28. Peter inherited from his parents a large parcel of land of underdeveloped land acquired by them years ago with a total cost of P2,500,000. Pedro now sells all of these parcels for P25,000,000

How much of the gains should Peter report in his income tax return for the year?

b. P22, 500,000 because although the properties are capital assets and te transactions is subject to capital gain tax, such tax is still considered income tax. Thus, the gain shall also be reported in Peters income tax return.

a. None, because the properties are capital assets and the transaction is subject to capital gain tax and not basic tax.

d. Any of the choices above.

c. Peter has the option to report an income of P22,500,000 subject to basic tax or exclude the income from his income tax return and pay 6% capital gain tax

29. Suppose that when Peter inherited these parcel of land, they were already developed real estate subdivisions with small lots being sold on instalment basis. He sold the property for P25,000,000. How much of the gains should Peter in his income tax return for the year?

Group of answer choices

a. None, because the properties are capital assets and the transaction is subject to capital gain tax and not basic tax.

c. Peter has the option to report an income of P22,500,000 subject to basic tax or exclude the income from his income tax return and pay 6% capital gain tax

d. Any of the choices above.

b. P22, 500,000 because the properties are classified as ordinary assets. Thus, the gain shall also be reported in Peters income tax return.