PART 3 DONOR’S TAX — Notes ‘Don 1's tax is a tax levied, assessed, collected and paid upon the trans! by any ea cdeucrumaaaert of the property by gift. : | Transfers subject to tax. ~ The tax shall apply whether the transfer is in trust z Sane oe gift is direct or indirect and whether the Property is Teal or personal, tangible or intangible, : 2. Nature. ~ The transfer includes not only the transfer of Ownership in the oad nee but also the transfer of arly Hight or interest in property, but less le. : 3. Purpose of gift tax: To compensate for loss of ifteome tax when |. Formalities of a donation : » Hiotable zrapery, ~ The’ dinaiish indy Wo inad’ oral 6 Joi However, if the value of th ‘ay be made orally or in. writing. donation and the aceeptanee sea Property donated exceeds Ps,000, he ‘arge estates are split’by donation. donation shall be void. © made. in writing. Otherwise, the 2. Immovable property, ~ To be valid, j ° i Specifying therein valtg, it must be made:in a public dociiment, mee must. es) donated and the value of the charges which Retnisites ofa valid donation (CID) : 2 Capacity of the donor at the +, . to donate in onset ae of the donation 3. Delivery, whether Sees 4 Acceptance of the it by the anaes ctivepONOR'S TAXATION = Notes _ 151 ee a aca ions made by spouses el Sonation made by husband and wife out of conjugal or community 4 funds: Each is donor to the extent of 1/2 of the donation. A ifonly one spouse signed the deed of donation, ~ donor's tax purposes, without prejudice to the question the validity of the:donation. actions from gross gift nen on the property assumed by the donee. 5 2. Amount specifically ‘provided by the donor as dimintition ‘on the property donated. Exemptions from gross gift under the code " 1. Gifts made to or for the use of the National Government, agencies and instrumentalities which is not-conducted for profit, or to any political subdivision. i es 2 Gifts in favor cf non-profit educational; charitable, religious, cultural or social welfare institution, accredited hongovernment organization, philanthropic organization or research ifistitution: Provided, however, that not more than 30% of said gifts shall be used by such ‘donee for administtation purposes: 3. P250,000 of net gift annually ~ there is only one donor for tight of the other. spouse to Exeuptions under special laws. ~ Donations to the following are exempt under special laws: 1. Rural Farm School |“ J es 2 People’s Television Network, Incorporated i People’s Survival fund d : ; Aurora Pacific Economic Zone and Freeport Authority Girl Scouts ofthe Philippines z Philippine Red Cross ‘Tubbataha Reefs Natural Park National Commission for Culture and the Arts Philippine Normal University University of the Philippines National Water Quality Management Fund Philippine Investors Commission Ramon Magsaysay. Award Foundation Philippine-American Cultural Foundation International Rice Research Institute . Task Force on Human Settlements National Social Action Council FEER FS ep ey oysey am ~ SeAEN wy: Ps 152 — southeast Asian Fisheries Dey velop ment of the ‘Mt Center Jopment ‘Academy Ol a Deed Rar of the philippines ritance e Renunciation of inhe! a i co-heir is : wor of a not a donation x ees iy -co-hei ation of inheritance if the enunciation 1S made in favor of fort : Noth ee Arent to Ut of taxation. Eat) = fern not a co-heir, there IS a donation. and awards to athletes. - They are ‘ ~ Pt ftom 1 Given to competitions; 2, Held in the Philippines: or abroad; and. : c 3, Sanctioned by their respective national sports associations. _ BAYANIHAN TO HEAL AS ONE ACT (RA 11469) Donations to the government. of the following are exempt fro1 given for the sole and exclusive pu ‘ 1m donor's tax, when period of the state of national eg of combatting COVID 19 during the 1 Cash donations; : 2. Donations of all critical ' 4, unsaid above or needed: healthcare: equipment or supplies as ane such as, but not limited to, food “ i 4. ee of propery what ek pec cane lots/buildings). -” whether real ot personal (shuttle service, use of Donations above . following doness “Ci #0 be exempt fromm donoi’s ta a. Private hospital lonor’s tax ‘when given to the religi 8 and/o) : ee: cultural or Aj now-stock non-profit educati i crnett Organization welfare corporatinn eon and/or charitable " zation and/or reg, (even if non. ue institution, foundation, 10° - Local private earch institution ern rest OF philanthroott Organizati corporat OF organization; and exclusive insti ning a Civic orpanizati aa Partner ay Gstrbute angio ed ener and/or internation! pationa goreratitoistiay transfer said pel (a) actually, ae ‘) Ncted for pnt OF any enti chi d donations/gifts to, a4)" si "Ba or ey created ee aoareited NOP oat litical ed of its agencies which ision of the said Governme™Pee eee eee “VO nok> > emption shall be subject to timel i The ry rogirements imely submission of ee fers for insufficient consideration ™ excess of fair market value over the selling price shall be subject donor apps to all kinds of property except resl property- capital to > reehe transfer is revocable, in contemplation of death, or u ae of appointment: eee of the market value of the pronerty at the eae 7 over the selling price (consideration) shall be subject to estate tax aoe not git ta ace : Necessary 4 change, or other transfer of property made in the ondinary a sales OF ansaction which is bona fide, at arm's length, oad Fae oa ee ative jntent) will be considered as made for an adequate and mt consideration jn money or money's worth). Motives that preclude the -category-of a transfer in.contemplation of : “od eyed 1 Tosee the children enjoy thé property ‘while the donor is alive; 2. To save on income taxes. 3. Tosave property taxes. i j 4. Tomake dependents financially independent. - . 5. Tosee thé family catty on the basiness inthe family name. 6. To settle family disputes. Mean +, To relieve the taxpayer ofthe burden of management. Rate of Tax - : 6% computed on the basis of total gifts im excess of P250,000 exempt gift made during the calendar year.” Administrative Provisions i : Rae ak ae days from date of it . Date of payment — at the time the return is : ee 3. Place of filing - Authorized Agent Bank (AAB), RDO, Collection see doly authorized Treasurer of the City oF Municipality ‘where the donot ws Office of the om there is “residence in the Pailippiness with a issioner fa 0 egal re cippine Embassy of ‘Consulate in the country ¢heis domiciled at the time of the transfer oe ulate shall be paid thereat Ret ims filed with the Philippine Embassy OF consPART 3 DONOR’S TAX (Multiple Choice Questions) ) A. CONCEPT OF DONATION & DONOR’s Tay COMPUTATION OF GROSS GIFT 1 An act of liberality whereby one. disposes. gratuitously of a thing.or right in favor of another who accepts it — Tepe oe : A. succession J ~ C. "donation cacao D. tradition Mec 2. A tax imposed on the gratuitous ‘tray of property al nt nsfer of between 0,0 Persons who are living at the time the transfer eee A Estate tax . B. Donors tax Ri eel OQ psNA eH ~ eek . pjatncions between donor's tax and estate tax, ean 155 "period for payment of tax CS Gey a attachments to the tax retum, D., Tare transfer a D : cft tax is imposed on ‘the transfer of none 4. Mis why thas been sustained as a (any rn oo A excise tax C. donee’s tax B. property tax : D. poll tax oA ‘ 5, A donation made by a stockholder to a conporation is subject to donor because of the following principles, except: | na 2 co A entity theory C. _ benefit received principle B. lifeblood theory D. taxbenefitrule i o 6. What is the tax.implication if a corporation condones the cot of a stockholder because of a goad thing done by the latter to the corporation? A B The condonation is'based om the ‘liberality of the corporation, therefore, itis subject to donor's tax. ; rae The condonation is subject to ‘donor's tax on the ed de is based on its liberality. Moreover, it is equi ea ee dividend to the stockholder which is, therefore, $4 ne oot i ae re, it is an income itis tantamount to a declaration of vie Ti However, itis which i : ‘vider t aie ich is subject to 10% divid a ee ‘ to Not suibject to donor's tax on the corporation’. 5 "itis just a simple case of extinguisrrr dor not subiert Neither subject to income tax on tax on the corporation.156 —— c was given a prize of P50,009 o pare” peso prize subject to donor's tax? Bd | = pads wont (0 Bers poo” guest te fF mM sort 10° peind its 1 tax? : Yes A yes yes crs No fe! A No No a ann given is for business motive and not for donation purpose, Se Peat pased on the liberality of the donor. 8, The following are the requisites of 2 donation for purposes of the donors ta, except (RPCPA) : A. capacity of the donor’ B. capacity of the donee - C. delivery of the subject matter of gift D. donative intent m8 The aw requires that the & Siesta i eevee ra Ss must be capacitated to donate. Donets bilateral act, the obligation ieee, because although donation is 4 ae obligation is imposed only on the donor. 2 ns to conceived : : : accepted by perso or unborn children i if s ns: wh ren could be validly done ready bon 0: would legally ‘represent them if theyg D owing is a valid donation 0 one A gonation of.a cellular phone worth P4,500. A o y donation of a passenger jeepney worth P150,000. B. A arcel yand worth. 500,000 in a private document. pare’ worth 500,000 in a private document. foll A arposes of a donation, the following rules apply. Otherwise, the For pumpesSpvaid. Ifthe property donate is: =a 3 Movable property. ~ The donation maybe made orally or in writing. However, if the value of the personal ‘property. ‘exceeds P5,000, the donation and the acceptance shall be made in writing. 2 Immovable property. — It must be made in a public instrument. 14, Which of the following constitutes a table gift? A. Creditors gratuitous discharge of a-debtor’s obligation. B One-day rent-free use of another's property. C. Agratuitous transfer by an incompetent. D. An agreement to make a future transfer which is not supported by 2 consideration. Ma 2 Antonio donated shares of stocks of Clayetano Corporation to Barandila Aarl 20, 2019 with a right to ravoke it, The donor delivered the property Apt 6, 2019. On June 20, 2019 Antonio relinquished the Fight.10 revoke. Ten days after, the donor died. F val For purposes of donor's tax, the gross gift should be pased on the Ue Of the shares on a a A Apri 2 9 1 20, 2019 c. June 20. 201 8. Apnl25, 2019 D, June 30, 2019 Qe15S cane pecember 31, 2017 donat : ote a setter 10 Lemont OF ved py the latter on January 78 & | 43 Warren wr The letter a fetter of acceptance was receiveg ¢ 201g ors tax was not paid unt wn, by Y 23, | 14. 15, rth P3500 Who accepted the 3018 The don january was 7onsummated on Warren on Y zoos geal ¢, January 7, 2018 a December 31. 2017 D.° May 22, 2019 B vanuary 15, 2018 m 8 d to her sister. Martha P20 t 18, 2018 Elizabeth joane' 0,000 eat 142% per annum payable one (1) year thereafter. One fe before the debt becomes ue, Martha’s husband died. Conseq, nth sister that she js condoning the loan inciy ing e informed her a Elizabeth informe’ ‘he donation made. by Elaatont® interest. How much iS the value .of Martha? ‘A. P:200,000 c. P222,000 B -224,000 esr Di None Mea y gg c : ‘ Z ie : * s. WS Eee oe «12% i ele 000 x 12% X 11/12. ae Amount condoned : aan ue Which of the following examples is not taxable (RPCPA)? ~A..A Filipino citi ipino citizen donated a parcel of land located in the United States B ea earrseete eel . On June ; BLO of rie A made-@ gift of P500,000 to hi C. Mr. Ramos, a Ree May 1 2018: is daughter on i Ml r ve i 200000 asa bithday gi VEE wife @ diamond rng wort D. Aand Bare’ the o i i favor of B. nly heirs of C. A renolunces his share of inheritance @ op AS a general Tule, donati tons between husband and wife are widrete at tt ee on occasion of family rejoicing. A gi P300, ionaire is still moderate Eee fi a y, of the family. eae i ae unciation of aco-heir is not a donation for the i A reas ‘on is that the effects of the renunciation pe i ; ment of death of the decedent. Therefore, the renounced share 01 % thee to the other heirs. a mu by omic status Law applies on the following donations, except qhe TRAIN F Donation made on December 30, 2017, accepted by the donee following day and the acceptance was made eeu to the stad ‘anuary 3, 2018. B. ation of property on December 30, 2017, accepted by the donee on the following. day and the acceptance was made known to the donor on January 3, 2018., Actual delivery was made on January 5, 2018. c. Donation made on‘ December 30, 2017, accepted by the donee on the following day and the acceptance was made known to the donor on the same day. Donation made on December 31, 2017, accepted by the donee on the following day. and the acceptance was known to the donor on same day. me ae: The law in force at the time of the completion of the donation shall govern the imposition of donor's tax. i : A ‘The donor’s tax shall not apply unless and until there is a.completed gift. ‘The transfer of property by gift is perfected from the moment the-donor knows of the acceptance by the donee; it is completed by the delivery, either actually or constructively, of the donated property to the donee. 17. Which of the following changes is not introduced in. donors taxation by the TRAIN Law? : é A. Provides extensi ing of tax retum. i 8. Removes nee ee Te owries or gifts made on account of ¢ marriage. eae . b Simplifcation of the tax rate. . Elimination of distinction on tax rate donee. between relative and strangerpAREY y a i : a (60 ne oes to donor's tax? subject following | 4 Ni Cristo: : 16, cho re os Rica Research Inst, A Dont ser vives 1 cal candidate which WAS SPent during yy mn Cash contrib nder services is CD eerpelcn perio were the abtor oi not rel 8 In favor 1D. Remission « ‘ the creditor. @o a paren nich is done by spreading the gift oyg 19. A tax minimization Sey of iower tax liability - ; f numerous calendar yeal a or Spread. « €.Donation of fife insurance sl SE ‘5s. Void-donation. hos wa sB 20. The spouses Helena and Federico wanted to.donate a parcel of fand to ther son Dondon who is getting married in December 2018. The parcel of land has a zonal valuation of P420,000. What is the most efficient mode of donating the property? (BEQ) ‘ 4 A. The spouses should first donate if 2018 @ porti Portion of the propery gong, 200000 then spread.the.P400,000 equally for 2018, and 8. Donate the property in its entirety Cc. Th : 8 entirety in 2018, te popery ino #1 €20h donate @-P110,000 portion of the value of D. The spouses shou, 2" C8 should donate P100,000 in 2049. in 2018 bea donate a P160,000 portion of the vale ot 7020, Helsna should donate tha era each in 2049. Then, Qsox ie MENU N ea eeud: 4; When the donee is exempt from in = idual is also tax-exempt, income tax, the donation 1 Seepya eae Grea 2 proceeds of: life insurance policy ‘on the life of the f the ‘beneficiary is irrevocable is aaaet eee gyate™’, qesignation gtatement2. ., Statement 1. Statement 2 giatementt Ise : Fal Cc. False False True Bava Fs Tras BL Tras True a> ig : qhe determination of whether a donation is exempt or not does not nee because: the taxability or non-taxability of a depend on the do! donation should be based on the: provision of law. There are exempt individuals ‘which are subject to donor's pa dona ‘an example is a donation to’a minimum wage earner. If his income during the taxable year does not exceed the minimum wage rate, he is exempt from the payment ‘of income tax. However, @ donation given to him may still be subject to donor's tax. Ina donation of a life insurance, the basis:of the donation is not the proceeds of the policy but the payment of premiums by the insured to - theinsurer. ~~” aig? BRT ae) 2 Statement 1: The agreement bet én the donor and. the donee that the hitter shall assume the tax burden js inding on the governm! Statement 2: There is nO donor's tax.in. 4 donatian on account of mara the mariage did not actually take place. Only the first statement is wrong. Only the second statement is wrong. Both statements are wrong. Both statements are s ge if po@> Qc ae s : i year old BOY, worth alge 2 : June 23, 2020, Freddie Boy: a mental executed a deed donating to his brotmes raidy 2 098qa nsER DN TAATION-Atgg \ arines Sur which was also donates rao, 0am ae year 20° The donation Is Freddie 8° does not own the property consider cause Fred ey is father is void. 99 that to ‘the donor is minor and mentally defecty, ‘ a, void, because Fe orcaable- Valid, although Un ge the donor 6 can 7 Valid, although voidable ie : donate property: m > 24. Which of the foll A. Those made between perso! concubinage at the time ‘ofthe. donation. * B. Those made to conceived andunbom children: C. Those made to a public officer by reason of his office, D. Those made between husband and wife during their marriage ‘owing donations is subject to, donor's tax? ns -who were: guilty of adultery ‘The following donations shall be voids 1. Those made between pe , aa 2 cohinge thin cite donation Era ere > inade between 5 ca 3 wei in ene heen found guilty of the same criminal I made toa: pubiie care g asi Dublic’ officer is wi cendants, by reason of his office ed ee ee and Donations made by those to conceived i bom fargo Would Tegal eabom children may be accent 2) v. Tepresent them if they were alrea ay 25. Antiogui: loquia donatag Within two (2) ye & 1,000 eu : storay an years from ‘duare meter tana: : a ion share the date to Botor with a condition tha Nditioy i Pe atallbe suerte Tanoation, Botor will const 3 There shat be STound for the r the donee to comply with the Ocation of the donation: ©8S€ of no ors -fulflmey tax on th nt © donati : ate donation" even if it may be revere"ons TAX Multiple Choice Questi case of revocation of the donation, —— 163 1. yemment may Be refunded tothe a{On. tHe donors tax paid to te whieh of the above statements is correct? rement 1 only C. Statem - “ atement 2 on ' Both statements D. Neither statem: a @ “A w which of the following statements is false? The gross gift of a non-resident alien ‘A will include all intangible personal properties regaral : wil. include alt intangible personal ca momraeesctlcafon. B. Philippines. : with reciprocity will not include all intan; properties regardless of location. : ey ae p. without reciprocity will not include all intangible personal propert situated outside the Philippines. ete a c @ A - : . As a rule, there is no reciprocity on-nonresident aliens. If they are subject to reciprocity, intangible personal properties (whether within or without) are not included in the gross gift. . Which of the. following is not considered as intangible personal property within? a Franchise which must be exercised in the ee . Shares of stocks issued bya domestic corporation. js C. Obligations or bonds issued by @ foreign corporsion wih business situs in the Philippines.” ' ines D. Shares of stocks Issued by a foreign corporate” 51% of the busine of which is located in the Philippines. i) 4 i ible personal Tn order that ehianes of stock shal Be emBsiceeS Fe ning OE Property within, at least 85% of the ee corporation is located in the Philippine"AXATION ~PA REVIEWER IN TAXATION ~ 4p, 164 ___CPABE ts: Given te flowing stator” ¥ shares of stock issueq ete nonresident alien of by i a 1A donation BY 8 Pert to donor's tax if such shai 3 a . b noratstus in the PRilippines res, = 8 : rm t alien of shares of stock of a foreig: A donation by @ Sees tax if at least 85% of the Dusinegs? on | Of sug, cn is located in the Philippines. nonresident alien of bonds issued by a fo) a = dg " : Sere tax if 90% of the business of such forej an coy Oration, is situated in thé Philippines. pore tion A donation by a nonresident citizen of a franchise will be f f i ‘ if donor's tax in the Philippines even if such intangible is being Ts af the Philippines, 3 lutside Which of the above statements is/are correct? A Statements 1 and II! C. Statements Iii and tv B. Statements land IV; =~ Dp: Statements and iv Mc Nonresident citizens and resident ali ce donated properties Tegardléss of location are subject to donors tax onwok p. Be Pre Eee ees oromeor/ Og COMPUTATION of DONOR’S TAX DUE and PAYABLE of the following can claim P10,000 exemption on gifts given on account 8 marriage? A Resident citizen C. Resident alien B Nonresident citizen D. None. a D 49, One of the following exemptions cannot be’claimed by a nonresident alien donor: ’ ‘A. P10,000 dowries or gifts given on account of miarriage of a legitimate ‘son. - B, Donation to the Philippine government, its agencies or instrumentalities or political subdivisions thereof. ©. Donation to a non-profit educational institution not more than 30% of the giftis used for administration purposes. D. P250,000 per year. : Moa 41. Given the following statements: Statement |: Statement It: Statement it A donation by husband and wife jointly of @ conjugal property will require a separate computations of cones tax which will be contained in two separate donor's tax . “ff the property donated is 2 se seed ae 8 donor and wil not be required donor's tax return. : roperty of the if the property donated. community ae of hishher spouses, each of them is con ‘shalt be liable for share in the co-owne p ‘donation. whatever tax that may accrue on suchvos: petween SPOUSES duting the nation intor Vi ye, 9 * sage voidabe 460 — statere™t wv A mi answer choos? the be: e vemos! ond 4870 re p. 8 Sirements * a8 ments 1,2 4nd 3 are true C. state! tatementS 2 and 3 are true gratuitous advantage, direct or indi shall be void, except se c 5 f Brery donation or grant 0 i petween spout oy tbe otter ‘on the occasi gifs which the spouses may BP sion of any family rejoicing: . 42, Justina made the following donations of cash to his son ol susie on octoner 2012 as follows: eyes account ‘of sanary 6 Pogo ; 10, 2019 = i July 15, 2019 = Eo =<; 100,000 September 10, 2019+" ‘The tax due on Septembe’ < i s Pm r 10, ae is- 5 i " 4,500 - D. Exempt mec Net gift Add: Prior net sits mars 00,000 19 : ree 7 P75,000 [aaet ets - «50,000 Taxable Patt + 50.000 Rate of --375.000 re Taxdue _ 275,000 Whi * ich ofthe fo 25,000 lowing —-6% donati ations re 4500 Sult to g Net gift of P80,000?"6 TE dan donated property to Balbakwa with a market a ‘000. The property is subject to a mortgage aces e 60,000 which was paid by the donor at the time of the donation. fra requested Busina to pay ‘Altura’s liability with Cabangis in the ‘amount of P100,000 and in retum, the personal property of Altura 180,000 will be donated to Busina. . the daughter of Ananias wes married to her boyfriend. As a i Cc _ ananias donated cash worth P100,000 to his daughter. cu >? pert 80,000 was donated by Bibong to Barangay maaliwalas for use as site of the Barangay Hall. a B su: The following does not result to a gross gift ; ‘A. ‘Donation to the Development ‘Academy. of thé Philippines. Donation of a parcelof: land to: brother, the donation is in-a private 8. document. : ¢. Donation of a real property to the City:of Manila D, Donation of property the ‘encumbrance therein was assumed by the donee. et . . m8 35. Exempted from donor’s taxation are gifts made (BEQ) A. forthe use of the barangay. : B._ in consideration of marriage. ct toa school which is a stock corporation. . to a for-profit govemment corporation. Moa %. Ag All of the following, éxcept one, 4. Donation aoe to the Philippine Red Cross. pean Donation to.the Hevelopment iacademy of tHe Phitippines- - exempt from donor's tax. which is it?TAXATION — , - ee | iven to the victims of the eruption of Mo ly giv Unt Bly, i jose. San, C. Donation a City of Davao for public purpy " D. Donation to gc the donation must be given To be exempt from ‘ation (2) educational,..(b) chartm © the a Gi social welfare, (f) accredited non., overnme, religious (2) ctor, (c) socal wt ant sede organization, (g) philanthropi Z men institution. ; i a oo nae ions directly to private individuals, | — DT att by charitable impulses give rise to no exem, tio ea -profit school always had cash flow Problems, rebut 37. SARE era administrative personnel to . =a the school. In 2019, Don Leon donated P100..mitlion 2 ae — provided the money: shall be used solely.for. paying the walaios aad benefits of administrative personnel. The donatio eS, and In represents less than 10% of Don Leon's taxable income for the year: Is-he. ‘Subject-to. donor's taxes? (BEQ) Foe ae ish A. No, since the donation is actually, directly, and exclusively used for educational purposes. 8. Yes, because the donation is to be wholly used for administration Purposes, : C. Yes, since he did not Obtain the requisite NGO Certification before he a ta the donation: 2 for 2019," donation dogs not exceed 10% of his taxable income id the donated property A ; Property e Nessa ln Intangibies wit weSident alien !™Movable "Without D. Resident aignt®" Intangible ee q Within or without Kind of property Withing@ A rg 39 10 44 are based on the following information: es donated the following properties in Los Angeles, California, USA Lats and building in Jolo, Suly d in the State of Califomla, U.S.A. Car registeree ni weilies 0 ihe Philippines — ghares of stock in a corporation based in U.S.A. Accounts receivable, debtor Is in the Philippines ipannie is & resident citizen, the gross gift is ES a, P-780,000 os ©) 245,000 B 295,000 88. 220,000 m * aes Land, California. a 250,000 > Land and building, Sulu. 175,000 Car, California 225,000 Jewelries, Philippines 45,000 Shares of stocks, USA 60,000 25,000 ‘Accounts receivable, Philippines Gross gift : ~ - 70,000 40. The gross gift of Annie if she A. P-780,000, 2" Gp 245,000 B. 295,000 p. 220,000 ge a Se a er Sle nee a a Jewelries, Philippines ats Accounts receivable, Philippines 25,000 Gross gift : 345008 Eee eee eee fe ee P250,000 175,000 225,000 45,000 60,000 25,000 isa nonresident alien without reciprocity is ~i lien with reciprer:, 41 The gross gift if Annie is a nonresident alien with Feciproci ae AP 780,000 C. P 245,000 B 295,000 D. 220,000 m oO ia P 175,000 Land and building, Sulu email Philippines: Gross gift 22 Sa 42. Donor A made the following donations to B, donee: / i P500,000 Fair market value of land, with : an unpai £200,000, 60% of which shall be assumed pratt MOMgage " 600,000 Car, with an agreement th: a at the tax of P36, Shall be assumed by B. +000 on the nation ‘The net gift on the donation is — A P 4,100,000 C.. P934.000 8. 1,000,000 D, “884609 Qs : For aumposes of the donor's tax, “net gift” shal Mean the net econoiti mortgaged prone ccrues to the donee, Accordingly, if 2 the obligation Be Ty is tra a8 a gift, but imposing upon the donee y ing om the tortBage liability, then the net gift is measured Mortgage assumed, i" ™arket value of the Property the amount of 43. Butch m, lade i P A Successive conten children in 2019. in which of the follow Pay donors tax? , To Aima on ; 15~ Sccount of marriage, P80,000. May 1579, nae S°Count of graduation, 280,000. Nall of the above donations Ofher 18" birthday, P150,000.71 35 Es 80, tal net gifts 000 ose: Exempt gift e000 7 axable 000 Rate of tax 60,000, Tax due . 6% “a which of the following statements ia fale? ‘A. Donor's tax applies also to juridical persor B. Donations to second cousins are ‘Subject 10 20% dt ¢. Encumbrance on the property donated, if assum lOnor’s tax rate, deductible for donor's tax purposes, fed by the donor is not D. As a rule, @ donation between Hust i ao lusband and wife during the marriage am 8 48. Which of the following Is not a factor in thé determination of taxable gifts? A. _.\dentification of transfers included in gross gift. B. Application of exempt transfers. C. Subtraction of allowed deductions. 5. Muttiplying net gift by the applicable tax rate. tax. A net gift mp subject to donor's aaa ports Taxable: gift refers to properties multiplied by the applicable tax rates results to donor's tax taxable gift. 48. Given the following statements: oper) gent donation: in fe.on the pre: the current yea. Ss : tax payabl ! tatement 1: ereaes ore made during sate prior net orfts uring jl) just be Sta ti er to add the FTN age donations wil tement 2: It is not propt axes paid on ee cause . Sad from the donors tax com ;47. donor's tax is relative} Joes «ey 13: The tax rate for Y lower Statement Lee eacisiataet than the Choose the best answer: . Statements 1 and 2 are false. B Statements 1, 2 and 3 are false. , C. Statements 2 and 3 are correct, D_ Statement 2 is false. m8 ieee : Sayers, who is sin gle, Gave. an outright gift of P50 who needed the m Of P to a fier loney to pay medical expenses a friend, Johnson, The donation is not taxable because the gift is Outright, The donor's tax payable is P30,000, . The donors taxis P15,000. The donation is deductible from the GOSS income of Sayers, Qc oOm> Gross gift P500,000 i Less: Exempt pitt noes cceett : Taxable tet “250.000... Rate of tax e000) Tax due . —— 8% 5.000 N 2018, Nea mated nae mon Nae 2 to her Sister-in-law: Sonia who was geting A oor taximalcation on Neate aor cura the calendar year. What's dep 00 port ; ven BA promatln of Meiage’” donation ig exempt since giver " A putas Of the donation is exempt being a donation pore + Celia shat) : D Pay 830% do The P25 99 Portion of ee ee on the entire donation. ation 1S exempt. Q »yon was made ofany. proper weyordoma, Miss Angut, a fot with @ bungal ; his ee ungalow thereon. The- woot the property. 18 'P2:200,000. Thé donation provides that it nay be * oKed anytime at the pleasure of Maguiang. wis Tower shop woith. F700,000 to Hardy Nevo, his gardener. The ion is provided in his will “ cash of 500,000 each to the three fhousemaids. How much is the donor's tax due on the above donations? a P-720,000 c. P.450,000 100,000 : Dp. 75,000 m ° Gross gift (500,000 X 3) P1,500,000 Less: Exempt gift 51 250,000°.° Taxable 4,250,000 Rate of tax “ ap Taxdue 3 75,000 The donation to.Ric Lees js void. To be valid, the donation must be. reduced in writing. . le transfer. ‘The donation of the bungalow to Miss ‘Angut is a revocabl Therefore, the donation is subject estate tax. ; ; The donation of the flower shop to Hardinero is a mortis causa donation. Itis subject to estate tax. 50. Relativo fore oe Gomporation. The donor J 500,000 to Heredero i Pg tax of the outstanding capital stock of the Icnge-corporation- The dono due on the donation is - : A P 15,000 -¢.7 P30,000 8 D. None 90,000 QaVU a 1 500,000 Grossgift 250,000 Tess: Exempt sit 250,000 Taxable Rate of tax 76,000 Tax due . ied to his childh cala's 600. piscocho, was married Ded st. hen ee ja gave as weed Ot residential Rouse worth poeta ‘a brand new Sport Utility Vehicle (SUV) to Catalan 00,09 e donation, the car was mortgag With to his son. and 7 700,000. At the time of th which was assumed by Celalang: The nares With Metrobank for P800,000 assun payable by Alcala on the above donations is - NOS tay A P93,200 C. P 189,000 6. 92,600 D. 204,000 me fo house P2,500,000 Gross gift : oan Less: Mortgage 200,000, less Mortge assumed Calslang _ 800,000 Less: Exempt gi 3,400,000. Taxable oe 250,000 Rate oftax 3,150,000 Tax due 189,000 Questions 52 and 53 re Dased ‘ are based'on the following information: pa raganti, single, donated th ea @ following properties on September 21 Value pre P 100,000 Sani _ Donee \ fe Dimalupi 1,500,000 dewelries ‘alupig, brother, o1 1 irlfrie ; On A 20,000 fe 8 ot Treny, gitiend seated lla 75, ‘arents, si 200.000 Ca ‘ PICPA . liver wedding anniversary gift 50, a Oy. Matini tooge Cash Ugang, ee use as sita of barangay he! onal Ra ation is revocable 7099 C28h inter: Om Wetorce Matatag nat Rice Research institute Nico, Pea father of his mothe! ' donation is embodied in theNOE BecEEESeeeE Eee ernest are gros giftis : “7s 8 000 p 2,045: ' C. _P4,920,000 A © 9'415,000 D. — 2280'000 a A qo Dimalupig P 190,000 Tey : 200,000 Parents 1,500,000 PICA i sie 20,000 Bey. Matini A opal Rice Research Institute : oe Mataleg, 100,000 Gross gift 2,045,000 Revocable donations and. those that are embodied i 7 subject to estate tax. Se ee 53, The donors tax due is - A P122,400 ‘ C.. P-166,000 B. 100,200. - Ja Be ons 45,200 ms Gross gift P2,045,000 Less: Exemptions Berney) Matinios 75,000 50,000 - Net a 3,920,000 Less: Exempt gift 250.000 Taxable 1,670,007 Rate of tax : —S% Tax due 190,200 information: Number 54 to 56 are based on the following ® Spouses Santos gave the following donations: April 16,2018 - Te Toe eee oi et Moss ‘oe aoe | Lala, daughter. _ ae don January 15,2019 -- Moperty worth Pa Bis- ae ste santos on APH 16. 2018 i tax due on c. P 15,000 “Tr a 000 D. Exempt A P3 8 15.000 mA Net gift (600,008 x¥) jece Exempt gi 50.000 Taxable Rate of (ax : Tax due P. 300,000 The donor's tax payable by Mrs. Santos on November 2, 201g ne . C. Exempt 2 A P3,000 & Poo D. P 12,000 @ Net gift (400,000 x ¥2) ? P 200,000 + Add: Net gift, April 16 (600,000 x ¥2) eae Total net gifts eee ee gift - axable Rate of tax me Tax due taxa 15,000 eae ax a April 16 3,000 56.7 a - oo Payable by Mr. ae On January 15, 2019 is - a Ao Cc. P1,000 “D. None = B Netzit (000, Less: Rye, 000 X42): Teena a P500,000 pate of tay : . we 250,000'§ TAX — Multiple Cho; Ns e cumulative ‘System of compys 177 Jonations made in the sare year 8 the donors tay 2s on Only on ert 67 and BB Wr. and Mrs. Abafo gave the folowing nmunity properly was donated to Balae, si value of the property.is P650,000, 'ster Of Mi. Abatio. The fir mariot To Abante, legitimate son on account of marr 2, : worth P150,000. : 9°, exclusive property of Me. Abate onations on July 4, 2020 57. The donor's tax due on Mr. Abajo A. P 12,900 c. P9000 8B 13,500 : D. 8,400 mB To Balae (650,000/2) Abante Gross gift Less: Exempt gift Taxable Rate of tax P Tax due at Y5 Ps ‘ jc ation of 58. The tax payable on Mrs. Abafio assuming there was.a previous don 160,000 in 2019 A. P13,500 1 Ger, P1250 B. 49,600 ee Mo P.325,000 To Balae a Less: Exempt gift 75:00 Taxable sh Rate of tax : =8500 Tax duepa RE ION ~ 1S ie gee n the following information: mbers 59 to 62 are pased O ‘ Ne ad the following conjugal transfers uring mr and Mrs oped hi ind to their son, On accour ne 2020 ,arcel of lat January 31 Donated 3 "34, 2020. The fair market value oer Marg, The son's wedding IS : 33980,000. The fair market value at the time, lan time of 0 3 thy the donation Was i time ot fr) The donated property was subject to P100,000 mone! "an sumed by their 8on. - : rtgage = November 10 — Donated P300,000 to the sister of Mr. Obed wath cancer They conated the ‘amount for the medication of i diag, ~ Obeds sige ter, December 15 - Sold 300,000 shares of stocks from Quarantix ther daughter for P300,000. The book valle per share as 8 Comporat fronoa! statements of Quarantine is P1.60 per share, Th Per late ae taere acquired two years ago for P200,000. © shares of Fie au 8 was as 58 How muchis the donor's tax still due of Mr. Obed on the Januay Y 31 tran stern A. P45,000 Cc. P3,000 8B 12000, D None ao : To son (500,000/2) one Less: Deduction (100,000/2) P 250,000 et gift ~59,000 lass: Exempt gift 200,000 Taxable 250,000 60. How much is th rs le donor's ‘tax due of Mrs. Obed on’ the 0 7 November A P6,000 * 9,000 C. P21,000 Di None Qa Net ' a Neg 0/2 . atl ay P50, lie : ,000 ® Exempt gig 200,000 350,000 250,000RET ne RV po , gaxable 100,000. gax rate 6% tax due ~ £920 capital gains tax Fi How joa is the gi due of Mr, Obed on the December 15 sransio"” ae 22,500 - GP 15,000 B - 44,250 DB, 7,500 a D Selling price ‘P 300,000 Less: Cost avs * 200,000 Capital gain x ¢ . 100,000 x Share of Mr. Obed - 3/2 Taxable ; « "50,000 Rate of tax 2 we 15% Capital gain tax © +, =. 4500 ow much is the donor’ tx etl ie of Mr. Obed on te Doconer 19 wransfer?, ; A P 4,500 Cc. P.25,500 B. None Dp. — 9,000 ga Fair market value (300,000 x P150) p 450,000 Less: Selling price * © * at ; Deemed gift 150,000 Share of Mr. Obed —w2 Taxable 2 75,000 Rate oftax “ 6% Tax due 4500 Numbers 63 to 65 are based on the folowing information ce te folowing seer mai e ©. Wight an American citzen residing in New YO" cae donations in 2020: eter180 __— a Doming, his INO friend in vanuary 18 ie ay situated in the Philippines worth Prey of ay, 20 - To his legitimate a Simmang, q Tesideny k February Philippines, on account of her Marriage to i oF ty boyfriend, a condo unit in “Quezon City SFr 1,600,000 but with a cost of P1,200,000 keg? n_ accredited non-govemment ones ~ Te are meters of land valued at P1500 pe ey - his brother, Diony, a naturalized Fiji, rete August 5 ve ding in lloilo City, car worth P600,000, lipino Gis, On the January 18 donation - to be paid because the donor is a nonresident ajien, B Nes Saree is P240,000 because the donee is stranger to by Ci Srauees tax because the value of donated property’ does mi exceed the exempt amount of P250,000,, D. No tax is to be paid because both the donor and the donee are nonresident of the Philippines. Qc N Net gift 180,000 Less: Exemption ae 250,000 Taxable " : 64. The donor's tax payable on the February 20 donation is - A P 91,800 C. Not taxable 8B 96,000 D. P 114,300 Ma To Simmang 3 P 1,600,000 Graeaited NGO (250x500) = _aps.000 ere = 1,975,000 aot 7 1,600,000 i Net gi 7 Total 2 January 28 180,000 1,780,000iple Choi i 181 ok ; Exemptgift ble Tipe of tax ue ee ‘Tax paid, Jan 18 Tax payable qne-donors tax payable on the August 5 donation is - Exempt ©. 36,000 & 21,000 D. 127,800 om ¢ : Net gift P 600,000 Rate of —— 6% Tax payable ; 36.000 here is no more need to apply the cumulative system of computing the tax pecause the exemption of P250,000 had-already been claimed in the previous donations. 66. When the donee or beneficiary is a brother-in-law, the tax payable by the donor shail be ‘ - A. 30% ofthe gross gifts. B, - 30% of the net gifts. ie it c. 8% of the net gift if the donation is beyond P250,000. D. 6% of thenet gift. @ sc’ 67. The following donations were made in 2020 by a domestic corporation: To the Department of Social Welfare for public use P 600,000 To another domestic corporation i 700,000 To The Medical City, Personal Protective Equipment (PPE) for use’of hospital personnel op Covid-19 patients i , ‘The donors tax due on the above donation is182 ___— A P-15,000 B 27,000 8 = 6 P 600,000 pswi ‘ TT mestc exporation 700,000, The Medical City 329.009 Gross gift 1,600,000 tes Dee P 600,000 The Medical City 300,000 Net gift 700,000 Less: Exemption ‘Taxable amount 450,000, Rate of tax gy Tax due 22.900 Numbers 68 to 71 are based on the following information: 68. Cosa, widower, gave the folowing donations: 2019: March 4 To his daughter, Sigue-Sigue on account of mairi i roan ‘elcbrated in five (6) months, P200,000,, oe lila mi4 To his housemaid, Bahala, on account of, marr: to hi ron ariver, Oblo, P100,000, * an i lay4 To his son, Sputnik, for passin PA: Licensure Examinations, 120,000, Hisar To Drago, for winning pan Games held at Busan, June 4 Gold Medai in billard in the Asian South Korea, P250,000, To his bodyguard, Max o i is pr yore en account of marriage to his privae Pram Oy oat worth P500.000 with anne range a 00 to be astumed by Max. © donor's tax due on ' if the font A Gas March 4 donation is - 1,800 GQ D. P 200,000Piles tei - Multiple Choice ft 183 ross a : P20, Exer] 000 teat 250.000 spe donors tex due onthe April 4 donation ig. 3,000 C. Exempt B "6,000 D. P48,000 o* 7 iet es esas * 200,000) P 100,000 Taxable amount: ~52.000 Rate of tax 50,000 Donor’s tax due ; 8% 7h. The donor's tax payable on May 4 donation is - A P5,600 C. 22,200 8 6,400.» Di: 7,200...« @ oc To Sputnik Drago Gross gift Rate of tax ** Taxpayable. "The donor’ tax due on the June 4, 2020 danation is — A P7800 c. P9000 - B- 3.000 D. Exempt Qegy BLTAXATION= Atbongay P 500,000 m Max 200,000 » ~ 400,000 oe gi qgensumed y 400 2 : 000 ha pacmpt ait ; Een “apie amount Rate of tax - 8% Tax due 9,000 P 300,000 to Nee, a ni d property worth ) sont mong Ty a donate donation by Don in 2020. Which of the Rae De need not be complied by Don’ rates inthe donor's tax table. A. File donor's aX retum raduated ‘ pute ox 02800 00 8 ee, ofthe taxable aMOuNE 8. donor's tax ay conor 18,000. eae @° s 73. Levox Corporation ion as prize money for the world professional billiard championship to be held in the Philippines. Since the Billard Sports Confederation ‘of the Philippines does not recognize the event, it was held under the auspices of the International Professional Bilierds ‘Association, nc. Is Levox subject to the donor's tax on its donation? (BEQ) No, so tong as the donated money goes directly to the winners and not wanted to donate 5 mill A ; ery the association. < 3. Yes, since the national ati ili i ic Gear nal sports association for billiards does not sanction under C. No, because it i P ‘ : pe Yes, but only that part that exceeds ae donations for the calendar year, the first P250,000.00 Gs total Levo Q 8 Of the property an) to hi amounts to P500,000 as of J8” Sa Datu on January 5, 2019 and notte On January 6, 2019, as reflected in the deed 74, Ampo whose free port 2019, donated 300,000) 300,000 donation, 0 Ghoria, a frire Multiple Choi te Il i much is the tax due on the January 6, 2019 donation? . Hi p 6,000 _ ©.» P-80,000 A 42) Y D. Exempt 6 tion Free Famount of donation on January § : H oe je palance (available for disposal) 200,000 Rate of tax HE GN Douor'staxdue 12,000 if, there peing two or more donations, the disposable portion i sufficient to cover all of them, those of the more recent ata thal be suppressed or reduced with regard to the excess (Art. 773, Civil Code). 75. n 2020, Otelo gave cash of 80,000 as a.birthday gift to his son, John. Otelo has not given any other gifts.or-donation in 2020 but'made a donation to his daughter in the same amount in 2021. Based on the above information in 2020, Otelo is — : A. Liable to pay donor's tax. B. Liable to pay donee’s tax. Exempted from paying donor's tax. D. Exempted from paying donee’s tax. mc 16. Donation to non-profit institution Is tax exempt if the following requis oe complied, except pine Counc for NGO a The nettution ie ‘accredited by the Philp tification (PCNC). _atration purposes. B. Not more ate So ote gift ia used for administer er the amount iS c The donor must inform the RPO neon i jeast P50, ; : D. Devoting all eae to the accomplishment of RS purpose. Qc_ 186 77. 78. e all give notice on every donation in using $01 Er aaiction over his Pave of buna donor engaged in Dust as ju ns what aR i certificate of Donation, TaanEt = ithin 30 3S cipt of Simpl’ th gow equrer™ a 10,000 and made a donat; istmas gift of P500; a xu gave ner eons # Ce," gne also donation er () arco of ana P100,000 to her Pa nt of QUEZON City and the other for the construction ni Association, @ non-siock, non-profit ees leased to generate income for the puiiarng 1 2 Sr Ce jowing statements is not correct? 400,000 to the Parish Church is exempt from don i me er har 30% of the said donation shall ‘be used me donee for administration purposes. 7 a B. The donation of a parcel of land to UP Alumni Association is exempt from donor's tax because itis made in favor of an educational institution, C. Aportion of the Christmas gift of P500;000 to ‘Ara’s parents is subject to tax because it exceeded the exemption from donor's tax. D, The donation of @ parcel of-land to the Government of Quezon City is ‘exempt from donor's tax. it Q 8 ; ‘ The following donat ee MeeaO a aT TH ele 18 of the cee pal were given by Patricia, a resident alien, on Februay To the Philippine Gover To his yermment his son as a wedding gift held 2 months ago P 00 Birthday gift to a friend Wedding gift to his friend's son : 2o.c0) i a : 20,000 du donor's '@ on the donations yiverrby Patricia is — A P4200 Man C.. p48,400 D. “47000: - QO «4jhe ys Of ‘ Pa Tethe philippine government : panes j fiend, , gens! 5 $00. ee ross Bit sion ~ Philippine government 770,000 netait ‘ft 270, fess: Boemet gt s 220.000 sable amount 20,000 gate of tax if 6% Gitex Tt ; 1.209 cathe ne 07 ransfer for insufficient consideration does not apply to A. jewelry for personal use “aC. “vacant lot B. delivery truck © oe cy By apartment house mM ¢ does not apply to 4 The rule on transfer for insufficient: consideration transfer of real property which is classified as capital asset (subject to final tad. Avacant lot is 2 real property and at the same time a capital asset. & Abarca sold his car to his friend, Bengala for P300,000 wher its value was 600,000. The property was ‘acquired by Abarca for 950,000 in 2015. Six (6)months after the sale, Abarca died. OP that date, the property W2S valued atP900,000. The donor's tax due 15 - A P3,000 c, P90,000 8 48,000 Dp. None Qa aaa value 7.600000 feaen ae 300,000 os Exempt gift . or “000 ‘axable amount Q 68 eof tax 0 Donor’s tax88 ERIN TAXATION — 1 - fter the sale, it cannot pe ied six months ai 7 Although the sles died contemplation of death. ence ie Sy sees sonsdetaon is subject to donor's inadeq for ick lix_has only hysician that Felix. One eae 81. Upon Bene come decided to sel! his house and jot ® me ie because of on 000. The real property was purchased by ner og ye 000000, but now ites a market value of 7000 000. ey a taxes is due on the sale? MCh of ‘A. Donor's tax because of deemed gift and the saie was Made ring . lifetime of the donor, Capital gains tax regardless of whether income is eameq OF Not on the sale B. C. Estate tax because the-sale was made in . Contemplation of death, . Value-added tax because a sale-of real pt roperty is subject to'yaT. mec . | The rule on ‘transfer for. insufficient consideration on donor's tax will not apply because the. real Property:is a capital asset, Moreover; the ‘sale was made in contemplation of death, . - The exemption of a Teal property capital asset on consideration in donor's taxation does not apply in e: 82, pracaya made it appear that he Sold his properties to oes: ts role for insufficient state taxation. his son at the following Residential house P 100,000 Personal properties S0000 The correct fair Market value on the date Sale was P4;000,000 forthe house, and P500,000 forthe Persona} Properties, : Assuming that: yee the facts as a BIR ofcer, the totl donors €ndior income taxes Payable on the transaction is — - ; A P 12000 72,000 CS. None P 60,000 PasFair market value (perso) Less: Selling price 189 Deemed gift a a Less: Exempt gift 4 Taxable amount 208 Rate of tax Donor’s tax due : aa Fair market value (residential house) Rate of tax Capital gains tax ‘ ae Donor’s tax pees Capital gains tax sao) Total taxes due oF S200 = The rule on transfer for insufficient ideratioy transfers of real Properties which are capital assole Hone mei subject to the 6% capital gains tax acces Aresidential house is a Peal property, capital asset. 83. Which of the following is subject to donor's tax? A. Sale on promo of Toyota Fortuner to B by Toyota North Edsa. The fegular price is P4.8 million; sold at P4.6 million. Sale of a residential jot. Market value is P1.5 milion but sold for P 1 million only. : : nee A dying man sold his brand new car worth P1.8 million for P80, only. 3 i o Salo of a commercial building valued at P20 million for P12 milion only. 9p 9° f@ B DC. TAX CREDIT and ADMINISTRATIVE PROVISIONS 84. Carina, Filipina, had the following data: Net gift, Philippines P 150,000 ; , Net gift, United States 450,000 P Donor's tax paid in the United States 7,500, The donor's tax payable on Carina is — P 20,000 C.. P 12,500 3 1,000 D. 13,500 Mo Net gift, Philippines oad Pp 150,000 . Net gift, United States: - “450,000 Total net gifts B Gaciond Less: Exempt gift . _ 250,000 Taxable amount 5 3 350,000 Rate of tax 6% Donor’s tax due " 21,000 Less: Tax credit Tax paid, US Limit (45/60x21,000) . i5750 Credit allowed Gower) 2500 Donor’s tax payable 5 13,500 85. Django, resident citizen, made the following donations on May 6 of the Current year: P 175,000 - To his si i i Angeles ister, Diana, Property situated in Los Al . U.S.A. The donor's tax paid in US. is P3.500 ra, his girffriend in the Philippines. ational Rice Research Institute. eis — California, 225,000 - To Barba 50,000 - To Inter: The donor's tax payablultiple Choice Questi ogsTax—™ tol ns 191 69,000 C. P5500 i 90,188 D. No tax credit allowed c a ‘To Diana P 175,000 Barbara 225,000 gross eft . a gif ction - IRR 450,000 Net gi 400,000 ess: Exemption 250,000 ‘Taxable amount ~..... 2 150,000 Rate of tax re : Donor's tax : Se pe . 9,000 Less: Tax credit Tax paid in U.S.A. ., 83,500 . Limit (175,000/400,000 9,000), .'» 3.938 -» Allowed (ower) 3.500 Donor's tax payable : 5.500 86. Philip German, filipino resident of Germany, donated a real property in Germany worth PB00,000 to his homosexual brother, Felipe Espafiola. Jose paid a transfer tax of P20,000 in Germany. German in the Philippines? How much donor's tax should be paid by A P 13,000 CG. P-12,000 B 20,000 D. Zero Ma Net gift P-800,000 Less: Exempt gi 250,000 ‘Taxable. ae sift 550,000 Rate of tax ¥ 6% Tax due t gg,000 Less: Tax credit Tax paid, Germany. me, 20,000 limit (800/800 x 3: 900) 33.000 35.000 credit allowed (lower) 33,000 Donor's tax payableINT. ie P40,000? in Germany was 2 ? 87. How about if the tax paid in Cc. P 12,000 A P32,000 ae B. 20,000 mM oD 33,000 Donor’s tax due coon P 33,000 : Tax paid in ; oe im (800/800 x 33,000) 33,000 e credit allowed (lower) 23.000 _ Donor’s tax payable 0. ; ‘88. When a propérty is donated, the basis of the donor's tax is - A. The cost of acquisition if acquired by purchase, or the fair Market value at acquisition date, whichever is higher. 8. The agreed upon value of the donor and the donee. C. The fair market value at the time of the donation. : D. Any of the above. c B 89. Which statement is false? Shares of stocks shall be Valued unlisted common shares ~ using adjusted net asset method. i ff unlisted preferred shares — par value {unlisted common shares — book value 2 34h Iflisted shares ~ arithmetic mean of highest and lowest quoted prices in the stock exchange on the valuation date pom> fa 90. ee ie A aed eal property cannot be registered in the nae ®. unless the donors se donation had already been roe ahem crneaa [at ya i, ed Satnent tan FyCae® 918 deficiency donor's tax, the donee shal ber the property is already in his Possession.the first statement IS true. lo; oes the first statement is false. : 8 Both statements are true, os Both statements are fatse. (cee jj statement i: Gniy one retum Shali be tited 4 Cf it Sorte the diferent donoes or fa same data, "Ot (conatony ny Statement 2: If the. donation involves conj Mi spouse shall fle separate retum corresponding emmunty ce the conjugal/community Property, Fespective share in A. True, False C. .Trie, True j B. False, Tue a 0.» False, False g@oc 82. On December 25, 2019, Mr. and Mrs. Cruz donated 200,000 in cash from their Conjugal assets to each of their three children. ‘For Purposes of paying Sonor's tax, they should file A. Ajoint retum of the total donation of 600,000 . B. Three joint retums for P200,000 donation e each child. C.° Two ‘Separate retums for P600,000 by each spouse. 5. Two sepatate retums for'a donation of 300,000 by each spouse. nn) *S Donors tex retum shall be fled within A 30 days after the gift has been made | Si grits from the date of oi : | - 25 days after giving the gi 80 days after the end of every quarter. Qa‘on March 3, 2018. The Aonaton 194 of a car 10 ee cof donation signed DY B, 2, wees 94. Assigned 2 0006 ‘deed W2S 6. Physical possessi seep 2 se) P Pye Posen oe pence 0 NT j was ransfored tne 30-08 period for sling Pee a ae ting pat atx shall ‘commenc® on 3 ae : 8 varss D. March7 B Ma cag : ; isa donation by one donor to tis ‘one date, there ali to a relative by affinity, there will be two (2) sratement 2: n donors #2% 90 extension of time for filing the’ donors tax retum is allowed. ‘A. Statement 1 is correct, while Statement 2 is wrong. B. Statement 1 is wrong, while Statement 2 is correct. ._ Both statements.are correct: 5 z D. Both statements are Wrong. mB 4 - ‘The provision inthe National Internal Revenut i i QF ¢ Code on extension of time ean bas be deleted. Therefore, itis clear that extension of time for 1's tax return is no longer allowed by law. 9%. Given the following statements: Statement 1: The ibe came enor Me come donated property aft the dorafon but before registration in the arse ‘of the donee 3@ a liability of the donee. ‘Statement: The ie 30 ce peti or finde donors an return ard SET ce date of ME Physaly doiveredte inode hag not yet bee”195 's tax retum shall be filed at the f the donor or of the donee, at the a . The donor’ ent 3! residence ©! donor. 4, incase he committed an error in the computation of giaterent donor shall be required to pay a deficiency tax ee i property is already in the possession of the donee. 5; The donor shall file separate donor's tax retums for each syaternont donation even if these were made on the same date. ge the best answer: sl F Statements 3 and 4 are true. gh. coe : The income tax on income of a donated property which is not yet ‘ejstered in the name of the donee is stil payable by the donor ‘The place of payment of the donor’s tax return is fixed by laws at the place of residence of the donor and is not subject to his option, Thr al oniybone donor's on donations maleon ee 47. The donor's tax return shall. contain the following, except A. Allprevious net gifts made by the donor. 8. The deductions claimed and allowable. ‘ Name of the donee. . Tax Identification Number (TIN) of donee. Qa % One 88 . of the followi i attachment to on dong, ing is not required a5 an tion made in 2019 donor to the donee. Ag wom statement of the relationship of the Certtied true copy of the create of Tie of te donated property. the donor's tax returnA ted to Arturo @ property in tg - cont of DaguPaM Ci fe goad of donation was sgneg at go, marct, #25 ax is P ,000. Te conor's 12x FetUrM Must Ted in THe done’ jo in BagUO yy io City a vagupan OH D. co g_ tacag City ao i ssi f Internal Revenue otherwi missioner ol enu oe sept ina where Cortal be ied and the tx palin the cy its, the dono! ed a Came Punicipality where the donor was domiciled uestion, assuming the donors tax return was filed and the - tee potin Bago City, the amount still due.on Manolo is-- ‘A P 10,000 - G& - P-40,000 B . 50,000 : . DB. 20,000 Ma : aa Donor’s tax due per return P4000 Add: Penalt 00 cal mad (40,000 x 25%) Fe Less: Amount al : 19,000 Amount still ery paid E 000 19,000 1 (01. Which of the following statements is correct? Statement 1; ti + Ih case of git ith ne Pats edo by @ ronresient, the retum maybe ie he is domes pine Embassy, or consulate in the county i led at the time of the transfer, or directly wit N° 2 of the Commissioner.a “5 TAX = Multiple Choice tions , 2: A nonresident citizen don, 97 giatement abroad must claim tax re nears Property situateg Viability even if there ig NO other luce his ¢ Stax particular date, Gonation made 0 that statement 2 S. Both Statements A Statement 4 D. Neither statement go c questions 102 to 4107: Bigay made the following donations: 9 ee P150,000 . To his brother, Utol May 20 300,000 ' To Biyenian; his fatherin-taw. Gach Seca To Biyenan; on-account’ of mariage during the year June 3 400,000 To Utol ‘02. The tax due on the January 10, 2019 donation A 3,000 ~ Cy” Exempt 3B. 9.000 BP ,000 Me ToUtol P 150,000 Less: Exempt gift ee Taxable - "5.7he tx ue on the May 20, 2018 donation & P 42.000 C: -P18,000 3 90,000 Oca Qa —EWER.IN TAXATION — ,° 198 Ce P 300,000 - tel + 150,000 5 ic ne Total net gifts 250.000 Less: Exempt gift 200,000 Taxable gift ; “6% Rate of tax 5 1 ) Rael ; _ 2.900 104 In the immediately preceding question, if the return is fileq 209 the tay July 18, 2019 the total amount payable (excluding compromise ena ra (round-off centavos to the nearest peso) . i A P113,269 eo 8. 15,103 D, 90,000 8 Taxdue gre eee eae ) Add: Surcharges a PHP000 Late filing & payment (12,000 x 2 b (124 5%) 3,000 Fone ea * 26/365) e 7 3be ; : i ‘ 45,103 "05 Theta gon Mac 2020. - E 30,000 . 2 150.000 _C. P415,000 ; 22) 14,000 Qe ra gift i eee Eaerpt sift P 500,000 haere 250,000 ‘ oe 250,000 106, 00 The : ee . ta due on the June 3, 209, z Q Pas 000 £020 donation is 009 S P 10,000 *199 P 400,000 a yor, in the eee Neweeton if the retum is filed 2020 the jount payable (exctudi 8nd the tax ig centavos to the nearest peso) ng compromise penatyy ie (ut is (round-of . P30,408 B 30.245 Bene ‘ s mpt m@ 8 Tax due 24,000 Add: Sarcharges , ‘ Late filing & payment (24,000 x 25%) Interest (24,000 x 12% x 3 ye eae Amount payable Eee 30,245 Problem Don Ted Lootey a resident of Biak ria Bato St, Naga City with TIN 917-352-083 made the following donations in 2079: May Dondie, brother; Jand worth P2,000,000 margaged with Cinabank for 300,000 to be assumed by Dondie June 12 Donita, sister, with TCT #147-985-320, 1) Corp, not traded. Book value, PSO per share; TCT 1456987, TD 1 market value per 000 common shares of A par value, P30. 2000; Area: 5,000. Residential lot in Naga City, 97. ce ae sq m; zonal value P3,000 per $4 laration P 12,000,000.9 The amount Box 36 |S 16,500,000 8 46.730.000 ene 3, The amount in Box 38 is A 16,500,000 B. 16,730,000 ma 4 The amount in Box 16 is A. P900,000 8. 903,000 Qa 5. The amount in Box 20 ig ieee 903,000 QB gO 29 oa P15,050,000 16,750,000 P15,050/000 146,750,000 P 886,000 901,800, » P 888,000 © 901,800,OR'S TAX = Multiple Choice ti : 0 , : 201 gotution: personal properties (3,000 x P50) Real property (P3,000x 5,000) ~ P 50,000 ‘otal gifts in this return 15,000,009 Less: Deduction allowed 45,050,000 ‘otal net gifts in this return add: Prior net gifts during the yaar (p pe cooe pera 2M~ 300,000) _1.700,000 Tass: Exempt gift oe Total net gifts subject to tax Pre Applicable donor's tax rate : mmc Total donor's tax due 990,000 Less: Payment for prior gift cong the ea 87.000 Amount payable : ° es 903,000