Ben Company purchased an investment property on January 1, 2020 at a cost of P250.000. The property had a useful life of 20 years and at December 31, 2022, had a fair value of P280.000. On January 1, 2023, the property was sold for net proceeds of P290,000. Ben uses the cost model to account for investment property. What is the gain or loss to be recognized in profit or loss for the year ended December 31,2023 regarding the disposal of the property, according to IAS 40 Investment Property?     A. P77,500 gain B. P67,500 gain . C. P30,000gain D. PI 0,000 gain

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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.