Chapter 5 Exclusion- items or receipts not included in the determination of the taxable income Non-taxable compensation income- earnings

that are compensation in nature but law specifically exclude as part of the gross income Non-taxable other receipts- amounts or values received other than compensation that are not taxable De minimis- privileges of relatively small value given by the employer to his employees Tax-exempt contributions- mandatory GSIS, SSS, Philheath, PAG-IBIG contributions and union dues Employers benefit rule- convenience or advantage of the employer when it is required by the nature of work Gift- any property legally and validly transferred form one person to another for free Bequest- personal property transferred from one person to another by will Devise- real property transferred from one person to another by will Barangay Micro Business Enterprise (BMBE)- any business entity engaged in production, processing or manufacturing of products whose total assets shall not be more than P3M Cooperative- duly registered association of persons with common bond of interest, who have voluntarily joined together to achieve a lawful common social or economic end Chapter 6 Fringe benefits- any good or service or other benefit furnished or granted by an employer in cash or in kind, in addition to basic salaries Fringe benefit tax- monetary burden imposed by the sovereignty on any good, service or other benefit granted by an employer to an individual employee Grossed-up monetary value (GMV)- dividing the monetary value of fringe benefits by 68% Rank-in-file employee- employee who is holding neither managerial nor supervisory position Managerial employee- vested with powers to lay down and execute management policies Supervisory employee- effectively recommend such managerial actions if the exercise of authority is not merely routinely in nature but requires the use of independent judgment Taxable amount- grossed-up monetary value of the fringe benefit granted or furnished Liability of the employer- to withhold the corresponding income tax from the fringe benefit earned by the employee