1. For an employee receiving a monthly salary of P21,000 with annual mandatory deductions of P15,166, their annual gross income would be P252,000. Mandatory deductions and the 13th month pay are excluded from gross income. 2. For a public school teacher receiving a monthly salary of P26,494 with annual mandatory deductions of P34,185, their annual gross income would be P317,928. 3. For a resident alien couple with two children, the total annual gross income of the husband and wife would be P820,000. Several items such as taxes withheld, 13th month pay, interest, dividends, capital gains and housing benefits are excluded from gross

1. 1. A call centeragentreceivingamonthlysalaryof P21,000 withmandatoryannual deductionsof
P15,166, whichincludesSSS,PhilHealth,andPag-Ibigcontributions.Whatwill be the amountforhis
annual grossincome?IncludedinGrossincome:Salaryforthe year(P21,000 x 12) P 252,000 GROSS
INCOME (INCLUDED) P 252,000 ExcludedinGrossIncome:13th monthpay (P21,000x12/12) (lessthan
P90,000) P 21,000 Mandatory annual deductions(mandatoryannual deductionsare onlyconsideredin
the computationof nettaxable income,notgrossincome) P15,166 TOTAL EXCLUDED P 36,166 2. A
public-schoolteacherreceivingamonthlysalaryof P26,494 withmandatoryannual deductionsof
P34,185, whichincludesSSS,PhilHealth,andPag-Ibigcontributions.Whatwill betheamountforhisannual
gross income?IncludedinGrossincome:Salaryforthe year (P26,494 x 12) P 317,928 GROSSINCOME
(INCLUDED) P 317,928 ExcludedinGrossIncome:13th monthpay (P26,494x12/12) (lessthanP 90,000)
P 26,494 Mandatory annual deductions(mandatoryannual deductionsare onlyconsideredinthe
computationof nettaxable income,notgrossincome) P34,185 TOTAL EXCLUDED P 60,679 3. A resident
aliencouple withtwo(2) dependentchildren.The husbandreceivesanannual salaryof P652,000, living
allowancesof P100,000, anda housingbenefitof P300,000 (100%). Hiswife receivesP68,000 fromher
teachingprofession.The husbandreceivesthe following:grossdividendincome frominvestmentin
sharesof stock of a domesticcorporation,P10,000; interestfromapesobank account,P20,000; capital
gainon sale of shares,P5,000; and taxeswithheldbythe employerof the husbandatP118,000 andby
the employerof the wife.Howmuchwill be the total grossannual income of the husbandandwife?
IncludedinGrossIncome:HUSBANDWIFE SalaryP 652,000 SalaryP 68,000 LivingAllowancesP100,000
GROSS INCOMEP 752,000 P 68,000 TOTAL ANNUALGROSS INCOMEOF HUSBAND ANDWIFE = P
820,000 ExcludedinGrossIncome:Tax Withheld(neednottobe consideredforthiscomputation) P
118,000 13th month pay(husband) (P652,000/12) P 54,333.33 13th monthpay (wife) (P68,000/12) P
5,666.67 These followingitemsare notincludedbecause theyare subjecttofinal tax:Interestfroma
pesobankaccount P 20,000 DividendIncome fromDomesticCorp.P10,000 Capital gainon sale of
sharesP 5,000 HousingbenefitP300,000 TOTAL EXCLUDED P513,000