EXERCISE 13–1. WORD SEARCH
1. Thirty
2. Net gift
3. DSWD
4. PCNC
5. IBP

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EXERCISES 13-2
1.

The Revenue District Officer is not correct. Since the donations were made in a

different year, the computation of the tax on each donation must be done separately.
The donor has the prerogative to choose the date in which he would want to donate
his properties.

2.

On the assumption that the requisites for a valid donation were complied, the donor's
tax due is P2,000 because the visitor is a father of Bilanggo.

3.

a. No because the giving of the gift check took place outside the Philippines. This is
evident from the fact that the check was sent and not given by Gandhi in the
Philippines.
b. The gift is taxable in the Philippines because there is no reciprocity between
Philippines and India.

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c. No. Nonresident aliens are not allowed to claim the exemption of P10,000.

EXERCISES 13-3. PROBLEMS
1.

2.

a. Tax on P 90,000

Exempt


b. Tax on P 100,000

Exempt

c. Tax on P 100,000
80,000 x 2%

P

Exempt
1,600

d. Tax on P 3,000,000

P 204,000

e. Tax on P 5,000,000
1,500,000 x 12%
Gift tax

P 404,000
180,000
584,000

f. Tax on P 10,000,000
1,200,000 x 15%
Gift tax

P1,004,000

180,000
1,184,000

Donation – May 17, 2008
Mr. Amigo
To Barat (370,000 x 1/2)
Barat

185,000
125,00
0
310,000
10,000
300,000

Gross gift
Less: Exemptions
Net gift
Tax on P200,000
100,000 x 4%
Gift tax

Mrs.
Amigo
P 185,000

10,000
175,000

P 2,000

4,000
6,000

Tax on P100,000
75,000 x 2%

Exempt
P 1,500

Donation – June 12, 2008

Mr. Amigo Mrs. Amigo

To Constantino
Barat (600,000/2)
Gross gift
Less: Deductions
Unpaid mortgage (40,000/2)
Unpaid taxes (8,000/2)
Total deductions
Net gift

300,000
300,000
20,000
4,000
24,000
276,000

Add: Net gift, May 17

Total

300,000
576,000

Tax on P 500,000
76,000 x 6%

14,000
4,560

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100,000
300,000
400,000
20,000
4,000
24,000
376,00
0
175,000
551,000


Gift tax on total
Less: Tax paid, May 17
Gift tax due

18,560

6,000
12,560

Tax paid on P500,000
51,000 x 6%
Gift tax on total
Less: Tax paid, May 17
Gift tax due
3.

14,000
3,060
17,060
1,500
15,560

Donation – March 20, 2008
Gross gift

P
300,000
- .
300,00
0

Less: Deductions
Net gift
Tax on P 200,000
100,000 x 4%
Gift tax due


P 2,000
4,000
6,000

Donation – July 20, 2008
Gross gift

P300,00
0
.
300,00
0
300,00
0
600,00
0

Less: Deductions
Net gift
Add: Net gift, March 20
Total
Tax on P 500,000
100,000 x 6%
Tax on total
Less: Tax paid, March 20
Gift tax due

P14,000
6,000

20,000
6,000
14,000

Donation – November 20, 2009
Gross gift

P300,00
0
.
300,00
0

Less: Deductions
Net gift
Tax on P 200,000
100,000 x 4%
Gift tax due
4.

P 2,000
4,000
6,000

Donor – Asada
Donation – April 25
Gross gift

P150,00


47


0
10,00
0
140,00
0

Less: Deductions
Net gift
Tax on P 100,000
40,000 x 2%

Exempt
P 800

Donor – Asada
Donation – May 9
Gross gift

P
75,000
- .
75,00
0
140,00
0
215,00
0


Less: Deductions/Exemptions
Net gift
Add: Net gift, April 25
Total
Tax on P 200,000
15,000 x 4%
Tax on total
Less: Tax paid, April 25
Gift tax due

P 2,000
600
2,600
800
1,800

Donor – Asada
Donation – July 30, 2002
To Paco

P400,00
0
75,00
0
475,00
0

Ramon Magsaysay Foundation
Gross gift

Less: Deductions/Exemptions
To Paco
Ramon Magsaysay

P10,000
75,000

Net gift
Tax on P 200,000
190,000 x 4%
Gift tax
Less: Tax paid
April 25
May 9

P 2,000
7,600
9,600
P
800
1,800

Gift tax due
5.

85,00
0
390,00
0


2,60
0
7,000

March 20, 2008
Gross gift

P325,000

48


Less: Exemptions
Net gift

.
325,000

Tax on P 200,000
125,000 x 4%
Gift tax

P 2,000
5,000
7,000

May 20, 2008
Gross gift
Less: Deductions/Exemptions
Net gift

Add: Net gift, March 20
Total

P500,000
.
500,000
325,000
825,000

Tax on P 500,000
325,000 x 6%
Tax on total
Less: Tax paid, March 20
Gift tax due

P14,000
19,500
33,500
7,000
26,500

Donation – June 5, 2008
Gross gift
Rate
Gift tax due

P 88,000
30%
26,400


Donation – July 29, 2008
Gross gift
Rate
Gift tax due
6.

P 25,000
30%
7,500

Assumption A:
a. The rule on transfer for insufficient consideration applies only when the following
requisites are present:

1. The market value is higher that the selling price; and
2. The property is not a real property and a capital asset.
Thus, even is the sale was made for an insufficient consideration no
donor’s tax is due because the property subject of sale is a real property-capital
asset.
b. Market value (higher than selling
price)
Capital gains tax rate
Capital gains tax

1,600,000
6%
96,000

Assumption B:
a. Fair market value

Less: Selling price
Deemed gift
Rate of tax (stranger)
Donor’s tax due

1,600,000
1,000,000
600,000
30%
180,000

b. Selling price

1,000,000

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7.

Less: Cost
Acquisition cost
400,000
Commission
50,000
Taxes and other fees
25,000
Capital gain on sale (long-term)

475,000

525,000

Income subject to tax (525,000 x 50%)

262,500

Donation – February 14
Gross gift

P
700,000
.
700,000

Less: Exemption
Net gift
Tax on P 500,000
200,000 x 6%
Gift tax

P 14,000
12,000
26,000

Donation – July 14
Gross gift

P
250,000
.

250,000
30%
75,000

Less: Exemptions/Deductions
Net gift
Rate of tax
Gift tax
Donation – November 14
Gross gift

P
150,000
.
150,000
700,000
850,000

Less: Exemption/Deduction
Net gift
Add: Net gift, Feb. 14
Total
Tax on P 500,000
350,000 x 6%
Gift tax
Less: Tax paid, Feb. 14
Gift tax due

P 14,000
21,000

35,000
26,000
9,000

December 14, 2001
Gross gift

P100,00
0
- .
100,000
30%
30,000

Less: Exemptions/Deductions
Net gift
Rate of tax
Gift tax
8.

Donor – Cabading
Donation – June 4

50


To Cabaroray

P
125,000

300,000
425,000
300,000
125,000

Philippine National Library
Gross gift
Less: Deductions – National Library
Net gift
Tax on P 100,000
25,000 x 2%

Exempt
P 500

Donor – Cabading
Donation – July 4
To University of the Philippines

P160,00
0
160,00
0
320,00
0
- .
320,00
0
125,000
445,00

0

Cababaero (2,000 x P80)
Gross gift
Less: Deductions/Exemptions
Net gift
Add: Net gift, June 4
Total
Tax on P200,000
245,000 x 4%
Gift tax
Less: Tax credit
Tax paid, June 4
Gift tax due
9.

P 2,000
9,800
11,800
500
11,300

Donor – Mr. Pano
Donation - April 12
To Wilda (800,000/2)

P
400,000
150,000
550,000

10,000
540,000

Acuna
Gross gift
Less: Exemption – To Wilda
Net gift
Tax on P500,000

P
14,000
2,400
16,400

40,000 x 6%
Gift tax
Less: Tax credit
Tax paid in U.S.
7,000
Limit (150/540 x 16,400)
4,556
Allowed
Donor’s tax due after tax credit

P

4,556
11,844

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Donor – Mrs. Pano
Donation – April 12, 2002
To Wilda

400,000

Tax on P200,000
200,000 x 4%
Donor’s tax payable

2,000
8,000
10,000

Donor- Mr. Pano
Donation – September 7
To Sigue (175,000/2)

P
87,500
.
87,500
540,000
627,500

Less: Deductions/Exemptions
Net gift
Add: Net gift, April 12

Total net gift
On P 500,000

P
14,000
7,650
21,650
11,844
9,806

127,500 x 6%
Donor’s tax
Less: Tax paid, April 12
Donor’s tax after tax credit
Donor – Mrs. Pano
Donation – September 7
To Sigue
Add: Net gift – April 12
Total net gift

87,500
400,000
487,500

On P200,000
287,500 x 4%
Tax on total
Less: Tax paid
Donor’s tax payable


2,000
11,500
13,500
10,000
3,500

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