Practice question
A taxpayer argues that every cash expense is automatically deductible and that every amount called a credit automatically produces a cash refund. Evaluate both claims.
Legal references
- NIRC Section 31, as amended by RA 10963 Section 8; https://lawphil.net/statutes/repacts/ra2017/ra_10963_2017.html
- NIRC Section 34(C), distinction between deduction and credit for qualifying foreign taxes; https://lawphil.net/statutes/repacts/ra1997/ra_8424_1997.html
Answer this question in flashcards to review your response and continue practicing.