In 2020, Bongbong Jr

Accounting Jan 23, 2021

In 2020, Bongbong Jr. created two (2) trusts for his minor son, Chiz. During the year, the two trusts earned net income as follows: Trust 1: P4,000,000 Trust 2: P6,000,000 How much is the income tax due of Trust l? a. P1,244,000 b. Nil c. P1,263,440 d. PI,266,000 The correct answer is: P 244,000

Expert Solution

The correct answer is a. P1,244,000

The income tax rate in philippines for self-employed or trust is P490,000 + 37% of the excess over P2,000,000 which is required to be deposited by filling BIR form No. 1701

Income tax payable = P490,000 + 37% of P2,000,000 = P1,244,000

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