible, wherever situated.
73. 3 years: for claims against the estate provided that the instrument of indebtedness was
duly notarized and if the loan was contracted within ____ before death of decedent, the
administrator shall submit a statement showing the disposition of the proceeds of the loan
74. 1 Million: an amount equivalent to the fair market value of the family home not to exceed
_________.
75. 1 Million: a standard equivalent to _________.
76. 2 months: date of filing of notice of death is within ______ after the decedent's death
77. 500T, 1 year: medical expenses of not more than ________ incurred by the decedent within
________ prior to his death.
78. P20,000: notice of death should be filed if the gross value of the estate exceeds ________.
79. 6 months: filing of estate returns shall be within _________ from the decedent's death.
80. 5 years, 2 years: extention of time not to exceed ______ in case the estate is settled
through courts or _______ if settled extra-judicially.
81. Donor's Tax: tax paid by one who conveys property or gift to another without a
consideration. Total gifts made during the calendar year.
82. Exempt: donor's tax rate for total net gifts from P0 - P100,000
83. 0, 2%: donor's tax rate for total net gifts from P100,000 - P200,000 plus ____ over P100,000.
84. P2,000, 4%: donor's tax rate for total net gifts from P200,000 - P500,000 plus ____ over
P200,000.
85. P14,000, 6%: donor's tax rate for total net gifts from P500,000 - P1M plus ____ over
P500,000.
86. P44,000, 8%: donor's tax rate for total net gifts from P1M to P3M plus ____ over P1M.
89. P1,004,000, 15%: donor's tax rate for total net gifts from P10M plus ____ over P10M.
90. Stranger: a person who is not a brother, sister, spouse, ancestor and lineal descendant; or
relative by consanguinity in the collateral line within the 4th degree of relationship
91. 30%: if donee is a STRANGER the tax payable shall be ____ of the net gifts. 92. P10,000:
exemption from donor's tax: dowries or gifts made on account of marriage and before its
celebration or within 1 YEAR thereafter by parents to each the legitimate, recognised natural or
adopted children to the extent of the FIRST ________.
93. 30 days: Donor's tax to be filed within ______ after the date the gift is made and the tax
due thereon shall be paid at the time of filing.
94. 1606: BIR Form ____ Withholding Tax Remittance Return
95. 2550M: BIR Form ____ Monthly VAT Declaration
96. 2550Q: BIR Form ____ Quarterly VAT Declaration
97. Withholding Agents: is any person or entity who is required to deduct and remit the taxes
withheld to the government.
98. Concerned Municipal Assessors: prepares the schedule of the FMV in the municipalities of
Metro Manila.
99. Onerous Transfer of Property: refers to the exchange of property for a monetary
consideration or a transfer of goods or services in return for something of equal value.
100. Gratuitous Transfer of Property: is conveyance of property without any consideration
involved in exchange for the property given away.
SET F
1. Tax base, Not later than 30 days after notarisation, 25%: Capital Gains Tax of six percent
(6%) shall be based on ________, and shall be paid on not later than ________. Payment after
said period is subject to ___ penalty.
2. Capital Gains Tax: ________ is the tax imposed in lieu of the income tax on the profits
presumed to have been realized in the sale, exchanged or disposition of real property classified
as capital asset by an individual, estate or trust.
3. Zonal: ________ valuation is used by the BIR as the basis for computing the capital gains tax
or expanded withholding tax other than the actual selling price. 4. C: Which information is
false?
a. Capital gains tax is 6% of the total contract price or zonal value whichever is higher.
b. Documentary stamp tax is 1.5% of the total contract price or zonal value whichever is higher.
c. Transfer fee is computed at 1.5% of the total contract price or zonal value whichever is
higher.
d. Pasig city and Quezon City imposes a Business Tax on sales of real estate titled to corporation
5. Capital Asset: Under Revenue Memorandum Circular No. 1-98, a corporation is now subject
to capital gains tax if it sold real estate property classified as ________. 6. 18 months: Under
MRO No. 1-98, an individual can now be exempted in paying capital gains tax if the proceeds of
the sale shall be fully utilized in acquiring or constructing a new principal residence within
________.
7. Tax: An enforced proportionate contribution imposed upon a person property or interest by
the legislature for a public purpose and generally payable in money is called ________.
8. Documentary stamp tax: A tax affixed on documents, instruments and papers evidencing the
acceptance, assignment or sale of a right, property or obligation is called ________.
9. 6: For purposes of determining whether a seller/transferor can be considered as habitually
engaged in real estate business, he should offer satisfactory evidence that he consummated at
least ___ taxable real estate transactions during the preceding year.
10. More than 25%: Sale of real property with ________ down payment is considered as a
cash sale which requires full payment of capital gains tax before the sale can be registered.
11. D: The sale and transfer of the title from a real estate dealer to a buyer of a house and lot at
P4,000,000 is subject to the following EXCEPT:
a. Creditable withholding tax
b. Transfer and registration fees
d. Capital gains tax

e. Documentary stamp tax
12. 5 years: Unless validated, tax credit life span is only for ________.
13. Final withholding tax: The tax in sale of real property classified as capital asset is a
________.
14. Statutory seller: In a foreclosure sale, the creditor bank is the ________ and as such is liable
to pay the capital gains tax based on the bid price.
15. Taxation: ________ is the inherent power of the State acting through the legislature, to
impose and collect revenue for the purpose of supporting the government and its recognized
objectives.
16. Percentage tax: The lease of house & lot with a rental of P100,000 per month, which is the
sole income of the owner, shall be subjected to ________.
17. 3%: The expanded W/H tax rate on the sale of house and lot package by a developer at
price of two million pesos is ___.
18. 11187500: If the expenses for the payment of capital gains and documentary stamps tax
and 3% broker's commission will be shouldered by the vendor, how much will be the net
amount he will receive if he sells a property worth P12.5 million. ________
commercial and an additional rate of ___ shall be added to an established residential zones.
20. Treasurer of the LGU where the property is located: The transfer tax in the sale of real
estate properties is paid at the ________.
21. Ordinary asset: A bank's acquired asset which form part of its real estate inventories at the
close of its accounting period shall be classified as ________. 22. 1: The documentary stamp on
lease of real estate is P3.00 for the first P2,000.00 or fraction thereof and additional P___ for
every P1,000 in excess for first P2,000. 23. 20, 10: The documentary stamp on every mortgage
or pledge of real estate is P___ for the first P5,000.00 plus P___ for every P5,000 or fraction
thereof in excess of the first P5,000.
24. B: In case of sale of real property paid under deferred payment basis, the payment of the
documentary stamp tax shall accrue upon.
a. Notarization of transfer document
b. Execution of the Deed of Absolute Sale
c. Execution of Contract to Sell
d. Payment of the full amount
25. 1.5%: The creditable withholding tax in the sale of a real estate dealer of a household lot
priced at P220,000.00 is ___.
26. 3%: The withholding tax for a property sold by a real estate dealer worth, P1.5 Million is
___.
27. 30 days: To avail of exemption from capital gains in the sale of a family home, the seller is
required, among others, to notify the BIR through a prescribed form of his intention to avail the
exemption. The notice must be filed within ________ from the date of sale.
28. Within 5 days of next month: After a Deed of Absolute sale was made, signed and notarized
when should the Documentary Stamp tax on sale of real property be paid? ________
29. Ordinary asset: Property held by the owner as inventory or stock in trade of buy and sell
business or used in connection with trade, business or source of income is referred to as
________.
30. 30000: The capital gains tax due on sale of P2,000,000.00 property with P500,000.00 initial
payment is P________.
31. E: Capital gains tax on the sale of real estate classified as capital asset is a a. Creditable tax
on sale
b. Deductible item from income tax c. Prepaid income tax
d. Deduction from value added
e. Expanded withholding tax
32. Creditable withholding tax: If the property sold is an ordinary asset, what is the applicable
tax? ________
33. 50%: In case of false or fraudulent Estate, Donor, or Capital Gains Tax BIR form was willfully
made, how much surcharge based on the taxes or deficiency tax shall be imposed? ___
34. 6%: The sale of real property worth P1,500,000.00 considered as ordinary asset by a person
who is not habitually engaged in real estate business shall be subject to a creditable
withholding tax rate of ___.
35. 10 years: The exemption on payment of CGT on the sale of principal residence may be
availed of only once every ________.
36. 100%: Spouses A & B sold their principal residence and as their broker, you should advise
them that the transaction is exempt form Capital Gains tax if they spend ________ of the
proceeds of the sale in acquiring their new principal residence.
37. Certificate Authorizing Registration/ CAR: After paying the capital gains tax and
documentary stamps, a ________ is required from the BIR prior to transfer of the TCT.
38. 720000: The W/H tax of a broker becomes 15% when his accumulated income for the year
is already more than P________.
SET G
1. TAX BASE, NOT LATER THAN 30 DAYS AFTER NOTARIZATION, 25%: Capital Gains Tax of six
percent (6%) shall be based on ________ and shall be paid on _______________. Payment after
said period is subject to _______ percent penalty. 2. CAPITAL GAINS TAX: ________________ is
the tax imposed in lieu of the income tax on the profits presumed to have been realized in the
sale, exchange
or disposition of real property classified as a capital asset by an individual, estate or trust.
3. ZONAL: ______________ valuation is used by the BIR as the basis for computing the capital
gains tax or expanded withholding tax other than the actual selling price. 4. A: Which
information is false?
a. capital gains tax is 6% of the total contract price or zonal value whichever is higher
b. Documentary stamp tax is 1.5% of the total contract price or zonal value whichever is higher
c. Transfer fee is computed at 1.5% of the total contract price or zonal value whichever is higher
d. Pasig City and Quezon City imposes a Business Tax on sales of real estate titled to
corporations
5. CAPITAL ASSETS: Under Revenue Memorandum Circular No. 1-98, a corporation is now
subject to capital gains tax if it sold real estate property classified as
_________________________.
6. 18 MONTHS: Under RMO No. 1-98, an individual can now be exempted in paying capital
gains tax if the proceeds of the sale shall be fully utilized in acquiring or constructing a new
principal residence within _____ months.
7. TAX: An enforced proportionate contribution imposed upon a person, property or interest by
the legislature for a public purpose and generally payable in money is called __________.
8. DOCUMENTARY STAMP TAX: A tax affixed on documents, instruments and papers
evidencing the acceptance, assignment or sale of a right, property or obligation is called
_________________________.
least _____ taxable real estate transactions during the preceding year.
10. More than 25%: Sale of real property with _______ % down payment is considered as a
cash sale which requires full payment of the capital gains tax before the sale can be registered.
11. D: The sale and transfer of title from a real estate dealer to a buyer of a house and lot at
P4,000,000.00 is subject to the following EXCEPT :
A. credible withholding tax
B. transfer and registration fees
C. expanded value added tax
D. capital gains tax
E. documentary stamp
12. 5: Unless validated, tax credit life span is only for _____ years.
13. Final Witholding Tax: The tax in the sale of real property classified as capital asset is a
__________________ tax.
14. STATUTORY SELLER: In a foreclosure sale, the creditor bank is the _____________ and as
such is liable to pay the capital
gains tax based on the bid price.
15. TAXATION: __________________________ is the inherent power of the State acting
through the legislature, to impose and collect revenue for the purpose of supporting the
government and its recognized objectives.
16. PERCENTAGE TAX: The lease of house & lot with a rental of P100,000
per month, which is the sole income of the owner, shall be subjected to ___________________
tax.
17. 3%: The expanded W/H tax rate on the sale of house and lot package by a developer at the
price of two million pesos is ______?
18. TREASURER OF THE LGU WHERE PROPERTY IS LOCATED.: The
transfer tax in the sale of real estate properties is paid at the
_______________________________.
19. ORDINARY ASSET: A bank's acquired asset which form part of its real estate inventories at
the close of its accounting period shall be classified as ____________________ asset.
20. 1.00: The documentary stamp on lease of real estate is P3.00 for the first P2,000.00 or
fraction thereof and additional P___________ for every P1,000 in excess for first P2,000.
21. 20, 10: The documentary stamp on every mortgage or pledge of real estate is P______ for
the first P5.000.00 plus P____ for every P5.000.00 or fraction thereof in excess of the first
P5.000.00.
least _________ taxable real estate transactions during the preceding year.
23. B: In case of sale of real property paid under deferred payment basis, the payment of the
documentary stamp tax shall accrue upon
a. Notarization of transfer document b. Execution of the Deed of Absolute Sale
c. Execution of Contract to Sell d. Payment of the full amount
24. 1.5%: The creditable withholding tax in the sale of a real estate dealer of a household lot
priced at P220,000.00 is __________.
25. 3%: The withholding tax for a property sold by a real estate dealer worth, PI.5 Million is
_____________.
26. 30 DAYS: To avail of exemption from capital gains in the sale of a family home, the seller is
required, among others, to notify the BIR through a prescribed form of his intention to avail of
the exemption. The notice must be filed within _______ days from the date of sale.
27. WITHIN 5 DAYS OF THE NEXT MONTH: After a Deed of Absolute Sale was made, signed and
notarized when should the Documentary Stamp Tax on sale of real property be paid?
_________________________.
28. ORDINARY ASSET: Property held by the owner as inventory or stock in trade of buy and sell
business or used in connection with trade, business or source of income is referred to as
_______________ asset.
29. E: 32. Capital gains tax on the sale of real estate classified as capital asset is a a) Creditable
tax on the sale
b) Deductible item from income tax
c) Prepaid income tax
d) deduction from value added tax
e) Expanded withholding tax
30. CREDITABLE WITHHOLDING TAX: If the property sold is an ordinary asset, what is the
applicable tax? ___________________________.
31. 50%: In case a false or fraudulent Estate, Donor or Capital Gains Tax BIR form was willfully
made/ how much surcharge based on the taxes or deficiency tax shall be imposed?
_____________________.
32. 6%: The sale of a real property worth P1,500.000.00 considered as ordinary asset by a
person who is not habitually engaged in real estate business shall be subject to a creditable
withholding tax rate of ____________________.
33. 5: The exemption on payment of CGT on the sale of principal residence may be availed of
only once every _________ years.
34. 100%: Spouses A & B sold their principal residence and as their broker, you should advise
them that the transaction is exempt from Capital Gains Tax if they spend ______ percent of the
proceeds of the sale in acquiring their new principal residence.
35. CAR: After paying the capital gains tax and documentary stamps, a
____________________________ is required from the BIR prior to transfer of the TCT.
36. 720,000.00: The W/H tax of a broker becomes 15% when his accumulated income for the
year is already more than ______________.
commercial and an additional rate of _________ percent shall be added to an established
residential zonal value.
38. 1,000,000.00: The amount of family home equivalent to fair market value considered as
allowable deduction from the estate of a decedent
39. 6 months: The Estate Tax Return shall be filed with the BIR within
______________________.
40. 5%, 200,000: In payment of estate tax, an allowed deduction to the gross estate of a
decedent is funeral expense which is ______ % of gross estate or ____________ whichever is
lower.
41. 1,919,5000.00: Real estate brokers with an aggregate income of _________________ or
more within 12 month period are required to register as VAT taxpayers.
42. 500.00: The annual registration fee for a VAT-registered real estate broker is _________.
43. 1,919,500.00, NON-VAT, PERCENTAGE TAX: A real estate dealer / lessor whose annual
gross receipts do not exceed ______________________ shall be liable as a
___________________ taxpayer subject to _________ tax under Section 112 (now Section 116
of the Tax Reform Act of 1997) of the Internal Revenue Code. 44. MORE THAN P1,919,500.00,
P12,800.00: Lease of real property for residential use in the ordinary course of business is
subject to value added tax when the annual gross receipt is ______________________ and the
monthly rental per unit exceeds _____________________.
45. P3,199,200.00: Sale of a residential unit held primarily for sale to customers in the ordinary
course of business is subject to VAT when the selling price exceeds ______________________.
46. 12,800.00: Lease of residential units with a monthly rental per unit not exceeding
_____________ is exempt from VAT regardless of the aggregate rentals during the taxable year.
47. 15%: Based on net gifts, the maximum rate of donor's tax is
________________________________?
48. 5%, P200,000.00: In payment of estate tax, an allowed deduction to the gross estate of a
decedent is funeral expense which is ______ % of gross estate or ____________ whichever is
lower.
49. 1,000,000.00: The amount of family home equivalent to fair market val-
ue considered as allowable deduction from the estate of a decedent
_______________________.
50. 30%: When a donee of a parcel of land is a stranger, the donor's tax rate is
_________________%
51. 1,000,000.00: A standard deduction of _____________, in addition to deduction for family
home with fair market value not exceeding P1,000.000.00 is allowed as an additional deduction
from gross estate for estate tax purposes beginning January 1, 1998.
52. C: 2. The lease of house & lot with a rental of P100,000 per month, which is the sole income
of the owner, shall be subjected to:
a. Capital gains tax
b. Value added tax
c. Percentage tax
d. Creditable withholding tax
1. 10 years: Real property declared for the first time shall be assessed for taxes for the period
during which it would have been liable but in no case of more than__________ prior to the
date of initial assessment:
2. the assessor, 3 years: The sworn declaration of real property shall be filed with
____________ once every _____________.
3. From January 1 to June 30, commencing with the year 1992: Sworn declaration of property
filed during the period ___________________.
4. Within sixty (60) days after the acquisition of such property or upon completion or
occupancy of the improvement, whichever comes earlier: Acquisition of real property or
improvements on real property shall be filed a sworn statement declaring the true value of
subject property ________.
5. 30 days: Every person... who shall claim tax exemption for such property under this Title shall
file with the provincial, city or municipal assessor within _________ from the date of the
declaration of real property.
6. 2%: Failure to pay taxes at the end of the quarter following the date the notice of assessment
was received shall be subject to an interest rate of ____________.
7. 60 days: Any owner or person having legal interest in the property who is not satisfied with
the action of the provincial, city or municipal assessor in the assessment of his property may,
within __________ from the date of receipt of the written notice of assessment, appeal to the
Board of Assessment Appeals of the provincial or city 8. Chairman - Registrar of Deeds
Member - Provincial/City Prosecutor
Member - Provincial/City Engineer: Composition of the Local Board of Assess- ment Appeals
9. Of the assessed value:
1% - province
Not exceeding 2% - Metro Manila: Rate of basic real property tax
10. Agricultural Land
- if 1/2 of 1 hectare is uncultivated
- if 50 trees of perennial crops to a hectare are planted (exempt)
Lands other than agricultural
- more than 1/2 of 1000 sq.m. is unutilized or unimproved: Idle Lands Coverage 11. Inability to
improve, utilize or cultivate lands by reason of force majeure, civil disturbance, natural
calamity: Exemptions from additional idle land levy
12. 60% of the actual cost of projects and improvements including cost
of acquiring lands for public works projects.: Special levy shall not exceed _________.
13. Annual payments of not less than 5 years and not more than 10 years: Pay- ment of
special levy
14. 20%: If the basic real property tax and the additional tax accruing to the Special Education
Fund (SEF) are paid in advance in accordance with the prescribed schedule of payment, a
discount not exceeding ________ of the annual tax due may be granted.
15. 30 days: The protest in writing must be filed within _________ days from payment of the
tax to the provincial, city treasurer or municipal treasurer, in the case of a municipality within
Metropolitan Manila Area, who shall decide the protest within sixty (60) days from receipt.
16. 2 years, action from provincial/city treasurer required within 60 days from receipt: Tax
credit or refund may be claimed within _____________ from the date the taxpayer is entitled
to such reduction or adjustment.
17. 2% per month, not more than 36 months: Unpaid basic real property tax or any other tax
levied shall be subject to _____________ and shall in no case exceed ______________.
18. Local school boards: The proceeds from the additional one percent (1%) tax on real
property accruing to the Special Education Fund (SEF) shall be automatically released to the
______________
19. General fund of the province or city where the land is located: The proceeds of the
additional real property tax on idle lands shall accrue to the respective _____________.
20. general fund of the local government unit which financed such public works, projects or
other improvements: The proceeds of the special levy on lands benefited by public works,
projects and other improvements shall accrue to the _______________.
21. President of the Philippines: The ______________ may, when public interest so requires,
condone or reduce the real property tax and interest for any year in any province or city or a
municipality within the Metropolitan Manila Area.
SET I
1. Property taxes are an "_______________" tax -- according to value:
ad valorem
2. What does 'ad valorem' mean?:

according to value
3. We pay property taxes according to the __________ of our property.:

assessed value
4. In 1978, California voters passed this measure that sharply cut property taxes.
Proposition 13
5. Over time the assessed value has no correlation with the market value. Why?:
The market value increases over time.
6. Proposition 13 capped the increase of assessed value at _____% per year. No matter what
the value of the home does, if you're the owner you won't experience increases in property
taxes over ______% per year.: 2%
7. In CA, why is the increase in property taxes is capped at 2% per year due to Prop 13?: Over
the past 5 years, CA's property values have increased in some areas 50%. Most people would
not be able to afford our real estate if property taxes increased as fast as the property value
goes up.
8. Property taxes are based on the assessed value, which in CA has nothing to do with the
market value of the property based on Prop 13.
Explain.: You're driving down a street in LA where all the houses are worth $7 million. One guy
on one side of the street might be paying property taxes on his house like it is worth $7 million
because he just bought it. Another person on the other side of the street is paying property
taxes on it like it is only worth $1 million because they bought it so long ago.
9. Under Prop 13, the maximum tax rate statewide is a base rate of ________.- : 1%
10. Prop 13: The only reason you would discuss assessed value would be if you are discussing
________________, because it is no relation to the market value.: property taxes
11. Over time the gap between the assessed value and the ____________ value will increase
dramatically.: market value;
Market price might inflate 6% each year;
property taxes stay at 2%
12. ____________ of the home inflates over time;
____________ of the home stays the same.: market value;
property taxes
13. Prop 13:The maximum increase in our assessed value per year is ___% per year.: 2%
14. Prop 13: Reassessment events are actions that trigger an ____________ in the assessed
value.: Increase
15. Prop 13:There are 2 things that could trigger a reassessment:: 1) Qualifying sale (sale of
property)
2) Major Addition
16. Prop 13: Qualifying Sale explained: When you sell the property to someone else, that will
reset the property tax assessed value.
You bought your house back in the day for $600 and now it's worth $2mil, but your taxes are
still based on 600k (plus the little 2% increases). You sell it and I buy your house and now the
property taxes reset for $2mil house.
17. How would the government know if you've made a major addition?: - Through permits.
This will reassess property taxes and assessment value.
18. A ____________ and a _______________ can trigger a reassessment.: qualifying sale and
a major addition
19. Proposition 60: Homeowners at least 55 years old can transfer their low assessed value to
a new home within the same county (generally one-time).
20. Proposition 90: Homeowners at least 55 years old can transfer their low assessed value to
a new home in another county if it is allowed by the new county. 21. To take advantage of Prop
60 and Prop 90 you must be how old?: 55 years old
22. Which of the following is considered an ad valorem tax? (a)real property tax.
(b)unit tax.
(c)use tax.
(d)death tax.: a. real property tax
23. Annual property tax (formula): Annual property taxes = (assessed value) x (tax rate)
= $400,000 x 1.25%
= $5,000 per year
24. The ASSESSED VALUE is determined by the county _____________.: county assessor
25. The TAX RATE in your area is determined by the County Board of _______________.:
County Board of Supervisors
26. A _________________ must be filed with the Assessor within 45 days of transfer: Change
of Ownership Statement
27. Where do you file a Change of Ownership Statement with?: The County Recorder/Assessor
2 / 14
11. Real Estate Taxation

Study online at https://quizlet.com/_8f20xr
28. The county ____________ determines your assessed value. He wants to know if you sold
your property. A _________________ statement must be filed with the county Assessor
within _______ days of the transfer.: assessor; change in ownership statement;
45
29. Morgan Property Taxpayers' Bill of Rights: requires the county assessor
to allow inspection and copying of documents related to an assessed property, including an
auditor's work papers.
30. A taxpayer who disagrees with assessed value may __________ their assessed value with
the Assessment Appeals Board within the Assessor's office.: appeal
31. If a property owner believes that the assessed value on his or her property has been set
too high, the owner could file a request to seek a reduction from the
(a)County Board of Supervisors.
(b)Assessment Appeals Board.
(c)Tax Collector.
(d)State Board of Equalization.: b. Assessment Appeals Board
32. properties exempt from taxes: 1) Intangible property (stocks, promissory notes)
2) Personal property & household furnishings
3) Property owned by government
4) Churches, charitable, hospital purposes
5) property owned by nonprofits (private schools + colleges)
Also, some boats + agriculture
33. Homeowner's exemption: An amount of property value of owner-occupied residence
excluded from property taxation.
An owner-occupied residence, including a condominium or duplex unit, qualifies for a
homeowner's exemption of the first $7,000 of full cash value.
34. Veteran's exemption: California war veterans may receive a $4,000 exemption on the full
cash value of their homes.
35. How to compute the basic tax rate:
36. What is the pneumonic for Property Tax year?: No Darn Foolin Around 37. ***No Darn
Foolin Around: November 1
December 10
February 1
April 10
3 / 14
11. Real Estate Taxation

Study online at https://quizlet.com/_8f20xr
38. ***The first installment of property taxes are due on _______________, and delinquent
after _______________.: November 1;
December 10
39. ***The second installment of property taxes are due on _____________, and delinquent
after _________________.: February 1;
April 10
40. Shouldn't February be the first installment and November be the second installment
(according to the calendar year)?: NO. The tax year is different than the calendar year.
41. ***The tax fiscal year is from _________ - _________.: July 1 - June 30
42. The second property tax installment is due and delinquent on (a)February 1st; April 10th.
(b)November 1st; December 10th.
(c)December 31st; June 30th.
(d)March 1st; July 1st.: A.
You must know the fiscal tax year for the state exam.Memorization Aid: No, Darn, Foolin,
Around
November 1: First installment due
December 10, 5 PM: Delinquent date for 1st installment
February 1: Second installment due
April 10, 5 PM: Delinquent date for 2nd installment
43. The government gives you a _____ year redemption period for non-payment of property
taxes.: 5 years
44. Most loans allow a lender (bank) to call a loan due for non-payment of
________________.: property taxes;
a bank will be upset if you don't pay your property taxes.
45. You have a _____ year redemption period for not paying your property taxes.: 5 years
46. The purchaser (highest bidder) at a tax sale receives a _______ deed.: tax 47. Tax Lien: A
legal claim by a government entity to take an individual's property or income when their taxes
are not paid in full
48. Real property taxes become a lien on
(a)November 1st.
(b)February 1st.
(c)January 1st.
(d)July 1st.: C. january 1
49. Certification of redemption: issued by the county tax collector when all past due amounts
have been paid.
50. The redemption period for nonpayment of property taxes is ______ years.- : 5 years.
51. Mostly likely that 5 year period will never come because the __________ will invoke an
acceleration provision before that.: lender
52. _____________ is the lien date for property taxes.: January 1
53. Tax delinquent residential real property not redeemed by the owner during the five year
statutory redemption period is deeded to the
(a)city.
(b)county.
(c)state.
(d)school district.: C. state
54. Property Tax Postponement Law: allows a senior citizen (person aged 62 or older) to
postpone payment of taxes on a personal residence.
55. Recognizing that many older people on fixed incomes have trouble paying property taxes,
the Property Tax Postponement Law was passed to allow
(a) senior citizens to postpone payment of property taxes.
(b) blind or disabled people to postpone payment of property taxes.
(c) both (a) and (b) are correct.
(d) certain individuals to postpone property taxes on houseboats and floating homes.: C.
56. Special Assessments: a tax that can be imposed on real property for a specific local
purpose, such as street repair, sidewalks, etc. They are liens on property until paid.
57. Benefit assessment (local assessment): Amount owed by owners of property that is
enhanced by the construction or renovation of improvements. Examples: finishing of streets,
construction of sewers, public utilities.
58. How does a benefit assessment differ from a special assessment?: its tax base is only the
properties benefited.
59. ***Mello-Roos Community Facilities Act: Allows developers go to investors and borrow
money to fund the infrastructure in the area. The developer uses it
to create streets, sidewalks, sewers, etc. THEN the developer will make all those homeowners
in the area pay for the cost of the infrastructure through a Mello-Roos Bond.
60. Who's responsibility is it for installing streets, sidewalks, and infrastructure in an area?
a) the city
b) the county
c) the developer
d) the state: c. The developer
61. A developer can off load the cost of the infrastructure onto residence by floating a
___________.: Mello-roos bond
62. Would you have mello-roos in older or newer communities?: newer communities where
the infrastructure was recently built.
63. Which of the following can a property owner expect after sewer lines are installed in front
of his/her property?
(a) supplemental assessment
(b) general assessment
(c) special assessment
(d) All of the above: c.
64. ***Does a seller have to disclose the existence of Mello-Roos to the buyer?: Yes.
65. Documentary Transfer Tax: Tax that is paid to the county every time you transact real
estate within the county (transfer deed) and is affixed to the grant deed; varies from county to
county, city to city.
66. ***What is the documentary transfer tax rate?: .55 cents per $500 or fraction thereof and
is only charged on "new" money.
67. The documentary transfer tax is only charged on "______" money.: new money;
It does not include any loan being assumed.
68. Assumed ________ amounts are exempt from transfer tax.: loan
69. Documentary transfer tax example: The 1200 Via Loca house is sold for $687,575. An
existing first trust deed of $524,000 is assumed by the purchaser. What amount of
documentary transfer tax may be charged?: $687,575 - $524,000 = $163,575.00
$163,575 ÷ $500 = $327.15, rounded up to $328 $328 × $.55 = $180.40 transfer tax
The $524,000 is "old" money so it is taken out of the equation. The "new" money is $163,575.
"Fraction thereof" means round up.
70. Cities sometimes charge an additional transfer tax (so they can get more money). I this
charged on top of the county transfer tax?: Yes.
71. In computing transfer tax, the consideration paid for the property excludes (a) the down
payment.
(b) the deposit.
(c) any preexisting liens or encumbrances.
(d) any property taxes due.: c. any preexisting liens or encumbrances that were not removed
by the sale (such as an assumed loan).
72. The sale of real estate is not subject to _________ tax.: sales tax;
It is a TRANSFER tax.
73. A manufactured (mobile) home can be either personal property or real property. As
personal property, a manufactured home is subject to
(a) local property taxation.
(b) vehicle license fee status.
(c) special tax assessment status.
(d) supplemental tax status.: b) vehicle license fee status
Generally, if a home is lifted off its foundation for relocation, it has to be registered with the
HCD and is considered personal property. Once it is put back on its foundation it is considered
real property once again and needs to be recorded.
Manufactured (mobile) homes can be either personal property or real property. As personal
property, a manufactured home is subject to vehicle license fee status. Vehicle license fee
status means that title to the manufactured home is registered with the Department of Housing
and Community Development (HCD). If treated as real property, a manufactured home is
subject to local real property taxation.
74. Sales tax: A tax imposed by the government at the point of sale on retail goods and
services. It is collected by the retailer and passed on to the state.
75. The entity in California that collects and administers sales tax is called the
_______________.: State Board of Equalization
76. If you are buying a business (like a restaurant) and the business had witheld sales tax who
is liable?: The buyer.
77. The _________ is liable for the seller's back sales tax under successors liability.: buyer
78. Successor's liability: The buyer of a business is liable for the seller's back sales tax.
79. If you are buying a business and want reassurance there are no back sales tax, the buyer
will contact the State Board of Equalization. They would then give you something called a
__________________.: clearance receipt or tax clearance.
80. A _________________ shows that the seller is clear of back sales taxes.: - clearance
receipt.
81. Who do you get a tax clearance receipt from?: The Board of Equalization 82. The legal
theory that says the buyer of a business is liable for the seller's back tax.: Successors liability
83. Who does the buyer contact to make sure there is no back tax?: The Board of Equalization
84. What will the Board of Equalization give the buyer if everything is okay?: - clearance
receipt
85. The California sales tax is a(n)
(a) ad valorem tax.
(b) tax paid on real estate.
(c) tax paid on tangible personal property. (d) tax paid on all personal property.: c.
The California State Sales Tax is imposed upon retailers for the privilege of selling tangible
personal property at retail.
86. Gift: Voluntary transfer by an individual of any type of property for less than full
consideration
87. The maximum nontaxable amount that can be given as a gift to one donee, in one year, is
currently
(a) $14,000.
(b) $10,000.
(c) $5,000.
(d) $1,000.: a. $14,000
Anything over $14,000 will have a gift tax
88. Federal Income tax are said to be _________________.: progressive;
meaning the more you make the more you pay.
89. Federal Estate Tax: A tax imposed on the transfer of property at death. It must be filed with
the IRS within nine months of death, even if there is no tax due.
90. Which of the following is true regarding current federal estate tax law? (a) The American
Taxpayer Relief Act of 2012 established a federal estate tax exemption of $5 million per
person, indexed for inflation.
(b) The exemption was $5.25 million for 2013 and is $5.34 million for 2014.
(c) The exemption is reduced by any large gifts (those subject to gift tax) made during the
decedent's lifetime.
(d) All of the above: D.
The American Taxpayer Relief Act of 2012 established a federal estate tax exemption of $5
million per person, indexed for inflation. The estate is taxed at a 40% rate on any estate value
over that amount. The exemption was $5.25 million for 2013 and is $5.34 million for 2014. The
exemption is reduced by any large gifts (those subject to gift tax) made during the decedent's
lifetime.
91. Does the real estate licensee serve as a tax advisor?: NO. It is best to be familiar with with
taxes in real estate transactions, but you can not act as a tax advisor.
92. Tax consequences with respect to real estate should be known
(a) prior to acquisition.
(b) at time of sale.
(c)a t close of escrow.
(d) three months after taking possession.: a.
Virtually all important decisions affecting tax liability must be made before a transaction in
negotiated. At any other time, it may be too late.
93. Allowable deduction: A deduction is an expense that can be subtracted from an individual
or married couple's gross income in order to reduce the amount that is subject to income tax. It
is often referred to as an allowable deduction.
94. Adjusted gross income: the taxpayer's total income.
95. taxable income: Income that remains after allowed deductions from adjusted gross income.
96. Tax bracket: Tax rate applicable to a taxpayer's taxable income. Higher the taxable income,
higher the rate.
97. ordinary income: ordinary income are wages, tips, salaries, and commissions.
Ordinary income is income that does not qualify for capital gains treatment.
98. capital assets: all property except business inventory or other property held for sale in the
ordinary course of one's business. Capital assets include a personal residence, land held for
investment, stocks, bonds, and machinery and equipment used in business.
99. Depreciation: The decrease in the value of an asset when computing property value for tax
purposes. It can also be a loss in the appraised value due to physical deterioration. The latter
type of depreciation is curable when it can be remedied by repair or addition to the property,
and incurable when there is no economical remedy. 100. basis: the basis of property generally
is its cost when acquired.
101. capital gains income: income from the sale of a capital asset.
102. A way to spread the cost of acquiring property used in a trade or business over its useful
life that is a deduction from adjusted gross income describes (a)reconciliation.
(b)recuperation.
(c)depreciation.
(d)deferred maintenance.: c. depreciation
Depreciation is an expense deduction taken for an investment in depreciable property to allow
for the recovery of the cost of the investment.
103. Are tax rules different for your primary residence and property held for
investment/income?: Yes.
104. Capital gain explained:: I bought a house for $400,000, then sold it for $600,000. The
$200,000 gain is the capital gain.
105. If you want to sell your primary residence and you don't want to be taxed (Homeowner
tax exclusion), this is how it works.: 1. Are you single or married? single: $250,000 in tax gain is
tax free
married: $500,000 in tax gain is tax free
But you have to have lived in the property 2 years out of the last 5 years.
106. Penelope Pilot owns her home, for which she paid $372,000, and has occupied it as her
principal residence for seven years. If Penelope sells her home for $595,000, must she pay
any federal income tax on her profit?: No. Penelope's profit of $223,000 (which will be even
lower after it is reduced by expenses of sale, such as a real estate commission) is less than the
$250,000 profit she is allowed to receive free from federal income tax.
107. Property taxes and mortgage interest can be tax _______________ on your primary
residence (homeowner): deductions
108. ***Which of the following is a tax consideration for the homeowner?
(a) mortgage interest deductions
(b) tax credits
(c) capital gains exclusion
(d) All of the above: d.
109. An investor _____________ take advantage of the homeowner's exemption from
federal income taxation but receives other benefits of property ownership.: Cannot
110. What is one way an owner of investment real estate can take a write-off?- : Depreciation
111. As taxpayers, our goal is to make our income ___________ on our tax return. We try to
get as much as a deduction as we can each year on our taxes so our adjusted income is lower
which means we pay less taxes.: lower.
112. How depreciation works:: I own that property and it is an investment. Every day the sun
beats on it, the sun deteriorates the building a little bit. When it rains, the rain pelts the building
a little bit. I should be able to write-off the wear and tear on the building.
113. ***What are two things that are NOT subject to depreciation?: 1) Raw land 2) Owner
occupied properties
114. Residential investment property can be depreciated over ______ years.- : 27.5 years
115. Book depreciation doesn't follow the _________ value of the property.: - market value;
the investment property could be worth 5x the amount in 27.5 years, but we're going to make
believe that the value is dropping every year (depreciation).
116. An investor purchased an apartment building for $7,500,000. The land is valued at
$800,000 and the improvements are valued at $6,700,000. What is the amount of the yearly
depreciation deduction available to the investor?: The depreciation deduction is $243,636 per
year ($6,700,000 ÷ 27.5)
Subtracted out the land bc it is not depreciable. Divided the value of the building by its salvage
life (27.5 years).
117. Depreciation is a ____ shelter: tax
118. What is the straight line method?: A method of depreciation, also called the age-life
method, that is computed by dividing the adjusted basis of a property by the number of years
of estimated remaining useful life.
119. Real estate is depreciated using the ____________ method.: straight line method
120. An investor can take advantage of all of the following EXCEPT
(a) depreciation.
(b) deductions for expenses of operation.
(c) homeowner's exemption from federal income tax.
(d) deduction of rental property losses.: C.
121. Tax Deferred Exchange (1031) Example: You bought a building 20 years ago in LA for
$700,000 and the building is worth $5mil now.You have a big income tax bill. Under the 1031
rules, you could sell the building. And then within 6 months, buy another building and defer the
income taxes. Also called a 1031 like-kind exchange, meaning it must be an exchange of real
property for real property.
122. What does "like-kind" mean?: real property for other real property
123. Delayed Exchanges: Your investment property sold, you have 45 days until a new property
is identified, and you must purchase within 180 days.
124. Sellers in a 1031 exchange have _____ days to nominate exchange property and up to
_____ more days to close.: 45 days;
135 days.
125. The sale of a primary residence doesn't require the purchase of another to be exempt
from taxes (not an exchange).:
126. What is the difference between the 121 (residential property) and the 1031 (investment
property)?: 1031 is an exchange, deferring the taxes (transferring to another property or owing
later if you cash out)
121 is a tax free sale
127. If Johnson's intent is to accomplish a "tax free" exchange of his apartment building, he
should exchange for
(a) another apartment building.
(b) a personal residence.
(c) a second home.
(d) an owner-occupied, single-family residence.: a)
To be a tax-deferred exchange, as defined in Section 1031 of the Internal Revenue Code, the
properties exchanged must be of like kind in nature or character. Most real property can be
exchanged for other real property, such as an office building for vacant land. Property held for
personal use cannot be exchanged for investment property; for example, a personal residence
cannot be exchanged for a house that will be rented.
128. installment sale: sale in which seller receives purchase price over period of years.
Spreading out the reporting of income usually favors the taxpayer/seller, who may avoid a step
up to a higher tax bracket or who may not want to pay the required tax in the year of sale.
129. An installment sale represents a tax advantage because
(a) it reduces tax rates.
(b) it eliminates taxes all together.
(c) it is a tax exemption.
(d) it defers payment of capital gains.: d.
An installment sale allows the taxpayer to postpone the receipt and reporting of income to
future years when his or her other income may be lower. Thus, a taxpayer can avoid paying the
entire tax on the gain in the year of sale.
130. A buyer does not have to withhold a portion of the sales price from a seller when
(a) the property is residential.
(b) the seller refuses to pay the withholding.
(c) the sales price does not exceed $100,000.
(d) None of the above: c.
131. Taxes charged in direct relation to property value are
(a) illegal
(b) paid annually
(c) ad valorem taxes
(d) paid upon a sale only: c.
132. The purpose of the property tax assessed value is to
(a) establish the base value
(b) equalize property taxes
(c) create the transfer tax rate
(d) ensure all counties are equal: a.
133. The person responsible for determining assessed values is the (a) county tax collector
(b) county supervisor
(c) sheriff
(d) county assessor: d.
134. The first property tax installment of the tax year is due on (a)July 1
(b)November 1
(c)February 1
(d)April 1: b.
135. The second property tax installment is delinquent after (a)December 10
(b)February 1
(c)April 10
(d)May 16: c.
136. Real property taxes become a lien on
(a)November 1
(b)February 1
(c)January 1
(d)July 1: c.
137. In California, the inheritance and gift taxes have been (a)increased
(b)reduced
(c)combined
(d)abolished: d.
138. Unless an extension is given, a federal income tax return must be filed for the preceding
tax year by
(a)April 15
(b)May 15
(c)August 15
(d)October 15: a.
139. A personal residence and business equipment are considered (a)personal property
(b)capital assets
(c)real property
(d)intangible property: b.
140. A principal residence must be occupied for how long to take advantage of the maximum
exclusion of profit from taxable income?
(a)One year
(b)18 months
(c)Two years
(d)Five years: c.
14 / 14
It is the tax on real property due to any individual/entity who/which owns real property in
the Philippines as imposed by the Local Government Unit (LGU) where the property is
situated. The legal basis is Title II of the Local Government Code (LGC) of Republic Act No.
7160.
Real Property Tax
Where Shall the RPT be paid?
At the City or municipal treasurer's office
When to pay the RPT?
On or Before January 31 if Annual payment
Quarterly March 31, June 30, Sept 30, December 31
Discount in the payment of RPT?
If the basic RPT and the additional tax accruing to the Special Education Fund (SEF) are paid in
advance, the sanggunian concerned may grant a discount not exceeding twenty percent (20%)
of the annual tax due.
Penalty On Late Payments of RPT?
2% per month until fully paid. maximum number of months is 36
so the maximum interest rate is 72%
Is RPT a lien to the property?
Yes it is superior to any liens, if not paid it can be sold in public auction, but can be redeemed
withing a year from the date of sale
Computation for RPT
RPT = RPT Rate x Assessed Value
What are the RPT Rates?
Cities and Municipalities Within Metro Manila = 2%
Provinces = 1%
LGU has a power to Levy RPT?
Yes they can also fix RPT rates but not extend to province since it's provincial board will have
the power to decide.
Special Education Fund 1%
Annual 1%, in addition to basic RPT this is allocated to local school boards
Computation for Assessed Value
Assessed Value = Fair Market Value x Assessment Level
Assessment Level
it Shall be fixed through ordinances of Sangguniang Panlalawigan, Sangguniang Panglungsod,
Sangguniang Pambayan of municipalities within the Metro Manila.
Actual Use
refers to the purpose for which the property is principally or PREDOMINANTLY utilized by the
person in possession thereof.
What are the properties exempt from the payment of RPT?
1) Real property owned by the Republic of the Philippines;
2) Real property owned by religious, charitable, educational institutions which is actually,
directly and exclusively used for the said purpose;
3) Non-profit or religious cemeteries;
4) Machineries and equipment that are actually, directly and exclusively used by local water
district and government owned and controlled corporations engaged in water and electric
supply; and
5) Machineries and equipment used for pollution control and environmental protection.
A case where a 4 storey building, the 2nd to the 4th floor is occupied and actually used for
educational purposes while the 1st floor is used for full-time commercial operations. Will the
predominant use rule be applied and consider the whole building exempt?
No. The land and the building is not used actually, directly and exclusively for educational
purposes, the rule on split assessment will be applied.
Split assessment- meaning the 1st floor of the building will be classified and assessed separately
from the other floors of the building. The 1st as commercial- taxable and the 2nd to 4th floors-
exempt.
Maximum Assessment Level Rates for LAND
Timberland 20%
Residential 20%
Agricultural 40%
Commercial 50%
Industrial 50%
Mineral 50%
Special Classes of Real Property
All lands, buildings, and other improvements thereon actually, directly and exclusively used for
hospitals, cultural, or scientific purposes, and those owned and used by local water districts,
and government-owned or controlled corporations rendering essential public services in the
supply and distribution of water and/or generation and transmission of electric power.
Assessment Level for Special Classes of Real Property
Cultural 15%
Scientific 15%
Hospital 15%
Local Waster Districts 10%
GOCC water and electricity 10%
Ad Valorem Tax on Idle Lands
In addition to the basic RPT, the LGU's may collect a maximum idle land tax of 5% based on the
assessed value of the property.
What are Idle Lands?
1. Agricultural lands more than one (1) hectare in area, suitable for cultivation, dairying, inland
fishery, and other agricultural uses, ½ of which remain uncultivated or unimproved.
Exceptions:
i. Lands planted to permanent or perennial crops with at least 50
trees to a hectare; &
6|Page
ATTY. ROLANDO B. PAGTOLON-AN, REB, REA, REC
PCU College of Business & Accountancy
ii. Lands used for grazing purposes (Note: put goats or cows on your
property).
2. Lands Other than Agricultural, located in a city or municipality, more than 1,000 sqm. in area,
½ of which remain unutilized or unimproved
3. Residential lots in subdivisions, regardless of land area.
Capital Gains Tax
Capital Gains Tax (CGT) is a final tax on the gain from the sale of capital assets.
Capital Gains Tax vs. Income Tax
When there is a sale of real estate, automatically people think that they have to pay Capital
Gains Tax (CGT). This is not necessarily the case. Regular corporate income tax (RCIT) [for
corporations] and regular income tax [for individuals] apply to the sale of ordinary assets while
CGT applies to the sale of capital assets.
Thus, we first have to determine whether the asset being sold is a capital or an ordinary asset
so as to know the proper tax rate to be used and the BIR form to be used, among others.
Capital assets vs. Ordinary assets
the term 'capital assets' means property held by the taxpayer (whether or not connected with
his trade or business), but does not include:
• stock in trade of the taxpayer or other property of a kind which would properly be included in
the inventory of the taxpayer if on hand at the close of the taxable year, or
• property held by the taxpayer primarily for sale to customers in the ordinary course of his
trade or business, or
• property used in the trade or business, of a character which is subject to the allowance for
depreciation provided in Subsection (F) of Section 34;
• or real property used in trade or business of the taxpayer."
Note:
on real properties acquired by banks through foreclosure sales - the same are considered as
their ordinary assets but banks shall not be considered as habitually engaged in the real estate
business for purposes of determining the applicable rate of expanded withholding tax.
Immovable Property
(1) Land, buildings, roads and constructions of all kinds adhered to the soil;
(2) Trees, plants, and growing fruits, while they are attached to the land or form an integral part
of an immovable;
(3) Everything attached to an immovable in a fixed manner, in such a way that it cannot be
separated therefrom without breaking the material or deterioration of the object;
(4) Statues, reliefs, paintings or other objects for use or ornamentation, placed in buildings or
on lands by the owner of the immovable in such a manner that it reveals the intention to attach
them permanently to the tenements;
(5) Machinery, receptacles, instruments or implements intended by the owner of the tenement
for an industry or works which may be carried on in a building or on a piece of land, and which
tend directly to meet the needs of the said industry or works;
(6) Animal houses, pigeon-houses, beehives, fish ponds or breeding places of similar nature, in
case their owner has placed them or preserves them with the intention to have them
permanently attached to the land, and forming a permanent part of it; the animals in these
places are included;
(7) Fertilizer actually used on a piece of land;
(8) Mines, quarries, and slag dumps, while the matter thereof forms part of the bed, and waters
either running or stagnant;
(9) Docks and structures which, though floating, are intended by their nature and object to
remain at a fixed place on a river, lake, or coast;
(10) Contracts for public works, and servitudes and other real rights over immovable property."
Thus, it appears that it is not only the sale of land and buildings or houses which we should be
focusing on, but also the sale of the above.
In simple terms, if the property is not ordinarily held for sale (as inventory) or used in business
and subject to depreciation, then the property is a capital asset. Now, if a seller is engaged in
the real estate business, and the property is one he holds out for sale to the public, then the
property may be considered as an ordinary asset.
Conversely, if a seller is not engaged in the real estate business, and the property is not used in
business and subject to depreciation, the property may be considered as a capital asset, the
sale of which
What is the tax rate of CGT?
The tax rate of CGT is 6%.
What is the tax base of CGT?
The tax base of CGT is
1) gross selling price; or
2) fair market value (FMV) based on the assessor's value; or
3) zonal value as provided by the BIR, whichever is higher. Remember BSM!
1. Ladderized Education Act: RA 10647

2. Start Up Act: RA 11337
3. Governance of Basic Education Act: RA 9155
4. RESA law: RA 9646
5. Occupational and Safety Act: RA 11058
6. TRAIN law: RA 10963
7. CHED: RA 7722
8. Continuous Professional Development(CPD Act): RA 10912
9. PRC Modernization Act of 2000: RA 8981
10. Electronic Data Processing Specialist Eligibility: CSC RES 90-083 11. Barangay Micro
Business Enterprise: RA 9197
12. Foreign School Honor Eligibility: CSC RES 1302714
13. Executive Decree for Ladderize Education Law: EO 358
14. Tesda law: RA 7796
15. Veterans Preference Rating: EO 132/790
16. Scientific and Technology Specialist Eligibility: PD 997
17. Skills and Eligibility Category: CSC MC 11, series of 1996
18. Barangay Nutrition Scholar Eligibility: PD 1569
19. Philippine Export Development Act: RA 7844
20. Board/Bar Passer Eligibility: RA 1080
21. E- Commerce Act: RA 8792
22. Barangay Health Worker Eligibility: RA 7883
23. General Banking Law of The Philippines: RA 8791
24. Legal Basis of PRC: PD 223
25. Revised Corporation Code of the Philippines: RA 11232
26. Data Privacy Act: RA 10173
27. Philippines Innovation Act: RA 11293
28. Corporation Code of the Philippines: BP 68
29. Honorable Graduate Eligibility: PD 907
30. Enhance Basic Education: RA 10533
31. K to 12 Enhancing Basic Law: RA 10647
32. Co-Loading Act: RA 106888
33. Agri Agra Reform Credit Act: RA 1000-2009
34. Sanggunian Member Eligibility: RA 10156
35. Foreign Investment Act: RA 7042
36. Philippine National Qualification Framework: RA 10968/EO 83 , s2012 37. Ease of Doing
Business Act: RA 11032
38. increase of K to 12 to 12 Years: RA 10533
39. Free Patent Act: RA 10023
40. Clean Air Act: RA 8749
41. Rent Control Act: SB 6163
42. UDHA (Urban Development Housing Act): RA 7279 43. Disaster Risk Reduction: RA 10121
44. Balance Housing: RA 10884
45. CARP Amendment: RA 9700
46. Ecological Solid Waste Mgt. Act: RA 9003
47. Conversion Development Act: RA 7227
48. Zamboanga EEZ: RA 7903
49. Maceda Law ( Realty Installment Law): RA 6552 50. Home Guaranty Corporation (HGC): RA
8763
1. Property taxes are usually...: ad valorem taxes
2. Ad Valorem: A latin phrase meaning "according to value" that is used to descibe a ta charged
in relation to the value of the property taxed
3. REal property provides..: an easily measured source of wealth for the purpose of taxation
4. When was prop 13 passed?: 1978
5. Proposition 13: limits property tax rate and property value on which taxes may be based
6. Proposition 13 is now...: section 110.1 of the Revenue and Taxation code
7. The maximum annual tax on real property is set by...: the board of supervisors of each
county
8. The max annual tax can be no more than...: -1% of base year value, PLUS -additl amt to pay
for indebtedness that was already approved by voters prior to passage of Prop 13 (1/4-/4 of 1%
property value
-bonded indebtedness approved by voters after July 1, 1978
9. Base Value: full cash value (market value) of a propety as of Feb 28,1975 OR date of
subsequent reassessment event.
10. Assessed value: the property value to which the tax rate is applied
11. If there has been no change in property (additoin, remodeling, or other improvement) or
owernship since Feb 28, 1975 assessed value...: is base value as of that date
+
annual inflation factor of no more than 2%
12. If the property has been sold or has changed ownerhsip since Feb 28, 1975, assessed value
is...: full cash value as of teh date of sale or change of ownership (base value)
+
annual inflation factor of no more than 2% in subseqnet years
13. For new construction since February 28, 1957, assessed value is...: full cash value as of
completion of construction (base value)
+
inflation factor of no omre than 2% annualy in subsequent years
14. Do assessed values always go up?: No, (even w/ no change in ownership) 15. When does a
property's assessed value decrease?: (1) if property's market value falls below its assed value
(2) negative inflation ex. 2010 in CA
16. Reassessment event: sale or other transaction, such as addition of improvements, that
triggers a revaluation of property for tax purposes
property is sold or remodeled
17. When there is a reassessment event, the result may be...: a substantial increase in the
property tax base value
18. The terms "purchase" and "change of owernship" do NOT include...: -the transfer of real
property between spouses
-transfer of a principal residence and the first $1 million is assessed value of other real prperty
between parents and children
19. Why are the terms "purchase" and "chagne of ownership" now regulated?- : b/c sale
triggers reassessment event which could increase taxes
20. Prop 60 provides..: that homeowners older than 55 who buy or build anothe rresidence
within the same country can transfer the assessed value of the previous residence to the new
residence
21. Prop 90 provides..: homeowners 55+ may transfer assessed value to a new residence in
another ocuntry, IF ALLOWED BY THE NEW COUNTRY
22. An application for prop 60 or prop 90 must be submitted..: within 3 years of the prucahse
of the replacment property
23. Homeowners over age 55 may be able to transfer...: a low assessed value to a new home
24. Severly disabled homeowners can...: transfer their present assessed valuation to a
replacement home (like 55+ ppl)
25. Property improvement that enhance the usability of a home by a severly disabled person
are...: not subject to rssesment
26. When is addition of an active solar energy system exluded from determination of
assessed value?: from 1999-200 tax year --> 2008-2009 tax year
27. Who is the elected offical responsible for determining assesed values and preparing the
tax role?: county assessor
28. Change in ownership statement must be filed: with the county recorder or assessor within
45 days of the date the transfer is recorded/change in ownership 29. what does a county
assessor do?: -determines assed values
-prepares the tax roll
30. What is the penalty for failure to file a change in ownership statement with the county
recorder or assessor?: $100 or 10% of the tax computed on the new base property value
31. The penalty also applies if...: complete information is not supplied following a second
request
32. Morgan Property Taxpayers' Bill of Rights:
33. General rule for taxes..: is that all real property and tangible personal property (except
business inventory) is taxable
34. Property that is EXEMPT from taxation inclludes...: -intanginble property (sotcks and
promissory noteS)
-personal property and household furnishings of indvidiuals
-property owned by a govt (
-prperty used exclusivly for religous, charitable, or hospital purposes,
-property owned by nonprofit organizations (private schools and colleges)
35. homeowner's exemption: owner0occupied residence (includig condo or duplex) quailities
for homeowner's exemption of first $7,000 of full cahs value
36. Homeowner's exemption rules: -residence must be occupied by the lien date (Jan 1)
-form w/ county tax assessor must be completed and filed by 5pm on Feb 15 to recieve
exemption
37. If the owners occupancy ceases...: county tax assessor must be notified (b/c no homeowner
exemption)
or
an assessment plus 25+ penalty will be made
38. Qualified CA war vereants are entitled to...: a $4,000 veterans exemption on property not
already subject to the homeowner's exemption
39. rules for veterans tax exemption...:
40. Qualified desable veterans are entitled to...: principal residence entited to exemption amt
of
$119,285 OR
$178,929 if annual income <$54,842
41. An unremarried surviving spouse of a qualified disabled veteran is entiteld to...: principal
residence entited to exemption amt of
$119,285 OR
$178,929 if annual income <$54,842
42. Two qualified disable veterans who share a residence can each qualify for...: disabled
exemption amt to the extent of each person's property interest
43. Property Tax Year deates: July 1 - June 30
44. Property tax is payable in...: 2 installments:
November 1st
February 1st
45. When is property tax delinquent?: November 1st --> 5pm Dec 10 Febuary 1st --> 5pm April
10
(if dates fall on weekend or legal holiday = 5pm next business day)
46. What is added to delinquent installments?: 10% penalty (on taxes for entire year)
47. What happens after second deliquent installment?: $10 fee charged for adding property to
the delinquent roll
48. What happens on Jan 1st?: Next fiscal year's taxes become a lien on the property
49. If a reassessment event takes place between Jan 1-May 31: There are two "supplemental
assessments" to adjust for an increase in tax liability
50. If a reassessment event takes place between June 1 - Dec 31: there is on "supplemental
assessment'
51. A notice of supplemental assessment may be appealed within..: 60 days of issuane of the
notice
52. On Jan 1, when the assessment roll takes effect for the next tax year...: a lien is placed on
all assess read property in the amt of the tax due
53. Supplemental assessment: additional "catch up" property tax assessment following a sale
or other reassessment event
54. When:
55. Rela property can also..: serve as security for personal property taxes?
56. What lien takes prioerty over all others?: Property tax lien
57. Exceptions when property tax lien takes priority over all others: -holders of a secuiryt
interest or mechanic's lien
-someone who bought the property or took title w/o knowledge of the lien -judgement len
creditor who acquired a right,title, or interest pror to the recording of the property tax lien
58. What happens on June 8?: Delinquint tax list is published in a local newspaper of general
cirulation
59. Unpaid taxes are subject to...: delinquiency penaliities
60. certificate of redemption: tax collector issues when all past due amts have been paid
61. When can resential property be sold?: if it is not redeemed (taxes paid) by its owner within
5 years
If property is damaged by a disaster - 5 yr period runs from the date of the damage 62. AFter
applicable 5 year period...: tax collector has 2 years to sell the property 63. The former owner's
right to redeem the property is in effect until..: the close of busines on the last business day
before a slae occurs
64. What is the redemption period for a nonresidential commerical property?- : 3 years
unless a couty elects to apply a 5 year period
65. Tax collector can sell unredeemed property to...: a taxing agency
revenue district
certain nonprofit organizaitons
66. A nonprofit organization that purcahses residental property must...: reha- bilityate the
property and sell it to low-income persons
67. Tax collector can selll the property to the highest bidder at: public auction 68. Who
approves the minimum bid of an unreedemed property being sold by tax collector?: The
County Board of Supervisors
69. The sales price at auction (of unredeemed property) must equal..: at least 50% of
property's fiar market value as determiend by county assesor w/in 1 yr to auction date
70. The high bid must be paid...: in cash or negotiable paper (tax collector decides) 71. The
purchaser at a tax sale receives a...: tax deed
72. Renters pay property taxes when..: they pay rent
...income tax credit may be applicable
73. special assessment: can be imposed on real property for a specific local purpose, such as
street construciton or repair
74. Special assessments require...: approval of 2/3 of voters
75. Assessments are proposed by..: a local governing body or by an improvement district
created by a city.coutny, as proovided by state law
76. A special assessment for a specific project can be..: made in one tax period or spread out
over a number of years
77. Improvement districts may secure financing by..: issuing bonds that are repaid by
assessments
78. Benefit assessment
...is also known as: local assessment
levy basedon other than assessed value
special benefit assessment
-special assessment
79. special assessment: appropriateion in the form of a tax on property that is enhance by the
addition or renovation of improvements, such as a light0rail train
benefut assessments:
Mello-Roos Community Facilities Act:
Documentary transfer tax: city or county can impose a documentary transfer
tax on all transfers of real property located in the jurisdiction
83. Notice of payment of the documentary tranfer tax appears..: on the face of the deed
transferring title
OR
seperate paper filed with the deed
84. If a COUNTY has adopted a transfer tax,: A CITY within the county pay adopt a similar
ordinace
85. Transfer tax rate: $0.55 per $500 paid for the property
It does NOT include any loan being assumed
86. The declaraton of the amt of trasfer tax due must state...: whether the property value was
or was NOT exclusive of the value of any remaining lien or encubance
87. Cities sometimes impose..: documentary transfer tax in excess of min charged by couties
88. Culver city tax: $4.50 / $1000
89. Los Angeles: $4.50 / $1000
90. Pomona: $2.20 / $1000
91. REdondo Beach: $2.20 / $1000
92. Santa Monica: $3.00 / $1000
93. Manufactured (mobile) homes can be...: either personal property or real proeprty
94. As personal proeprty, a manufacture dhome is subject to ...: vehicle license fee status.
--> meaning, title to manufactured home is registered w/ Department of Housing and
Community Development
95. If a manufactured home is treated as real property...: the manufactured hom is sbubject to
local real property taxation
96. When does a manufactured home qualify as real property under the Health and Saftey
code?: IF..
-a building permit is obtained
-the home is attached to a foundation
-certficate of occupancy obtained
-doc stating the home is attached to a foundation is recorderd
97. When a manufactued home qualifies ars real property..: it is treated as fixture or an
imporvement to the real estate
&
HCD cancels its title registration
&
title is registered w/ county recorder
98. Conditions for removal of a manufactured home from foundation: -owners must give
written consent, supplied to HCD
-local assessor must be notified in 30 days in advance
-transportation permit is issued by HCD
99. After a manufactured home is removed from its foundation...: it becomes personal
property until it again qualifies as rela property
100. Where can someone find info cnoncering sales tax and use tax?: Available from the local
office of the State Board of Equalization
101. What is the minimum sales tax charged in CA: 7.5%
102. Sales tax is divided between..: the state, county, and local taxing authorities 103. In
addition to the min sales tax rate, individual counties can...: add charges to cover
transportaiton or water discrict costs
Ex. san fran = 8.75%
LA = 9%
104. State sales tax is owed..: by retailers of tangible personal property regardless of whether
the tax was paid by a customer
105. Sales of food are...: NOT taxed
106. Buildings removed & sales tax: Buildings removed from land by a SELLER = subject to sales
tax
Buildings removed by buyer as part of a transaction = NOT subject to sales tax 107. When a
business is sold, what is subject to sales tax?: Fixtures are subject to sales tax
Inventory is NOT subject to sales tax
108. Use tax: charged to purchaser for storage, use, or other consumtopn of certain preronal
property
109. The purchaser is not liable for the use tax if...: the tax was paid to a retailer who has a
SELLER's PERMIT to collect it
110. If a business requiring a seller's permit is sold..: the buyer may be liable for tax owed by
the seller
111. The sale of any business that requires a seller's permit should include...: - provision for an
amt to be held in escrow until the State Board of Equilation provides a 'tax clearance'
112. gift: voluntary tranfer by an indiviudla of any tiype of property for less than full
consideration
113. no tax retrun need be made on a gift to one donee, in one year, of a present interest
valued at $14,000 or less.:
114. Payments made on behalf of someone else as tuition to an educaiton al org or to a
person who provides medical care are...: NOT considered gifts, no matter what the amt
115. When must federal gift tax regurs be filed?: by april 15 of the year following the fit
116. Even though a return must be filed, there may be...: a credit or an exemption available to
reduce or eliminate any tax liability
117. Transfers between spouses are...: not taxed
118. Is there a limit on the amt of property taht can be left ot a spouse?: NO

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SET A

3. Sworn declaration of property filed during the period ___________________.

4. Acquisition of real property or improvements on real property shall be filed a sworn

8. Composition of the Local Board of Assessment Appeals

9. Rate of basic real property tax

10. Idle Lands Coverage

11. Exemptions from additional idle land levy

12. Special levy shall not exceed _________.

13. Payment of special levy

1. National Internal Revenue Code of 1997

23. (A) Examination of Return and Determination of Tax Due.

36.the following powers of the Commissioner shall not be delegated

46. The following are hereby constituted agents of the Commissioner:

48. Section 13. Authority of a Revenue Officer. –

57. Section 18. Reports of Violation of Laws.

59. Section 19. Contents of Commissioner's Annual Report

61. - Submission of Pertinent Information to Congress

62. Report to Oversight Committee

66. means an individual, a trust, estate or corporation

70. when applied to a corporation, means a corporation which is not domestic

79. means any person subject to tax imposed by this Title

85. includes the performance of the functions of a public office.

87. means a merchant of stocks or securities, whether an in- dividual, partnership or

97. shall not include performance of services by the taxpayer as an employee

105. Not over PhP250,000

106. Over PhP250,000 but not over PhP400,000

107. Over PhP400,000 but not over PhP800,000

108. Over PhP800,000 but not over PhP2,000,000

109. Over PhP2,000,000 but not over PhP8,000,000

110. Over PhP8,000,000

123. Tax on Resident Foreign Corporations

124. Minimum Corporate Income Tax on Resident Foreign Corporations.

126. Tax on Branch Profits Remittances

2. assets that are used in trade or business. Subject to depreciation.

3. real properties acquired by BANKS through FORECLOSURE sales are considered as

4: engaged in the business of buying and selling or exchanging real properties.

6. engaged in the business of leasing or renting real estate properties.

8. sale of capital asset is subject to.

15. basis for tax computation.

16. fair market value as determined by the Commissioner (BIR)

17. rate of capital gains tax for real property

26. delinquency or failure to pay CGT.

29. is an advance income tax.

30. refers to selling price exclusive of interest

31. Rent income payments subject to creditable withholding tax.

32. income payments to certain brokers or agents P720k and below.

40. penalty for non-payment of withholding is ______ of amount due

44. DST on SALE

57. registration and annual fee for VAT tax payer

62. sale value of residential LOT that is VAT exempt

75. a standard equivalent to _________.

94. BIR Form ____ Withholding Tax Remittance Return 1606

A. It may impose ad valorem property taxes and capital gain tax.

A. may not levy real estate taxes.

A. construct and manage a park district.

A. the jurisdiction's annual budget times the tax rate.

A. adjust millage rates within the district to ensure fairness.

A. appeal to adjust the millage rate.

A. to exempt qualified property owners from ad valorem taxation.