QUESTIONS donor’s tax
A one day rent free use of another’s property is
Determine whether or not the following is a valid
donation:
1. Husband donated 10M to his wife on occasion of her
birthday
- Not Valid (To be valid, it must be moderate
and during family occasions. 10M is not moderate)
2. A Husband donated a watch worth 1,000 to his wife
because of her birthday.
- Valid
3. Donee signified his acceptance of donated property
known to the donor before he died, delivery of donated
property was made after the transferor died.
- Valid
4. Donee signified his acceptance of donated property
after the donor died, delivery of donated property was
made after the transferor died.
- Not Valid (dapat ma-signify yung acceptance
habang buhay pa yung donor)
5. Taxpayer donated to campaign fund of a candidate,
duly reported to COMELEC
- Not valid ??
6. Surviving spouse renounced his share in conjugal
partnership in favor of the heirs of the deceased
spouse.
- Valid
7. Surviving spouse renounced his share in hereditary
estate left by decedent in favor of the heirs of the
deceased spouse (in favor of no one in particular).
- Not Valid (must be in favor of particular year)
8. Donation /gift made by a 16-year-old boy to his
girlfriend.
- Not Valid (no capacity)
9. A promise of a boy to his girlfriend to make a gift/
donation worth 1M after 3 years.
- Not Valid (must be a present property)
10. Donation of a land worth 5,000, made in private
instrument.
- Not Valid (real property must be public
regardless of the amount.
11. Donation corporation to heirs of deceased officer
out of gratitude for past services.
- Valid
Questions:
Q1. A donor’s tax is imposed on the transfer of
property (not on the property itself. Thus, donor ‘s tax is
an
- d. Excise tax
Q2. I.
subject to donor’s tax, provided, the value of free rent
exceeded 250,000. (no transfer of property)
Il. An agreement to donate future property made in
public instrument is subject to donor's tax.
- b. FF
Q3. BIR was informed by X that a valid donation took
place between A and B worth 1M in year 2020; whereby
A transferred property to B. BIR can collect donor’s tax
amounting to? (6% in excess of 250k; (1m-
250k=750k*6%=45k)
- d. None of the above
- 6% in excess of 250k
- 1m-250k=750k*6%=45k
- collected from the donor
- Answer: 45,000 from A
Questions:
In Jan 1, 2020, X, who lives in Manila, donated a car
located in Marawi worth 500,000 to Y, with right to
revoke it. Donor delivered the car on Jan 10, 2020. On
February 5, 2020, X relinquished the right to revoke.
Q1. The donation was consummated on?
- Feb 5, 2020 (hindi pwedeng jan 10/date of
deliver kasi subject to revocation pa din)
Q2. When is the last day for filing of donor’s tax return?
- March 6, 2020 (30 days)
Q3. BIR form to be used?
- BIR form 1800
Q4. Last day of payment?
- March 6, 2020
QS. Donor’s tax due?
- 15,000
- (500k-250k)*6%
Q6. Who will file?
- X (the donor)
Q7. Can X and Y make an agreement that Y should pay
the donors tax? Is it binding to the Government?
- yes, however, it is not binding to the
government. (Donor’s tax is a direct tax and
same time the govt is not a party in the
agreement)
Q8. Where to file?
- within the domicile of the donor, BIR - Manila
Q9. What if X is a nonresident, where should he file the
DT return?
- Philippine embassy or Consulate
Penalty/additions to the basic assessed or deficiency - 30,600
tax - (760k-250k)*6%
Interest of 20% per annum – Old law 2. Donation was made in 2017, donated to a relative
Interest of 12% per annum – New law - Old law relative
- 29,000
Illustration: - 14,000 + ((760K-500K)*6%)
In 2016; Correct tax due is P 150,000 while the Payment 3. Donation was made in 2017, donated to a stranger
of tax made is P 100,000 only. The unpaid tax is overdue - Old law stranger
for 3 months. Assuming there is no fraud nor willful - 228,000
neglect to file and pay the correct tax due. - 760,000 * 30%

- Delinquent tax is 50,000 (150,000 less Illustration:

100,000) Asta, donated the following properties on April 9:
- Surcharge 25% of P 50,000 or 12,500 (failure Property Amount Allowed deduction
to pay tax due on required date) Property gift in 650,000 154,000
- Interest is 20% of 50,000 for 3 months OR phil
2,500 (50,000 x .2 x 3/12) Property gift 300,000 45,000
- Total amount due per BIR demand will be: abroad
65,000 (50,000+12,500+2,500) On the same calendar year, dated July 25, Asta donated
again the following properties
*Use 50% surcharge when there is fraud or willful Property Amount Allowed deduction
neglect to file and pay the tax due. Property gift in 100,000 30,000
**Use 12% rate per annum starting Jan 1, 2018 and so phil
on. Property gift 100,000 40,000
abroad
Question: What is the donor’s tax still due in July 25
Computation of donor’s tax
when:
Gross Gift
1. Asta, donor, is a non-resident citizen and donees are
Less: Allowed deductions (exemptions)
his relatives. Assuming that donation was
Taxable net gift
perfected/completed on 2016. (old law)
Add: total prior net gift
Donor's tax due on April 9, 2016
Total Net gift subject to donor’s tax
Gross Gift (650k+300k) 950,000
Donor’s tax due
Less: Allowed deductions
Less: Tax credits (exemptions) 154k+45k 199,000
Donor’s tax still due/payable Taxable net gift 751,000
Excess of 500,000 (from table) 251,000
Old law tax percentage (from table) 6%
- Relative (table); Stranger (30%) additional tax (from table) 14,000
Donor's tax due 29,060
Donor's tax due on April 9, 2016
Gross Gift (100k+100k) 200,000
Less: Allowed deductions
(exemptions) 40k+30k 70,000
New law Jan. 1, 2018 (RA No. 10963 - TRAIN law)
Taxable net gift 130,000
- 6% in excess of 250,000 Add: total prior net gift 751,000
Total Net gift subject to donor’s
Illustration: tax 881,000
X donated a property located in the Philippines with fair Excess of 500,000 (from table) 381,000
value of Php 760,000. Compute the donor’s tax due tax percentage (from table) 6%
when: additional tax (from table) 14,000
1. Donation was made on 2022 Donor's
- tax due 36,860
Less: Tax credits 29,060
- Train law
Donor’s tax still due/payable 7,800
2. Asta, donor, is a non-resident citizen and donees are made in Philippines, with Z as donee. Assuming there is
his relatives. Assuming that donation was NO reciprocity agreement between Phil and Japan.
perfected/completed on 2019. (new law) What is the donor’s tax due?
Donor's tax due on April 9, 2019 -0
Gross Gift (650k+300k) 950,000
Less: Allowed deductions Q3. In 2020, X, Japanese, living in Philippines, donated
(exemptions) 154k+45k 199,000 shares of MCDO Corporation, established under Japan
Taxable net gift 751,000 law, worth 1M. The related documents for donation
excess of 250,000 (TRAIN law) 501,000 was made in ITALY, with Z as donee. Assuming there is
tax percentage (TRAIN law) 6% reciprocity agreement between Phil and Japan. What is
Donor's tax due 30,060 the donor’s tax due?
Donor's tax due on April 9, 2019 - 45,000
Gross Gift (100k+100k) 200,000 - (1m-250k)*6%
Less: Allowed deductions
(exemptions) 40k+30k 70,000 Donor’s tax on married couple (valid or not valid)
Taxable net gift 130,000 Donation within spouses (married partner) – not valid
Add: total prior net gift 751,000 If nagdonate ng conjugal property dapat may consent
Total Net gift subject to donor’s Exemptions: (kahit isa lang)
tax 881,000 - Exclusive property
excess of 250,000 (TRAIN law) 631,000 - Charity event
tax percentage (TRAIN law) 6% - moderate family rejoicing
Donor's tax due 37,860
Less: Tax credits 30,060 Questions: (Donor’s tax on married couple)
Donor’s tax still due/payable 7,800 Determine if the following donations are valid or not:
1. Husband donated conjugal property with consent of
Resident alien is taxable within or without B wife to charity event, at a moderate amount.
NRA is taxable only if within - VALID
Requisites if subject to donor’s tax: (all must be present) 2. Husband donated conjugal property without consent
NRA of wife to charity event, at a moderate amount.
Intangible asset - VALID
Located within 3. Husband donated his exclusive property without
There is no reciprocity consent of wife to a friend.
- VALID
If domestic corporation – always within 4. Husband donated conjugal property without consent
If foreign corporation – without of wife to legitimate daughter for her birthday;
moderate amount.
Questions: (NRA) - VALID
Q1. In 2020, X, Japanese, living in Japan, donated shares 5. Husband donated a conjugal property, only the
of MCDO Corporation, established under Philippine law, Husband signed the deed of donation
worth 1M. The related documents for donation was - VALID
made in ITALY, with Z as donee. Assuming there is 6. Husband donated 10M to his wife, for her birthday.
reciprocity agreement between Phil and Japan. What is - NOT VALID – not moderate
the donor’s tax due? 7. Husband donated a conjugal property with consent of
-0 wife to take effect after death.
- didn’t meet all requisites. - NOT VALID – subject to estate tax

Q2. In 2020, X, Japanese, living in Japan, donated shares

of MCDO Corporation, established under foreign law,
worth 1M. The related documents for donation was
Mr and Mrs Galla, spouses and citizens of the Q4. Donations made by Foreign Corporations not
Philippines, donated to their legitimate daughter the subject to Donor ‘s tax, being a foreign entity with all
following properties in 2019: asset located outside the Philippines.
Vacation House (conjugal property- Hong Kong) - false
1,500,000;
Car (conjugal property)- Phil 750,000 Q5. Donor’s tax is imposed to prevent avoidance of
Jewelry (exclusive property of Mrs.Galla) income tax.
475,000 - false
Assuming no allowed deductions Avoidance of estate tax as a general rule
Q6. Donor’s tax due shall be paid on the date the gift
What is the TOTAL donor’s tax due of the spouses? was made.
Conjugal property - false
Gross Gift (1.5M+750k) 2,250,000 Donor’s tax due shall be paid 30 days after the date the
Less: Allowed deductions gift was made
(exemptions) 154k+45k - Q7. The donation of movable property may be made
Taxable net gift 2,250,000 only in writing.
excess of 250,000 (TRAIN law) 2,000,000 - false
tax percentage (TRAIN law) 6% It can be oral but must be simultaneously liberate
Donor's tax due 120,000 Q8. Gifts, donations, and other contributions received
Exclusive property - mrs. galla by the Homeowners’ Associations (Associations) are
Gross Gift 475,000 subject to the payment of donor’s tax pursuant to
Less: Allowed deductions Section 98, and 99 of the NIRC, as amended
(exemptions) 154k+45k - - true
Taxable net gift 475,000
excess of 250,000 (TRAIN law) 225,000 Q9. Husband and wife are considered as joint taxpayers
tax percentage (TRAIN law) 6% for purposes of donor’s tax.
Donor's tax due 13,500 - false
Total donor's tax due of the spouses Still considered as separate taxpayers
Conjugal property 120,000 Q10. The gross gift of donor who is alien, whether
Exclusive property - mrs. galla 13,500 resident or nonresident of Phil, includes all properties
Total donor's tax due 133,500 wherever situated.
- false
Questions: (true or false)
Q1. Splitting of gift is a tax minimization scheme which Questions: (gross gift)
is done by spreading the gift over numerous dates Q1. IN general, all real properly transferred during
within the calendar year period to avail lower lifetime of donor for less than adequate and full
tax liability. consideration in money, then the amount by which the
- false value of properly exceeds the value consideration shall
Para magkaroon ng splitting of gift, dapat different year be deemed gilt, subject to donor’s tax.
Q2. The consummation of the donation is the date - FALSE. Not all REAL properly
when the donee accepted the donation from the donor.
- false 2. A lot used in business, when transferred for less than
The consummation of the donation is the date when the adequate and full consideration, any difference
donor knows the acceptance between FV and consideration received, shall be
Q3. Oral Donation of personal property worth 5,000 or deemed gift
less is valid, provided that there must be simultaneous - TRUE
delivery of the thing donated.
- true Q3. A personal property transferred for less than
adequate and full consideration, any difference
 Questions: (gross gift)
between FV and consideration received, shall be X, RC, made the following transfers in 2020:
deemed gift, fmv at time of consideration
property
transfer received
- TRUE
equipment for business use 800,000 200,000
computers 500,000 700,000
Q4. A commercial land was transferred for less than red car sold (bona fide at arm's
1,000,000 100,000
adequate and full consideration, the property transfer length)
represents a bona fide sale, arm’s length transactions. machineries sold by machine
dealer - at arms length 600,000 500,000
Thus, subject to donor’s tax for the difference between
transactions
IV and consideration received. land (used for commercial
1,000,000 300,000
- FALSE purposes)
residential house and lot 900,000 200,000
Q4.1 A commercial land was transferred for less than blue car (revocable transfer) 300,000 -
land (title transfer after death) 700,000 -
adequate and full consideration, Thus, Subject to
donor’s tax for the difference between FV and Q1. What is the gross gift?
yes equipment for business use
consideration received
no fv<consi computers
- TRUE red car sold (bona fide at arm's
no -arms legth
length)
Q5. X, engaged in business, sold some furniture to a machineries sold by machine
small business owner for 500,000, where the FV is no -arms legth dealer - at arms length
600,000, The sale was made at arm’s length transaction, transactions
The difference of 100,000 is subject to donor’s tax. land (used for commercial
yes
purposes)
- FALSE. sale, exchange, or other transier of
no - cgt residential house and lot
properly made in the ordinary purse of busines nsaction no - estate tax blue car (revocable transfer)
which is bona fide, at arm’s length, and free from any no - estate tax land (title transfer after death)
donative intent).
Gross gift = fv less consideration

Q6. X, engaged in business, sold some furniture to a 800,000 - 200,000 = 600,000

small business owner for 600,000, where the
FV is 500,000. The sale was not made at arm’s length 1,000,000 - 300,000 = 700,000
transaction. The difference of 100,000 is subject to
donor's tax. gross gift = 1,300,000
- FALSE. NO Fxcess= FV over the Consideration.
Dapat mas mataas yung FV Q2. What is the donor’s tax due?
Donor's tax due
Gross Gift (600k+700k) 1,300,000
Less: Allowed deductions
(exemptions) 154k+45k -
Taxable net gift 1,300,000
excess of 250,000 (TRAIN law) 1,050,000
tax percentage (TRAIN law) 6%
Donor's tax due 63,000
Questions: (allowed deductions)