Problem 1

Gross Gifts

A donor made the following donations during the year:

*To Abel, a car worth ₱800,000

*To Jen, condominium unit worth ₱3,000,000 in Macau
*To Gore, GJ Company shares (domestic corp,) amounting to ₱250,000
*To Alexa, ₱100,000 worth of shares of stick of a resident foreign
corporation where 90% of its operation is in the Philippines.
*To Earl, a Building in Singapore valued at ₱5,000,000 mortgaged for
₱2,000,000 assumed by the donee
*To Hanniah, parcel of land in Isabela, ₱1,500,000
*To Chen, ₱100,000 bank deposit to BPI
*To Kristine, ₱100,000 bank deposit in Metrobank, U.S. Branch
*To Gavrie, ₱500,000 cash

The donor also made the following transfer of properties within the year:

Land 1 - Q.C.
Land 2 - Taguig
Land 3 - U.S.A.
Car - Manila

Required: Determine the amount of gross gifts subject to donor's tax

assuming the donor is:

a) Resident Citizen
b) Non-Resident Citizen
c) Resident Alien
d) Non-Resident Alien with reciprocity
e) Non-Resident Alien wihout reciprocity

Answers with solution:

A) Resident Citizen
Cash (100,000+100,000+500,000)
Real Property (3,000,000+3,000,000+1,500,000)
Personal Property
Intangible Property (250,000+100,000)
Land 3 (10,000,000-5,000,000)
Car-Manila (1,000,000-800,000

B) Non-Resident Citizen
Cash (100,000+100,000+500,000)
Real Property (3,000,000+3,000,000+1,500,000)
Personal Property
Intangible Property (250,000+100,000)
Land 3 (10,000,000-5,000,000)
Car-Manila (1,000,000-800,000

C) Resident Alien
Cash (100,000+100,000+500,000)
Real Property (3,000,000+3,000,000+1,500,000)
Personal Property
Intangible Property (250,000+100,000)
Land 3 (10,000,000-5,000,000)
Car-Manila (1,000,000-800,000

D) Non-Resident Alien with reciprocity

Cash (100,000+500,000)
Real Property
Personal Property
Car-Manila (1,000,000-800,000

E) Non-Resident Alien without reciprocity

Cash (100,000+500,000)
Real Property
Personal Property
Intangible Property
Car-Manila (1,000,000-800,000
INTANGIBLE

INTANGIBLE

Consideration Received FMW at the time of transfer

₱2,000,000 3,000,000
3,000,000 2,000,000
5,000,000 10,000,000
800,000 1,000,000

₱700,000
7,500,000
800,000
350,000
5,000,000
200,000
₱14,550,000

₱700,000
7,500,000
800,000
 350,000
5,000,000
200,000
₱14,550,000

₱700,000
7,500,000
800,000
350,000
5,000,000
200,000
₱14,550,000

₱600,000
1,500,000
800,000
200,000
₱3,100,000

₱600,000
1,500,000
800,000
350,000
200,000
₱3,450,000
Problem 8
Cumulative Gifts, Donations by Husband and Wife

Mr. and Mrs. Macariola, made the following donations during 2018:

Date Particulars
February-18 Car worth ₱400,000 to their legitimate son, Ghore Jr., on account of marriage
dated February 10,2017. The car was mortgage for ₱200,000, only 50% of the
mortgage was assumed by the donee.
March-18 To Mr. Macariola's brother, his capital property worth ₱200,000 on account of
marriage 3 months ago. They agreed that the donee shall pay the donor's tax thereon.
June-18 To Charmaine (daughter of Mrs. Macariola by former marriage), Mrs. Macariola's
paraphernal property worth ₱100,000 on account of marriage celebrated one year ago.
October-18 To Charmaine on account of the same marriage, conjugal car worth ₱400,000
with ₱200,000 unpaid mortgage. Charmaine assumed 50% of the unpaid mortgage.
October-18 Parcel of land valued at ₱ 500,000 to their two (2) sons on account of their graduation.
The land was co-owned by the couple and a friend, Clifford, who agreed to donate the
same. The share of Clifford in the property is valued at ₱100,000.

Determine the followig:

a) The gift tax payable of Mr. Macariola as of March 30, 2018
b) The gift tax payable of Mrs. Macariola as of June 1, 2018
c) The gift taxes payable of Mr. and Mrs. Macariola on October 12, 2018
d) The gift tax due of Cifford

SOLUTION:

February 15, 2018

Total Net Gift (400,000 - 100,000)/2 ₱ 150,000 ₱ 150,000
Less: Exempt Gift 250,000 250,000
Net gift subject to tax ₱ (100,000) ₱ (100,000)

A) March 30, 2018

The donor's tax payable shall be nil.

Total Net Gift (300,000 + 200,000)/2 ₱ 250,000 ₱ 250,000

Less: Exempt Gift 250,000 250,000
Net gift subject to tax ₱ - ₱ -

B) June 1, 2018
 The donor's tax payable of Mrs. Macariola shall be ₱ 6,000 computed as follows:

Total Net Gift (150,000 + 100,000 + 100,000) ₱ 350,000

Less: Exempt Gift 250,000
Net gift subject to tax ₱ 100,000
Multiply by: 6%
Donor's tax to date ₱ 6,000
Less: Tax Due in prior donation 0
Donor's tax still due ₱ 6,000

C) October 12, 2018

The donor's tax payable of Mr. and Mrs. Macariola shall be ₱ 21,000 computed as follows:

Total Net Gift ₱ 600,000 ₱ 700,000

Less: Exempt Gift 250,000 250,000
Net gift subject to tax ₱ 350,000 ₱ 450,000
Multiply by: 6% 6%
Donor's tax to date ₱ 21,000 ₱ 27,000
Less: Tax Due in prior donation 0 6,000
Donor's tax still due ₱ 21,000 ₱ 21,000

D)
The donor's tax due of Clifford shall be nil.

Total Net Gift ₱ 100,000

Less: Exempt Gift 250,000
Net gift subject to tax ₱ (150,000)
account of marriage
00, only 50% of the

00,000 on account of
pay the donor's tax thereon.
riage), Mrs. Macariola's
iage celebrated one year ago.
car worth ₱400,000
% of the unpaid mortgage.
account of their graduation.
d, who agreed to donate the
as follows: