Problem 1

During the taxable year, Red Horse Company provided cash fringe benefits to its employees in the total amount of P3,200,000. The following additional data are provided:

1. 80% of the total amount given was provided to managers and supervisors as follows:

a. 50% classified as resident citizen

b. 50% classified as non-resident alien not engaged in business in the Philippines

2. 20% of the total amount was given to rank-and-file employees

Required: Compute fringe benefits tax

Problem II

Peter Pan, a self-employed individual, had provided the following fringe benefits during the taxable year:

a. Housing units provided to the Plant Supervisor necessary to the business operation of the employer:

Fair market value 900,000

Zonal value 1,000,000

b. Housing unit to be used by the VP

FV 1,200,000

ZV 1,000,000

c. Cash payment for the purchase of grocery items 382,500

d. Car benefits in the name of the finance officer acquired on installment basis:

Cash price 750,000

Installment price

Down payment 400,000

Annual installment for four years at the amount of 400,000

Required: Compute the fringe benefit tax