DONOR'S TAX

1. For donor's tax purposes before the effectivity of the TRAIN, who among the
following are stranger(s) to you?

I. The grandson of the daughter of your grandson

II. The grandfather of the mother of your grandmother
III. The brother of the father of your grandfather
IV. The grandson of the sister of your mother

a. l and II b. III and IV c. III only d. IV only

2 A. The gift is perfected from the moment the donor effects the delivery either actually
or constructively of the property donated

a. True, true b. True false c. False, true d. False false

3. A. For purposes of the donor's tax before the effectivity of the TRAIN, second degree
strangers to each other.

B. Encumbrance on the property donated, if assured by the donor is deductible for

donor's tax purposes.

a. True, true b. True false c.False, true d. False, false

4. A In general, where real property is transferred during lifetime for less than adequate
and full consideration in money or money's worth, then the amount by which the value
of the property exceeds the value of the consideration shall, for the purpose of the
donor's tax, be deemed a gift.

B Gifts of conjugal property made by both pouses shall be considered as having been
made one half by the husband and the other half by the wife, and is taxable to cach
donor spouse

a. True, true b. True false c.False, true d.False false

5. A. If the value of the movable property donated is P5,000 or more, the donation and
the acceptance shall be made in writing. Otherwise the donation shall be void

B. Regardless of the value of the immovable property donated, the donation and the
acceptance shall be made in writing, otherwise the donation shall he void

a. True, true b. True, false c. False, true d.False false

6. The donation of a movable property may be made

a. Orally b. In writing c. Either A or B d.Neither A nor B

7. Using the preceding number, the donation and acceptance should be in writing if the
value of the property donated is

a. Less than P5,000 b. P5,000 or less c. P5,000,000 or more d. More than P5,000

8. A donation which takes effect upon the death of the donor

a. Donation mortis causa b. Partakes of the nature of a testamentary disposition

c. Shall be governed by the law on succession d. A, B and C

9. A donation which is intended by the donor to take effect during his lifetime

a. Shall be subject to the 6% donor's tax if more than 250,000 b. Shall be in writing if the
value exceeds P5,000 c. Donation inter-vivos d. A.B and C

10. The donation of a movable property shall be made

a. In writing b. In a public instrument c. Either A or B d. Orally

11. Using the preceding number acceptance by the donee may be made
a. In the same donee of donation b. In a separate document
c. Either A or B d. Neither A nor B

12. I. Beginning January 1, 2018, dowries or its made on account of marriage, on or

before its celebration, or within one year thereafter by parents to each of their lestimate
recognized natural or adopted children, to the extent of the first P1000, shall be exempt
from donor's tax
II. Donations in favour of u education and or charitable, religious, cultural or social
welfare corporations, institutions, accredited non-Government Organizations, trust of
philanthropic Organizations or research institutions or organizations, provided that no
amount of said gifts shall be used by the done for administration purposes shall be
exempt from donor's tax
a. True, true b. True, false c. False, true d.False false

13.A. As a rule, donation between husband and wife during the marriage is void
B. Donation can be made to concieved or unborn children
a. True, true b. True, false c. False, true d.False false

14. I made a donation of property with a FMV of P1,000,000 to his legitimate daughter
and to on February 8, 2016 on account of T's marriage to celebrated on February 14,
2015.
Determine the donor's tax due. Answer:

15. Mr. And Mrs. K made the following donations of conjugal funds and properties in
2018 (unless stated otherwise), as follows :
a. February 14 To L, a legitimate son a piece of land with a FMV of P400,000 on
account of L's graduation from college
b.May 14: To M, a legitimate daughter on account of M's i age to be celebrated on
December 25, 2018, house and lot with FMV of P1,000,000
c. June 14: To N, brother of Mrs. K. P200,000
d. September 14. To O, the efficient and beautiful secretary of Mr. K for taking care of
Mr. K while Mrs. K was vacationing in USA, jewelry worth P300,000
e. October 14: To P, the honest and good looking driver of Mis k who accompanied Ms.
K on her trip to and from USA, diamond ring worth P500,000
f. December 14: To O. the daughter of account of O's birthday. pieces of jewelry
inherited by Mr. K during marriage, with a FMV of P400,000
g. December 25: To R, a legitimate son residential house and lot with FMV of
P1.200,000 but subject to the condition that R would assume the more indebtedness in
the amount of P400,000
Determine the total donor's tax payable on each date of donation.
Answer:

16. Mr. A, a Filipino citizen made the following is to his children for the year 2018
Phil. USA. Canada. Australia
Net gift (before. 350,000. 300,000. 250,000. 100,000
(the P250,000
exemption)
Donor's tax paid. 15,000. 10,000. 5000
Required: Compute the donor's tax still due after tax credit
Answer:

17. With regard to campaign contributions, which of the following is not correct?
a. Unutilized or excess campaign funds shall be considered as subject to donor's tax
b. Campaign contributions to be considered as exempt from income tax must have
been utilized to cover a candidate's expenditure for his electoral campaign
c. Any winning candidate, who fails to file with the COMELEC the appropriate
Statement of Expenditures required under the Omnibus Election Code, shall be
automatically precluded from claiming such expenditures as deductions from his
campaign contributions.
d. Campaign contributions, net of a candidate's campaign expenditures must be
included candidate's taxable income as stated in his ITR filed for the subject taxable
year

18. In January 2, 2017, Nadine (not a dealer in securities) bought 100 shares of stock in
Y Corporation, a privately owned domestic corporation, for P500 per share.
She sold on November 19, 2018 the same 100 shares of stock in Y Corporation to her
best friend, Kathrynn, for P1,000 per share.
At the time of sale, the book value as well as the current market values of the Y
Corporation's assets and liabilities are as follows:

FMV for Real Property Assets

Book Value FMV Assessors Zonal
Independent
per FS Value Value
Appraiser

Current Assets 14,500,000 13,000,000

Fixed Assets
Land 1. 2,000,000 2,500,000 7,000,000.
6,000,000
Land 2. 2,000,000 2,200,000 4,000,000.
4,500,000
Building 1. 1,000,000 4,000,000
3,000,000
Building 2. 500,000 2,000,000
2,300,000

Current Liabilities. (2,500,000) (3,000,000)

Long-Term Liabilities. (2,500,000) (2,200,000)
Net Equity. 15,000,000
At the time of sale, the corporation had total outstanding shares of 10,000 shares. What
are the tax consequences of such sale?
a. The net gain of P50,000 from the sale shall be subject to the 15% CGT.
b. The difference of P156,000 between the FMV of the shares and the P100,000
received as consideration shall be deemed a donation
c. Both (a) and (b)
d. None of the above

19. A domestic corporation received a donation from its affiliate abroad. The BIR
assessed and demanded from the donee payment of the donor's tax relative to this
donation. The BIR reasoned that since the donor is located abroad while the donee is in
the Philippines, it is more practical, convenient, and expedient to collect the donor's tax
from the donee. Should the donee be liable to pay the donor's tax?
(a) Yes. The parties cannot escape the donor's tax by the mere expedient of locating
the donor abroad
(b) No The person or entity liable to pay the donor's tax is the donor
(c) Yes, if by agreement among the parties, it is the one that shall have the burden of
paying the donor's tax
(d) None of the above.

20. To comply with the decision of the court in their annulment case, former spouses
Allan and Bessy submitted a Compromise Agreement involving the partition of their real
properties. Shall partition and eventual transfer of the real properties based on such
Compromise Agreement be subject to donor’s tax?

(a) Yes. The Compromise Agreement gives rise to the transfer of properties during the
lifetime of the spouses.

(b) No. The said adjudication, transfer, or distribution is not subject to the donor's tax
since there is no donative intent on the part of the parties.
(c) All of the above.

(d) None of the above.