DONOR’S TAX REVIEWER

1. An act of liberality whereby a person disposes gratuitously of a thing or right in favor of another who
accepts it.
a. Succession c. inheritance
b. donation d. liquidation
2. When the donor intends that the donation shall take effect during the lifetime of the donor, though the
property shall be delivered till after the donor’s death, this shall be a
a. Donation mortis causa
b. Donation inter vivos
c. Donation propter nuptias
d. None of the above
3. When is the donation period perfected?
a. The moment the donor knows of the acceptance by the donee.
b. The moment the thing donated is delivered, either actually or constructively, to the donee.
c. Upon payment of the donor’s tax.
d. Upon execution of the deed of donation.
4. The following are the requisites of a donation for purposes of the donor’s tax, except one:
a. Capacity of the donor.
b. Capacity of the donee.
c. Delivery of the subject matter or gift.
d. Donative intent.
5. For the donation to be considered valid, acceptance of the donation must be made
a. During the lifetime of the donor only.
b. During the lifetime of the donee only.
c. During the lifetime of the donor and the donee.
d. None of the choices.
6. Which of the following donations inter vivos may not require that it be made in writing?
a. Donation of personal (movable) property, the value of which exceeds P5,000.
b. Donation of personal (movable) property, the value of which is P5,000.
c. Donation of real (immovable) property, the value of which is less than P5,000.
d. Donation of real (immovable) property, the value of which exceeds P5,000.
7. Which of the following statements regarding donation of an immovable property is incorrect?
a. The donation must be made in a public document specifying therein the property donated and the
value of the charges which the donee must satisfy.
b. The acceptance may be made in the same Deed of Donation or in a separate public document, but it
shall not take effect unless it is done during the lifetime of the donor.
c. If the acceptance is made in a separate instrument, the donor shall be noted in both instruments.
d. None of the choices.
8. One of the following is not a distinction between donation inter vivos and donation mortis cause.
a. Donation inter vivos takes effect during the lifetime of the grantor while donation mortis cause
takes effect afte the death of the grantor.
b. Donation inter vivos is subject to donor’s tax while donation mortis causa is subject to estate tax.
c. Donation inter vivos requires a public document while donation mortis causa may not require a
public document.
d. Donation inter vivos is valued at fair market value at the time the property is given while donation
mortis causa is valued at the fair market value at the time of the death of the grantor.
9. Motivated by love, Mr M donated a car to his brother, Mr. N and Mr. O, the naked title of Mr. P and
usufruct to Mr.Q for one year. Is the transfer of the car, naked title to Mr. P and usufruct to Mr. O a
vadie donation?
a. Yes, the transfer of the naked title to P and usufruct to O is valid donation, provided all the donees
are living at the time of donation.
b. No, the donation is not valid because it is specifically provided in the Civil Code that such donation
is not allowed.
c. Yes, the donation is valid provided that Mr. N agrees to the donation of usufruct to Mr. Q.
d. No, the donation is not valid because the right (usufruct) cannot be donated.
10. Which of the following is a stranger for donor’s tax purposes?
a. The son of the donor’s first cousin.
b. The donor’s grandmother.
c. The donor’s spouse
d. The child born out of wedlock of parents who are legally impeded to marry each other at the time
the child is being conceived.
11. Mr. Pedro Paterno died and was survived by his wife and two (2) children, Fame and Fare. After getting
married her share in the conjugal property, the surviving spouse renounce her share in the hereditary
estate in favor of Fame to the exclusion of Fare. Was the renunciation subject to donor’s tax?
a. Yes, because the renunciation as made categorically in favor of identified heir to the exclusion or
disadvantage of the other co-heirs.
b. No, because the renunciation was considered a general renunciation.
c. Yes, because, as a rule, renunciation of share in the hereditary estate is always subject to donor’s
tax.
d. No, because, as a rule, the surviving spouse cannot renounce her share in the hereditary estate.
12. Jose sold his car to Samuel for P200,000. Jose’s car cost P500,000 and had a fair value of P400,000 at
the time of sale. What was the consequence of the sale?
a. There was a taxable give of P300,000.
b. There was a taxable gift of P200,000.
c. The transfer was for insufficient consideration, hence, not subject to donor’s tax.
d. The transfer involved a personal property, hence, not subject to donor’s tax.
13. Statement I – A transfer is gratuitous or without consideration and accordingly qualifies as a donation, if
not economic benefit measurable in money or money’s worth flowed to the transferor from the
transferee.
Statement II – a gratuitous transfer is always subject to donor’s tax.
a. True, true
b. False, false
c. True, false
d. False, true.
14. The common characteristic of transfer taxes is the transfer of property:
a. Is onerous
b. Takes effect during the lifetime of the transferor.
c. Takes effect upon the death of the transferor.
d. Is gratuitous.
15. When the indebtedness is cancelled without any service rendered by the debtor in favor of the creditor,
the forgiveness of debt will result to:
 a. Taxable income
b. Distribution of dividend.
c. Taxable indirect donation.
d. Taxable estate.
16. Which of the following examples is not taxable?
a. A Filipino citizen donated a parcel of land located in the United States to B, non-resident alien.
b. On June 1, 2001, A made a gift of P200,000 to his daughter on account of her marriage celebrated
on May 1, 2000.
c. Mr. Ramos gives his girlfriend a diamond ring worth P100,000 as a birthday gift.
d. A and B are the only heirs of C. A renounces his share of inheritance in favor of B.
17. A non –resident donor is taxed on his donation of properties:
a. Situated in the Philippines only.
b. Wherever situated.
c. Situated outside the Philippines only.
d. Situated in the Philippines only subject to the rule of reciprocity.
18. The rule of reciprocity that applies to estate tax also applies to:
I – non-resident alien donor
II- intangible personal property situated in the Philippines.
a. Both I and II are correct.
b. Both I and II are incorrect.
c. Only I is correct.
d. Only II is correct.
19. The donor is a non-resident, not a citizen of the Philippines. Which of the following statements is
incorrect?
a. Property situated outside the Philippines donated to a citizen of the Philippines will not be subject
to Philippine donor’s tax.
b. Property situated outside the Philippines and donated to a donee who resides outside the
Philippines is not subject to Philippine donor’s tax.
c. Property situated in the Philippines donated to a legitimate child on account of marriage will be
entitled to the P10,000 dowry exemption.
d. Property situated in the Philippines with a fair market value of P150,000 and donated to a citizen of
the Philippines will be subject to Philippine donor’s tax.
20. Dowries or gifts made on account of marriage of children shall be exempt from donor’s tax if given by
parents:
I – before its celebration
II – within one year thereafter
a. Both I and II are correct.
b. Neither I nor II is correct.
c. Only I is correct.
d. Only II is correct.
Reference: section 101 A, NIRC. As amended under section 30, TRAIN
21. The amount of the exempt dowry is to the extent of the first:
 a. P32,000 c. P10,000
b. P25,000 d. none
22. When the done or beneficiary is a relative or a stranger, the tax payable by the donor shall be:
a. Six percent (6%) of the total gifts.
b. Thirty percent (30%) of the gross gifts.
c. Thirty percent (30%) of the net gifts in excess of P100,000,
d. Forty percent (40%) of the net gifts.
23. The spouses Criselda and Kardo wanted to donate a parcel of land to their daughter Myrna who is
getting married in December 2018. The parcel of land has a zonal valuation of P420,000. You are
consulted as to how should they make the donation to save on donor’s tax. What advice will you give
them?
a. They should first donate in 2017 a portion of the property valued at P20,000 then spread the
P400,000 equally for 2018, 2019, 2020 and 2021.
b. They should spread the donation over a period of 5 years by the spouses donation P100,000 each
year from 2018 to 2022.
c. They should each donate a P105,000 portion of the value of the property in 2018 then each should
donate P105,000 in 2019.
d. They should each donate a P100,000 portion of the value of the property in 2018, and another
P100,000 each in 2019. Then, in 2018, Criselda should donate the remaining P20,000.
24. Pat donated P110,000 to her friend Kim who was getting married. Pat gave no other gift during the
calendar year. What is the donor’s tax implication on Pat’s donation?
a. The P100,000 portion of the donation is exempt since given in consideration of marriage.
b. A P10,000 portion of the donation is exempt being a donation in consideration of marriage.
c. Pat shall pay a 6% donor’s tax on the P110,000 donation.
d. The P110,000 donation is exempt from donor’s tax.
25. The following donations during the calendar year 2018 are made to relatives:

Date Amount204,

March 30, 2018 1,000,000

August 15, 2018 500,000
26. How much is the tax due on the gift made on January 30, 3018?
a. P204,000 c. P80,000
b. P105,000 d. P50,000
Jan 30, 2018: taxable net gift P2,000,000
Tax due and payable
P250,000 exempt
1,750,000 X 6% P105,000

27. How much is the tax due on the gift made on March 30, 2018?
a. P204,000 c. P60,000
b. P124,000 d. P50,000

March 30, 2018: Gift P1,000,000

 Add: previous net gift 2,000,000
Total taxable gifts P3,000,000
Tax due P250,000 EXEMPT
P2,750,000 x 6% P165,000
Less: tax paid prior gift 105,000
Taxes payable P60,000
28. How much is the tax due on the gift made on August 15, 2018?
a. P204,000 c. P80,000
b. P124,000 d. P30,000
29. On January 1, 2018, Demmy gave a piece of land to her brother in law who is getting married on
February 14, 2018. The assessed value and zonal value of the land were P750,000 and P1,000,000
respectively. The land had an unpaid mortgage of P200,000, which was not assumed by the done and
an unpaid realty tax of P10,000 which was assumed by the done.
What value hall be reflected in the gross gift?
a. P1,000,000 c. P750,000
b. P800,000 d. none of the choices.
30. Based on no. 29, how much shall be the total deductions?
a. P210,000 c. P10,000
b. P200,000 d. none of the choices.
31. Based on no. 29, how much was the donor’s tax due?
a. P297,000 c. P44,400
b. P237,000 d. 31,400
Gross gift P 1,000,000
Less: unpaid tax assumed by done 10,000
Taxable net gift P 990,000
Tax due and payable
P250,000 EXEMPT
P750,000 X 6% P44,400
32. Based on information no. 29, when shall be the due date for the filing of donor’s tax?
a. February 14, 2018 c. March 15, 2018
b. February 15, 2018 d. July 15, 2018
33. On June 10, 2018, Mr. Pablo Sacro donated P50,000 cash to his favorite grandson who is getting married
on June 16, 2018. For donor’s tax purposes, the exempt dowry shall be:
a. P50,000 c. P5,000
b. P10,000 d. none
34. On March 1, 2018, Mr. Pedro de Leon donated a piece of land to his best friend, Gerson Rocero. He also
donated to a non-profit religious organization. The donation to his friend was a piece of land which had
an assessed value of P1,000,000 and zonal value of P800,000 at the time of donation. The donation to a
non-profit religious organization were cash amounting to P200,000 and an automobile with a purchase
price of P700,000. The piece of land was encumbered with an unpaid mortgage of P300,000 which was
assumed by the done. In addition, the done agree to pay the applicable donor’s tax of P210,000.
How much should be included in the gross gifts?
a. P1,900,000 c. P1,000,000
b. P1,700,000 d. none of the choices
Piece of land, assessed value (higher) P1,000,000
Automobile (purchase price) 700,000
Cash 200,000
Total gross gifts P1,900,000
35. Based on information no. 34, how much was the total deductions?
a. P1,410,000 c. P510,000
b. P1,200,000 d. none of the choices
Gifts for a non-profit religious organization P900,000
Unpaid mortgage assumed by the done 300,000
Total deductions P1,200,000
36. Based on information no. 34, what were the taxable gifts?
a. P700,000 c. P290,000
b. P490,000 d. none of the choices.
Gross gifts P1,900,000
Less deductions 1,200,000
Taxable net gifts P 700,000
37. Based on information no. 34, how many donor’s tax returns should be filed?
a. Three c. one
b. Two d. as many as possible
38. Based on information no. 34, would notice of donation be required on these donation?
a. Yes, on all donations.
b. Yes, but only on donation made to a religious organization.
c. No, on all donations.
d. No, notice of donation is not required for donor’s tax.
39. Ms. Josie Pinto, a resident donor, made the following gifts in the year 2018:

Date Donations
June 6, 2018 P50,000 to Jaimee, an illegitimate daughter on account of her
marriage celebrated on June 8, 2018.
August 11, 2018 A piece of jewelry purchased by Ms. Pinto for P100,000 (but ith
a fair market value of P150,000 at the time of donation) given to
her husband.
October 12, 2018 P50,000 to Maritz, her legitimate daughter, on account of her
marriage on December 25, 2017.
December 25, 2018 P20,000 cash donation to a non-profit philanthropic
organization.
The taxable gift of Ms. Pinto on June 6, 2018 was:
a. P50,000 c. none, not subject to donor’s tax
b. P40,000 d. none of the choices
Gross gift P50,000
Less: deduction -
Taxable gift P50,000
40. Based on information no. 39, the amount of taxable gift made on August 11, 2018 was:
a. P150,000 c. none, not subject to donor’s tax
b. P100,000 d. none of the choices.
41. Based on information no. 39, the total taxable gifts of Ms. Pinto as of October 12, 2018 were:
a. P100,000 c. P40,000
b. P90,000 d. none of the choices
Gross gift, October 12, 2018 P 50,000
Add: prior gift, June 6, 2018 50,000
 Total taxable gift P100,000

42. Based on information no. 39, the total taxable gifts of Ms. Pinto as of December 25, 2018 were:
a. P200,000 c. P100,000
b. P140,000 d. none of the choices

Gross gift, December 25, 2018 P20,000

Less: donation to philanthropic organization 20,000
Net gift P 0.00
Add: prior gift P100,000
Total taxable gift P100,000
43. On January 5, 2018, Emma Rodil, resident donor, made the following donations:
a. To Cristina, recognized natural child, land in the Philippines valued at P310,000, on account of her
forthcoming marriage;
b. To Francisco, legitimate son, car in San Diego, California, USA valued at P500,000 (donor’s tax paid in
USA, P20,000).
The Philippine donor’s tax purposes, the donor’s tax due after tax credit shall be:
a. P32,000 c. P13,600
b. P20,000 d. none
Gross gift
To Cristina P310,000
To Francisco 500,000
Total taxable gift P810,000
Tax due
P250,000 EXEMPT
P560,000 x 6% P33,600
Less: tax credit for foreign donor’s tax
Actual foreign donor’s tax P20,000
Limit (P500,000/810,000) xP33,600 P20,741 20,000
Tax payable P 13,600
44. Michelle is a citizen and resident of the Philippines. On July 8, 2018, she made donations to Yoly, a
friend, of properties in Australia and Thailand. Donor’s taxes paid in Australia and USA amounted to
P20,000 and P5,000 respectively. The property in Australia had a fair market value of P300,000 while
the property in US had a market value of P200,000. How much was the donor’s tax still due after credit
for foreign donor’s taxes?
a. P15,000 c. P1,000
b. P14,000 d. P0.0

Net gift, Australia P300,000

Net gift, USA 200,000
Taxable net gifts P500,000

Tax due ((P500,000-P250,000)x 6% P 15,000

Less: tax credit foreign donor’s tax 14,000
Tax payable P 1,000
 Tax credit limit actual allowed

Limit A by country
Australia
(P300,000/500,000) x P15,000 P9,000 P20,000 P 9,000
USA
(P200,000/500,000) x P15,000 P 6,000 P5,000
5,000
Total P14,000
Limit B by total
(P500,000/500,000) x P15,000 P15,000 P25,000 P 15,000
Allowed (lower between limit a and
Limit b) P14,000

45. Mr. Jerry Yan, non-resident citizen donor, made the following donations on July 15, 2018;
a. To Cherry, a legally adopted child, on account of his marriage on July 31, 2018, a property in
Indonesia (donor’s tax paid in Indonesia, P70,000), fair market value, P510,000;
b. To Adrian, best friend in the Philippines, a property with an unpaid mortgage of P30,000 assumed by
the donee, fair market value, P230,000.

For Philippine donor’s tax purposes, the allowable tax credit is:

a. P74,000 c. P52,857
b. P70,000 d. P19,714.

Stranger Relative
Adrian Cherry
Gross gift P230,000 P510,000
Less: mortgage assumed by done ( 30,000)
Taxable net gift P200,000 P510,000
Tax due
P250,000 exempt
460,000 x 6% P 27,600
Donor’s tax credit
Actual foreign donor’s tax P70,000
Limit (P500,000/700,000) x P27,600 P19,714

Allowed (lower) P19,714

46. A resident citizen has a property in Quezon City. His legal resident is in Masbate City. While in Cebu City
on a business trip, he donated his property in Quezon City to a relative who is long-time resident in Cebu
city. Where will the donor file the donor’s tax return?
a. Quezon city c. Masbate city
b. Cebu city d. any of the three cities.
47. Statement I – in order for donation to be exempt from donor’s tax and claimed in full as deduction, the
done-institution must be duly accredited by the Philippine Council for NGO certification (PCNC).
 Statement II - the donor engaged in business shall give a notice of donation on every donation worth at
least P50,000 to the Revenue District Office, which has jurisdiction over his place of business within 30
days after receipt of the qualified done-institution’s duly issued Certificate of Donation.
a. True, true c. true, false
b. False, false d. false, true
48. When the donor has no legal residence in the Philippines, the donor’s tax return shall be filed with the:
a. Authorized agent bank.
b. Revenue district officer where the donor is domiciled.
c. Revenue collection officer where the done is domiciled.
d. Office of the Commissioner.
49. Which proof of valuation is valid for donor’s tax purposes?
I – for listed stocks - newspaper clippings/certification issued by the Stock Exchange as to the value of
the share.
II – for unlisted stocks – latest audited Financial Statements of the issuing corporation with computation
of the book value per share.
a. I only c. neither I nor II
b. II only d. both I and II.
50. Statement I – a separate return shall be filed by each donor for each gift or donation made on different
dates during the year reflecting therein any previous net gifts made in the same calendar year.
Statement II – only one return shall be filed for seferal gift or donation by a donor of the different
donees on the same date.
a. True, true c. true, false
b. False, false d. false, true