St.

Paul University Surigao

St. Paul University System
8400 Surigao City, Philippines

NAME: Libay, Trisha Nel E.

COURSE & YEAR: BSA-201

1. What is the nature of donation? Explain.

ANSWER: The nature of donation in donors’ tax is that it is a voluntary contribution given by an
individual or organization to a charity, nonprofit, or other form of philanthropy that is tax
deductible. Donations can be in the form of cash, goods, or services.
Donations can take several forms depending on what is being donated. A donation is typically
defined as donating money, products, or services to an organization or someone without expecting
anything in return. People give donations for a variety of reasons, including supporting a cause,
sponsoring a project, or just assisting someone in need. It is important to note that many gifts are
tax deductible, offering a way to support causes and organizations.
Donor's tax is a tax on a donation or gift, and is imposed on the gratuitous transfer of property. It
shall apply whether the transfer is in trust or otherwise, whether the gift is direct or ind irect, and
whether the property is real or personal, tangible or intangible.

2. What is the effect of donations and limitations? Explain.

ANSWER: Donations and limits can have an impact on an organization or cause. Donations help
an organization achieve its goals. Furthermore, gifts can raise awareness of the organization,
leading to increased volunteerism and support. Limitations, on the other hand, serve a role in
ensuring that organizations run within their means and maintain stability. They also ensure
resource allocation. Allow enterprises to reach their objectives in a more efficient manner. Finally,
both donations and constraints help an organization achieve its goals.

3. Can donation be revoked or reduced? Explain.

ANSWER: According to Art. 764. The donation shall be revoked at the instance of the donor,
when the donee fails to comply with any of the conditions which the former imposed upon the
latter. So therefor Yes, donations can be revoked or reduced depending on the conditions of the
agreement between the donor and recipient. This could be due to a variety of factors, such as the
recipient failing to achieve the standards set in the donation's agreement or the donor deciding to
reduce or discontinue the donation for whatever reason. If a donor chooses to discontinue or reduce
their donation, they ought to first reach out to the receiver and negotiate the conditions of the
arrangement.
 St. Paul University Surigao
St. Paul University System
8400 Surigao City, Philippines

4. How is donors’ tax computed?

ANSWER:
Rate - The donor's tax for each calendar year shall be six percent (6%) computed on the basis of
the total gifts in excess of Two Hundred Fifty Thousand Pesos (P250,000) exempt gift made during
the calendar year.

5. What legal form is used in donation? Please prepare one.

ANSWER: The most common legal form used in donation is a Deed of Donation. It is a written
instrument that documents the gift of property from one person (the donor) to another (the donee).
The deed must be signed by both the donor and the donee, and it should be witnessed by two other
people.

DEED OF DONATION

KNOW ALL MEN BY THESE PRESENTS:

That the members of the ABC Corporation, of Espina Street, Purok Kalipayan,
Brgy. Taft, Surigao City, Surigao del Norte, Mindanao, 8400, represented by Trisha
Nel E. Libay, Chief Executive Officer, as an act of generosity, hereby donate the
herein identified items/materials to Brgy. Taft, through Kirstien Cate L. Escobia
Brgy. Captain of Brgy. Taft to be used solely for charitable purposes.

The donation shall consist of the following:

1000 sack of cement
10,000 pieces of Roofing Materials
1,000,000 Pesos

We further certify that this is a free gift and that there is to be no payment or
exchange of monetary value for the shipment of distribution of said merchandise.

Done on this 16th day of October 2023, in the office of the Chief executive officer.