ABC Company started its business operations on November 2, 2021. The following were the transactions during the month:          Nov. 2, 2021 The owner made a cash investment to the business amounting to ₱2,000,000.         Nov. 5, 2021 Obtained a ₱500,000 loan and issues a promissory note to Citibank.         Nov. 8, 2021 Acquired land costing ₱1,000,000 on cash basis.         Nov.16, 2021 Rendered services worth ₱1,200,000 on account.         Nov.30, 2021 Paid salaries of the workers amounting to  ₱280,000

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Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.