BM1903

NAME: DATE: SCORE:

Transfer Taxation (10 items x 3 points: 2 points for each correct answer and 1 point for the justification)
Choose the letter of the correct answer and justify your answer.

For items 1-2. Mr. Jose purchased a piece of land in 1991 for P500,000 when it was worth P450,000. He transferred the
property when it was worth P1,000,000. Subsequently, Mr. Jose died when the property was worth P1,200,000.

C 1. If the donation is a donation inter-vivos, what is the value to be subjected to donor’s tax? a.
P450,000 b. P500,000 c. P1,000,000 d. P1,200,000

Donation inter-vivos, Mr. Jose transfer the property before he died and its worth was 1,000,000.

D 2. If the donation is a donation mortis causa, what is the value to be subjected to estate tax? a.
P450,000 b. P500,000 c. P1,000,000 d. P1,200,000

Donation mortis causa, Mr. Jose’s property was reserved up until his death and the worth of property
was 1,200,000.

For items 3-4. Mang Kiko transferred a property with a fair value of P1,000,000. Title to the property was stipulated to
be transferred immediately. Subsequently, Mang Kiko died. The property was worth P800,000 at the date of his death.
A 3. Which of the following is CORRECT?
a. The property is subject to donor’s tax at P1,000,000.
b. The property is subject to donor’s tax at P800,000.
c. The property is subject to estate tax at P800,000.
d. The property is subject to estate tax at P1,000,000.

Mang Kiko transferred his property with fair value of 1,000,000 and the title to the property was
transferred immediately. It is subject to donor’s tax.

C 4. Assuming instead that legal title to the property was reserved by Mang Kiko until death, which is
CORRECT?
a. The property is subject to donor’s tax at P1,000,000.
b. The property is subject to donor’s tax at P800,000.
c. The property is subject to estate tax at P800,000.
d. The property is subject to estate tax at P1,000,000.

If Mang Kiko died and he reserved the legal title up until his death, it is subject to estate tax at 800,000

C 5. A resident citizen died, leaving the following properties at the point of his death:

Fair Value Acquisition Cost

House and Lot P 4,000,000 P 2,000,000
Car 800,000 1,200,000
01 Task Performance 1 *Property of STI
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Agricultural Land 2,100,000 500,000

What is the amount of the donation mortis causa?

a. P 0 b. P3,700,000 c. P6,900,000 d. P7,300,000

House and Lot 4,000,000 + Car 800,000 + Agricultural Land 2,100,000 = 6,900,000

01 Task Performance 1 *Property of STI

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For items 6-10. A donor transferred the following properties on a certain day:

Philippines Abroad
Cash P 400,000 P 0
Land 1,000,000
Car 3,000,000

D 6. Assuming the donor is a resident citizen, what is the amount of the donation inter-vivos? a.
P1,000,000 b. P1,400,000 c. P4,000,000 d. P4,400,000

Cash 400,000 + Land 1,000,000 +Car 3,000,000 = 4,400,000

D 7. Assuming the donor is a resident alien, what is the amount of the donation inter-vivos? a.
P1,000,000 b. P1,400,000 c. P4,000,000 d. P4,400,000

Cash 400,000 + Land 1,000,000 +Car 3,000,000 = 4,400,000

D 8. Assuming the donor is a non-resident citizen, what is the amount of the donation inter-vivos? a.
P1,000,000 b. P1,400,000 c. P4,000,000 d. P4,400,000

Cash 400,000 + Land 1,000,000 +Car 3,000,000 = 4,400,000

B 9. Assuming the donor is a non-resident alien, what is the amount of the donation inter-vivos? a.
P1,000,000 b. P1,400,000 c. P4,000,000 d. P4,400,000

Cash 400,000 + Land 1,000,000 = 1,400,000

A 10. Assuming the donor is a non-resident alien with a reciprocity exemption, what is the amount of the donation
inter-vivos?
a. P1,000,000 b. P1,400,000 c. P4,000,000 d. P4,400,000

Land 1,000,000 , Only the tangible property in the Philippines are subject to donor’s tax.

01 Task Performance 1 *Property of STI

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