Gross estate

Individuals

Transfer and Business Taxes

Mr. James Dane T. Adayo

Transfer taxes
 Estate Tax- transfer tax related to transfer upon death of the decede
nt (succession)
 Donors Tax- transfer tax related to transfer upon the lifetime of the d
onor
Two kinds of Transfers
 Gratuitous transfers- Act of liberality
 Onerous transfers- There is a reciprocity
What kind of tax is Estate tax?
 National tax- imposed by the National government
 Direct tax- Cannot be shifted from one person to another
 Ad Valorem tax- Gross estate is based on valuation
 Proportional tax- the tax rate is fixed
 General/Fiscal/Revenue tax- Imposed to raise revenue
 Excise tax- Tax on the right or privilege to transfer property from one
person to another
Elements of Succession Intestate

Testator Decedent

Estate

Executor Administrator

Heir Devisee
Legatee
General
Estate Tax Computation
  Exclusive Common Total
Gross Estate xxx xxx xxx
Less: Deductions (xxx) (xxx) (xxx)
Net estate before share of      
surviving spouse xxx xxx xxx
Less: Share of surviving spouse - (xxx) (xxx)
Net estate before special xxx xxx Xxx
deductions
Less: Special deductions      
Family home     (xxx)
Standard deduction     (xxx)
Taxable net estate     xxx
Tax due     xxx
Less: Estate tax credit     (xxx)
Tax payable     xxx
Estate Tax Computation
  Common Total
Exclusive
Gross Estate (Part I) xxx xxx xxx
Less: Deductions (Part II) (xxx) (xxx) (xxx)
Net estate before share of      
surviving spouse xxx xxx xxx
Less: Share of surviving spouse - (xxx) (xxx)
Net estate before special xxx xxx Xxx
deductions
Less: Special deductions      
Family home     (xxx)
Standard deduction     (xxx)
Taxable net estate (Part III)     xxx
Tax due     xxx
Less: Estate tax credit     (xxx)
Tax payable     xxx
Estate Tax Computation as a Simple Accounting Equation

(Part 1)Gross estate= Assets

(Part 2)Deductions= Liabilities
(Part 3)Net taxable estate= Equity
Gross estate

Properties owned at the time of death are included in the

gross estate.
Classification of decedents

1. Resident or citizen (RC, RA and NRC) – taxable in the

estate worldwide

2. Nonresident Alien (NRAETB and NRANETB)- taxable only

in the estate in the Philippines
What property we are referring to??

1. Real property or Immovable property

2. Personal property or Movable propery*

Movable property- Tangible or intangible

Succession is a mode of acquisition by virtue of which the property, rights
and obligations to the extent of the value of the inheritance, of a person are
transmitted through his death to another or others either by his will or by
operation of law
Types of succession
1. Testamentary- that which results from designation of an heir, made in
a will executed in the form prescribed by law.

2. Intestate- when a decedent dies without a will or with an invalid one.

3. Mixed succession- transmission of the decedent properties shall be

partly by the virtue of a written will and partly by operation of law.

Will- is an act whereby a person is permitted, with the formatlities

prescribed b the law, to control a certain degree in the disposition of his
estate to took effect upon death
Types of will
1. Holographic will- a will which is entirely written, dated and signed
by the hand of the testator himself.

2. Notarial will- a notarized will signed by the decedent and witnesses.

3. Codicil- a supplement or addition to a will, made after the

execution of a will.
Nature of succession
Succession is a gratuitous transmission of property from a deceased person
in favor of his successors. It is a donation caused by the death

Donation mortis causa- succession upon death. It is subject to estate tax.

Donation inter vivos- donation upon lifetime of the donor. It is subject to

donors tax
Elements of succession
1. Decedent- a person whose property is transmitted through succession.
Whether he left a will or not

2. Estate- the property, rights and obligations of the decedent not

extinguished by his death. This is also known as the inheritance.

3. Heirs- a person called to the succession either by the provision of a will

or by operation of law.
Types of compulsory heirs
1. Primary heirs- Legitimate/Illegitimate children and their direct
descendants

2. Secondary heirs- Legitimate/Illegitimate parents and ascendants

3. Concurring heirs- The surviving spouse and illegitimate ascendants

Definition of terms
1. Legitimate children- are those born out of a legal marriage

2. Direct descendants- refer to children or, in their absence, grandchildren

3. Legitimate parents- refer to biological parents

4. Illegitimate parents- are adopting parents to an adopted child

5. The surviving spouse is the widow or widower of the decedent.

6. Illegitimate descendants are illegitimate children.

Definition of terms
1. Legitimate children- are those born out of a legal marriage

2. Direct descendants- refer to children or, in their absence, grandchildren

3. Legitimate parents- refer to biological parents

4. Illegitimate parents- are adopting parents to an adopted child

5. The surviving spouse is the widow or widower of the decedent.

6. Illegitimate descendants are illegitimate children.

The secondary heirs shall inherit only in default of the primary heirs. Normally,
only the primary heirs and concurring heirs share in the hereditary estate.
In absence of the compulsory heirs, the following shall inherit in the
following order of priority:

A. Collateral relatives up to fifth degree of consanguinity

B. The Philippine Government (Escheat)

Priority is given to collateral relatives in the closest degree

C. GROSS ESTATE
-pertains to the totality of the properties owned by the decedent at the point of
his death.
1. Composition of Gross Estate
 Property Resident or citizen decedent Non-resident alien decedent
Real Properties Wherever situated Situated in the Philippines
Personal properties Wherever situated Situated in the Philippines
Family home Situated in the Philippines -0-
Taxable transfers Wherever situated Situated in the Philippines
2. Gross Estate of Married Decedents
  Conjugal partnership of gains Absolute community of properties
Exclusive properties of the Included Included
decedent
Exclusive properties of the Not included Not included
surviving spouse
Common properties Included Included
There are two concepts to be discussed under gross estate:

a. Exclusions in gross estate- those properties or transfers excluded

by law from taxation

b. Inclusions in gross estate- those properties which are to be included

as part of the taxable gross estate
Recap questions:
1. The donor in a mortis causa is:
a. Living
b. Dead
c. Either a or b
d. None of the above.

2. Succession in the absence of a will

a. Testamentary
b. Intestate
c. Mixed
d. None of these
Recap questions:
3. Which is not an element of succession?
a. Estate
b. Decedent
c. Heirs
d. Estate tax
The Gross Estate Formula
Inventory of properties at the point of death Pxx
Less: Exempt transfers
Properties not owned Pxx
Properties excluded by law xx xx
Inventory of taxable properties xx
Add: Taxable transfers xx
Gross estate xx
EXEMPTIONS/EXCLUSIONS
1. Exemptions of certain a. The merger of usufruct in the owner of the naked title;
acquisitions and b. The transmission or delivery of the inheritance or legacy by the
transmissions fiduciary heir or legatee to the fideicommissary;
c. The transmission from the first heir, legatee or done in favor of
another beneficiary in accordance with the desire of the
predecessor; and
d. All bequest, devises, legacies or transfers to social welfare, cultural
and charitable institutions, no part of the net income of which
inures to the benefit of any individual; Provided, however that not
more than 30% of the said bequest, devises, legacies or transfers
shall be used by such institutions for administration purposes.
2. Exclusions from gross a. Amount received as war damages;
estate under special laws b. Amount received from US Veterans Administration;
c. Benefits from GSIS and SSS.
Transfer of properties not owned by the decedent
a. Merger of the usufruct in the owner of naked title
Illustration:
Mr. A died on June 2019. In his will, he devised an agricultural
land to B who shall use the property over 10 years and thereafter to C.
Subsequently, B died resulting in the transmission of the property to C.

A B C
Current Owner of the
Predecessor
decedent naked title

The transfer of land from B to C is merger of the usufruct in the owner of the
naked title.
This does not constitute a donation mortis causa as it is a mere return of the
property to the real owner. Hence this shall be excluded from gross estate.
Transfer of properties not owned by the decedent
b. The transmission or delivery of the inheritance or legacy by the
fiduciary heir or legatee to the fideicommissary
Illustration:
Mr. A died leaving an inheritance consisting of several real estates to his
favorite grandson C. Because C is a minor, Mr. A appointed B, an older
brother of C, as fiduciart to the inheritance. Before transferring the property
to C, B died
A B C
Current
Predecessor Fideicomissary
decedent

The delivery of the inheritance upon death of B to C is not to be included in

the gross estate.
Transfer of properties not owned by the decedent
c. The transmission from the first heir, legatee or done in favor of
another beneficiary in accordance with the desire of the predecessor;
Illustration:
Mr. A devised on his will a piece of land to B as the first heir and thereafter
to C as the second heir. B subsequently died and transmitted the property to
C in accordance with Mr. A's will
A C
B Fideicommissary
Predecessor (1st heir)
(2nd heir)

The transfer of property from B to C is referred to as transfer under a special

power of appointment . The transfer from B to C is merely an implementation
of the transfer which was originally mandated by A.
TAXABLE TRANSFERS
1. Examples of Taxable a. Transfer in contemplation of death- motivated by thought of death
Transfer may not be imminent
b. Revocable transfer- the enjoyment of the property may be altered,
amended revoked or terminated by the decedent.
c. Transfer passing under general power of appointment
d. Transfer with retention or reservation of certain rights
e. Transfer for insufficient consideration
Taxable transfers
a. Transfer in contemplation of death-
Donations made by the decedent during his lifetime which are motivated by
the thought of death.
These transfer inter-vivos are usually made by the decedent under state of
terminal illness or under belief of an imminent death. Transfer in contemplation
of death are taxed in accordance with donation mortis causa subject to estate tax
not to donors tax.
Example:
a. Transfers of property to take effect after death of decedent
Taxable transfers
b. Revocable transfers-
involves transfer of possession over property during the lifetime of the decedent
but not transfer of ownership over the said property.
In revocable transfers, ownership transfers only when the transferor waives the
right to revoke the transfer. If the transferor dies without waiving his right of
revocation, he owns the property at the point of his death.
Taxable transfers
c. Transfer passing under general power of appointment-
Properties subject to a general power of appointment by the decedent shall be
included in the gross estate of the decedent. The presence of the general power
enables the holder of such power to do with the property anything which he
could do as if the property was his own.
Illustration:
Mr. X died. In his will, gave Mr. A house and lot with the right to designate the
property with whomever heir he wants. A eventually died and appointed B as heir
to the property.
It should be included in the gross estate of A since this is a general power of
appointment. If A had limited power, the house and lot should not be part of his
gross estate.
Taxable transfers
d. Transfer with retention or reservation of certain rights

e. Transfer for insufficient consideration

Taxable transfers made without consideration or less than consideration are
included in the gross estate at the fair value or difference of the transferred
property at the time of death
Taxable transfers
e. Transfer for Insufficient Consideration
Illustration:
Before death, Mrs. Power made the following Mortis Causa transfers during her
lifetime:
Amount
At the date of transfer Fair value included
Fair value Consideration At death in Gross Estate
To Alex 300,000 - 200,000 200,000
To Bee 200,000 195,000 300,000 -
To Ced 100,000 40,000 120,000 80,000
To Donrick 150,000 80,000 70,000 -
P5,000 difference is said to be adequate (Bee)
Sample problem: Transfer for Insufficient Consideration
When Freya was informed by her physician that she was about to die of
COVID20, she sold her properties
Market value Market value
Date of sale Selling price Date of death
Land 2,500,000 1,500,000 2,700,000
Jewelries 500,000 300,000 300,000
Shares of stock 200,000 220,000 250,000
Transfer under limited power 1,000,000 600,000 800,000
of appointment
From among the data given, how much should be included in the gross estate of Freya
upon her death?
Composition of gross estate
1. Properties, movable or immovable, tangible or intangible

2. Decedent's interest on properties

3. Proceeds of life insurance-

a. Designated as revocable to any heir
b. Regardless of designation, if the beneficiary is the estate, administrator
or executor

4. Taxable transfers
DETERMINATION OF THE VALUE OF THE ESTATE
1. Usufruct In accordance with the latest Basic Standard Mortality Table, to be approved by
the Secretary of Finance, upon the recommendation of the Insurance
Commissioner.
2. Properties a. Generally- Fair market value at the time of decedent’s death;
b. Real Property- Higher between fair market value, BIR (zonal value) and fair
market value, Provincial and City assessor (assessed value)
c. Personal Properties- Recently purchased- Purchase price
Not recently purchased- Pawn value x 3(if silent)
d. Securities (shares of stock)
1) Traded in the local stock exchange- Mean between the highest and lowest
quotations on valuation date or on a date nearest the valuation date;
Not traded in the local stock exchange-
a. Common (ordinary) shares- Book value, on valuation date or on a date nearest
the valuation date;
b. Preferred (preference) shares- Par value
Valuation of gross estate
Properties subject to estate tax shall be appraised at their fair value at the point
of death.

Valuation rules
1. The fair value of the property as of the time of death shall be the value to
include in the gross estate.
2. Fair value rules set by law must be followed
3. In default of such fair value rules, we can refer to generally accepted
accounting principles
Valuation rules
Real properties- Appraisal value shall be the higher between:
a. Zonal value determined by the Commissioner of Internal Revenue
b. Assessed value fixed by the Provincial or city Assessor
Valuation rules
Shares of stock- the fair market value of the stocks shall depend on whether the
stock are listed or unlisted in the stock exchange

a. Preferred shares- par value

b. Unlisted ordinary shares- book value
c. Listed shares- Mean between the highest and lowest quotations on valuation
date or on a date nearest the valuation date;
Exercises:
a. A decedent died leaving the following properties. Determine the gross estate:
  Resident or NRA- No NRA- With
citizen Reciprocit Reciprocity
y
House and lot, USA, FMV, time of death P1,000,000, cost      
P1,500,000
Condominium unit, Philippines, FMV, time of death, P1,500,000;      
assessed value, time of death, P2,000,000
Furniture and appliances, Philippines, FMV time of death, P500,000      
Car, USA, purchase price, P800,000; FMV time of death P700,000      
Bonds, Philippines, sold for P300,000, FMV, date of sale, P250,000,      
FMV, date of death, P350,000
Common shares of stock, foreign corporation, par value, time of      
death, P500,000; book value, time of death P600,000
Proceeds of life insurance, Philippines (administrator of the estate is      
the irrevocable beneficiary, P800,000)
Total      
Recap questions:
1. As a rule, all decedents are taxable on world estate except,
a. Non resident alien
b. Resident Citizen
c. Non resident citizen
d. Resident alien

2. Which is not an exclusion in gross estate?

a. Accruals from SSS
b. GSIS benefits
c. War damage payments
d. Private retirement benefits
Recap questions:
3. Which is not included in the gross estate?
a. Revocable transfers
b. Transfer in contemplation of death
c. Transfer under special power of appointment
d. all of the above
Problems: Gross estate
1. Ms. Ma. Katie Pero died bankrupt. She had the following properties and
obligations at the date of her death:
Cash P200,000
Agricultural land 3,000,000
Family home 2,000,000
Debts and obligation 8,000,000

Compute the gross estate of Miss Pero

Problems: Gross estate
2. Angela, Filipina, died in United States with the following properties:
Condominium unit in New York, Cubao P5,000,000
Shares of stock in a foreign corporation 600,000
Interest in a partnership, domestic 475,000
Bank deposit in a New York City Bank 150,000
Car in Cebu, donated inter vivos 5 years ago to her son 500,000

1. If the decedent was a non resident alien (with reciprocity), how much is
the gross estate?

2. If the decedent was a non resident alien (no reciprocity), how much is the
gross estate?
Problems: Gross estate
3. Based on the following data, how much is the value of the decedents interest if
he died on March 31, 2018?
Cash in bank P254,000
Interest on bank deposit (Jan. 1 to June 30, 2015) 9,000
Dividends from a domestic corporation 60,000
Date of declaration- February 5, 2018
Date of record- April 15, 2018
Date of payment- May 15, 2018
Share in 2018 net profit of partnership, distributed to partners on April 15 9,000
Winnings in lotto (Bet March 30, 2018, April 1, 2018 draw) 500,000
Problems: Gross estate
4. Aldous,Filipino died in the United States with the following properties:
Condominium unit in New York City 2,000,000
Shares of stock in a foreign corporation 600,000
Interest in a partnership, domestic 475,000
Bank deposit in a New York City bank 150,000
Car in Cebu, donated intervivos 5 years ago to her son 500,000
Which property should be included in the gross estate?
a. All of the above properties
b. Only the properties located in the Philippines
c. All of the above properties except the car
d. The properties located in the Philippines except the intangibles

5. If the decedent was a non resident alien (with reciprocity) how much is
the gross estate?
Problems: Gross estate
4. Aldous,Filipino died in the United States with the following properties:
Condominium unit in New York City 2,000,000
Shares of stock in a foreign corporation 600,000
Interest in a partnership, domestic 475,000
Bank deposit in a New York City bank 150,000
Car in Cebu, donated intervivos 5 years ago to her son 500,000

Which property should be included in the gross estate?

a. All of the above properties
b. Only the properties located in the Philippines
c. All of the above properties except the car
d. The properties located in the Philippines except the intangibles
Taxable transfers
Illustration:
Before death, Mrs. Power made the following Mortis Causa transfers during her
lifetime:
Amount
At the date of transfer Fair value included
Fair value Consideration At death in Gross Estate
To Alex 300,000 - 200,000 200,000
To Bee 200,000 195,000 300,000 -
To Ced 100,000 40,000 120,000 80,000
To Donrick 150,000 80,000 70,000 -

P5,000 difference is said to be adequate (Bee)

RULE OF RECIPROCITY (NON RESIDENT ALIEN
DECEDENT)
1. Properties covered Intangible personal property situated in the Philippines owned by
by reciprocity non-resident alien decedent.
2. Basic rules When there is reciprocity- The intangible personal property of
non-resident alien situated in the Philippines are not included in
the gross estate.
 
When there is reciprocity- The intangible personal property on
non-resident alien situated in the Philippines are included in the
gross estate.
RULE OF RECIPROCITY (NON RESIDENT ALIEN
DECEDENT)
3. Properties considered
situated in the Philippines
The following shall be considered as situated in the Philippines
(among others):
a. Franchise which must be exercised in the Philippines.
b. Shares, obligations or bonds issued by any Corporation or
sociedad anonima organized and constituted in the Philippines in
accordance with its law;
c. Shares, obligations or bonds issued by any foreign corporation
85% of the business of which is located in the Philippines.
d. Shares, obligations or bonds issued by any foreign corporation
if such shares, obligations or bonds have acquired a business
situs in the Philippines.
c. Shares or rights in any partnership, business or industry
established in the Philippines.
OTHER ITEMS
1. Proceeds of life
insurance
2. Claims against insolvent
persons
3. Amount received by heirs
under R.A No. 4917
Generally taxable, except when:
a. A third person is irrevocably designated as beneficiary
b. The proceeds/benefits come from GSIS or SSS
c. The proceeds come from group insurance
When the designation of the beneficiary is not stated or is not clear, the
Insurance Code assumes revocable designation.
a. The full amount of the claims is included in the gross estate
b. The uncollectible amount of the claims is deducted from the gross
estate.
a. R.A No. 4917 is entitled ‘An Act Providing Retirement Benefits of
Employees of Private Firms Shall Not be Subject to Attachment, Levy,
Execution, or Any Tax Whatsoever,
b. The amount received by heirs from the decedent’s employer as a
consequence of death of the decedent-employee is included in the gross
estate of the decedent
c. The amount above is also allowed as deduction from gross estate.
 Gross Estate
For Married Decedents
The gross estate of a married decedent is composed of:
1. The decedent’s exclusive properties
2. The common properties of the spouses

The gross estate of a decedent(married) is reported as follows in the

estate tax return:
Exclusive Conjugal/Common Total
Gross estate xxx xxx xxx
Less: Deductions
Property relations between spouses
For married decedents, the boundary between separate properties and
common properties of the spouses is important in the determination of
the gross estate of the decedent spouse.

What is a separate or common property?

Under the Family Code, the property relation between the spouses must
be agreed upon by spouses before their marriage. The same is set in
their Pre-Nuptial Agreement.
Common types of Property Regimes
1. Absolute separation of property- (ASP) Technically, all properties of the
spouses are separate properties, except those properties which they may acquire
jointly.

2. Conjugal partnership of gains- (CPG) All properties that accrues as fruit of

their individual or joint labor or fruits of their properties during the marriage will
be common properties of the spouses.

3. Absolute community of property(ACP)- all present properties owned by the

spouses at the date of celebration of the marriage shall become common
properties of the spouses including future fruit of their separate or joint
industryor fruits of their common properties
Conjugal partnership of gains xxx Absolute Community Property

August 3, 1988
Conjugal partnership of gains
The properties of the spouses including fruits before the marriage are their
exclusive properties.
Conjugal partnership of gains views marriage as a union of gains that accrues
during the marriage. This is best described as a marriage settlement which is
“prospective”.

xxx Prospective Before marriage Date of marriage

Examples of fruits during the marriage

1. Salary, profits or gains of labor or
2. Income of properties acquired by the spouses during the marriage
3. Income of separate properties of either husband and wife
Exceptions to Prospectivity under Conjugal partnership of gains:
1. Acquisition by gratuitous title- properties received by the spouses by way of
donation or inheritance during marriage are separate properties of the recipient
spouse, unless the donor or the decedent, as the case may be, designated the transfer
for both spouses.
2. Properties acquired using exclusive money of either spouse.
Logic: because these properties are not fruits of labor or fruits of conjugal properties.
Absolute Community of Properties (ACP
1. Under ACP, marriage is viewed as a union of the present property of the spouses
including fruits of labor and industries of the spouses during the marriage.

Retrospective xxx Prospective

Date of marriage
Special features of ACP
1. Retrospective feature
Properties brought into the marriage will become common properties. All properties of
the spouses present at the date of celebration of the marriage which they acquired
before marriage will become common properties.

2. Prospective feature
All properties which the spouses may acquire during the marriage from their separate
properties or joint labor or industry shall be common.
Exclusive properties
Under ACP all properties are effectively common with the exception of the
following which the law designated as exclusive properties of the spouses:

1. Properties received by way of gratuitous title during or after the marriage

(Exception to prospectivity)

2. Fruits of exclusive properties of the spouses during or after the marriage

(Exception to prospectivity)

3. Properties for the exclusive personal use of either of the spouses, except jewelry
(Exception to both prospectivity and retrospectivity)

4. Properties brought into the marriage by either spouse with a descendant by a

prior marriage (Exception to retrospectivity)
Exclusive properties
• Same as CPG, properties received by way of donation or succession during the
marriage is a separate property unless designated by the donor or decedent to
be for both spouses.

• Fruits of an exclusive property is an exclusive property. It follows therefore that

the fruit of a common property is a common property. In short, “fruit follows the
principal”.

• Jewelries is a common property regardless if when earned or taken by either

spouses. Jewelries acquired by way of gratuitous title is still exclusive.

•Properties accumulated before the marriage by a spouse with descendants in a

prior marriage are reserved by the law as separate property
GROSS ESTATE OF MARRIED DECEDENTS
Exclusive properties
a. Properties brought into the
marriage as either of the spouse’s own
b. Properties acquired by gratuitous
(or lucrative) title during the marriage
c. Properties acquired by right of
redemption or by exchange with other
property belonging to only one of the
spouses;
d. Properties acquired with exclusive
money of either spouse.
 
 
 
Conjugal Properties
a. Properties acquired by onerous title during the marriage at the
expense of the common fund, whether the acquisition be for the
partnership, or for only one of the spouses;
b. Properties obtained from labor, industry, work or profession of
either or both of the spouses;
c. The fruits, natural, industrial or civil, due or received during the
marriage from the common property, as well as the net fruits from
the
exclusive property of each spouse;
d. The share of either spouse in the hidden treasure which the law
awards to the finder or owner of the property where the treasure is
found
e. Properties acquired through occupation such as fishing and
hunting;
f. Livestock existing upon the dissolution of the partnership in excess
of the number of each kind brought to the marriage by either spouse
g. Properties acquired by chance, such as winnings from gambling
and betting.
ABSOLUTE COMMUNITY OF PROPERTIES
Exclusive Properties Community Property
a. Properties acquired during the marriage by a. All properties owned by the spouses at the
gratuitous (or lucrative) title by either spouse, and time of the celebration of marriage or acquired
the fruits,as well as the income thereof, if any, thereafter.
unless it is specifically provided by the donor,
testator or grantor that they shall form part of the
community;
 
b. Property for personal and exclusive use of
either spouse, however, jewelry shall form part of
the community property; (but not jewelry
inherited)
 
c. Property acquired before the marriage by either
spouse who has legitimate descendants by a
former marriage, and the fruits as well as the
income, if any, of such property.
Exercises:
The decedent was married at the time of death. He was survived by his wife and children. The following
were presented to you and you were asked to compute the 1) exclusive and conjugal properties under
conjugal partnership of gains and 2) exclusive and community properties under absolute community of
properties.
    EXCL- CONJ- EXCL- COMM-
CPG CPG ACP ACP
Cash owned by the decedent before marriage P 5,000,000        
Real property inherited by the decedent during the 6,000,000        
marriage.
Personal property received by the wife as gift before 400,000        
the marriage
Property acquired by decedent with cash owned 600,000        
before the marriage
Clothes of the decedent purchased with the exclusive 500,000        
money of the wife
Jewelry purchased with cash of the surviving spouse 1,000,000        
Property unidentified when and by whom acquired 1,200,000        
Cash representing income during the marriage 2,000,000        
Total          
Illustration No. 1 (CPG)
Before their marriage on November 31, 1986, Mr. Zilong and Ms. Nana had
properties ofP1,000,000 car and P2,000,000 residential lot, respectively. Zilong and Nana married
without an agreed property regime.

During their marriage, Zilong and Nana acquired properties totaling P500,000 and P800,000,
respectively from their separate labor. Nana also sold her residential lot for P5,000,000 and
invested the entire proceeds in stocks.
Property Zilong (Husband) Nana (Wife) Common
Car 1,000,000    
Stocks   2,000,000 3,000,000
Fruits of labor     1,300,000
Total 1,000,000 2,000,000 4,300,000
Illustration No. 2 (ACP)
Mr. Oh died. An inventory of the properties of Mr. and Ms. Oh is prepared below:
  Mr. Oh Ms. Oh Total
Properties accruing before marriage      
Properties inherited before marriage 200,000 100,000 300,000
Other properties brought into marriage 400,000 500,000 900,000
Properties accruing during marriage      
Properties inherited during marriage 250,000 150,000 400,000
Properties as fruit of own labor 140,000 160,000 300,000
Properties as fruit of common labor     250,000
Fruits of properties inherited before marriage 100,000 50,000 150,000
Fruits of properties inherited during marriage 20,000 80,000 100,000
Fruits of properties acquired from own labor 20,000 40,000 60,000
Fruits of properties earned from common labor     50,000
The decedent was married at the time of death. He was survived by his wife and children. The following
were presented to you and you were asked to compute the 1) exclusive and conjugal properties under
conjugal partnership of gains and 2) exclusive and community properties under absolute community of
properties.

    EXCL- CONJ- EXCL- COMM-

CPG CPG ACP ACP
Cash owned by the decedent before marriage P 5,000,000        
Real property inherited by the decedent during the 6,000,000        
marriage.
Personal property received by the wife as gift before 400,000        
the marriage
Property acquired by decedent with cash owned before 600,000        
the marriage
Clothes of the decedent purchased with the exclusive 500,000        
money of the wife
Jewelry purchased with cash of the surviving spouse 1,000,000        
Property unidentified when and by whom acquired 1,200,000        
Cash representing income during the marriage 2,000,000        
Total          
Cardo died? leaving the following properties:
a. Real property in Baguio City, brought into marriage 300,000 Compute for:
b. Income of real property in Baguio 60,000 1. Under CGP:
c. Real property in Cebu City, brought into marriage by Alyana his wife 240,000 a. Exclusive and conjugal
properties of both spouses
d. Income of real property in Cebu 25,000
e. House in Pili Camarines Sur, acquired by Cardo during marriage 375,000 2. Under ACP:
f. Income of house in Pili 50,000 b. Exclusive and common
g. Real property in Iloilo City, earned by wife during the marriage 225,000 properties of both spouses
h. Income of real property in Iloilo City 80,000
i. Tangible personal properties in Manila, inherited by Cardo
during the marriage 500,000
j. Income of properties in Manila 175,000
k. Intangible personal properties in Singapore, inherited by Alyana
during marriage 430,000
l. Income of intangibles in Singapore 85,000
m. Tangible personal property in Dagupan City, inherited by Cardo
before the marriage 20,000
n. Income of property in Dagupan City 10,000
o. Intangible personal property in Canada, inherited by Alyana before
marriage 350,000
p. Income of personal property in Canada 85,000
 THANK YOU
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GOD BLESS!