1.

First statement: Donation is an act of liberty whereby a person disposes gratuitously of a

thing or right in favor of another accepts it.

Second statement: A gift that is incomplete because of reserved powers becomes

complete when the donor renounces the power of his right to exercise the reserved
power ceases because some event or contingency or the fulfillment of some condition
other than donor’s death.

o Both Statements are true

o Both Statements are False
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

2. First statement: Donation inter vivos happens when the donor intends that the donation
shall take effect during his lifetime, through the property shall be delivered till after his
death.

Second statement: Donation of immovable property requires that the donation be made in
a public document specifying therein the property donated and the value of the charges
which the donee must satisfy.

o Both Statements are true

o Both Statements are False
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

3. First statement: The donation of a movable may be made only in writing.

Second statement: The law in force at the time of the completion of the donation shall
govern the imposition of donor’s tax.

o Both Statements are true

o Both Statements are False
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true
4. First statement: An oral donation requires simultaneous delivery of the thing of the
document representing the right donated.

Second statement: Renunciation by the surviving spouse of his/her share in the conjugal
partnership or absolute community after the dissolution of the marriage in favor of the
heirs of the deceased spouse or any other person’s is not subject to donor’s tax.
o Both Statements are true
o Both Statements are False
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

5. First statement: if the value of the personal property donated exceeds three thousand
pesos, the donation and acceptance shall be made in writing to be considered a valid
donation.

Second statement: a transfer is a gratuitous or without consideration and accordingly

qualifies as a donation, if no economic benefit measurable in money or in money’s
worth flowed to the transferor from the transferee.

o Both Statements are true

o Both Statements are False
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

6. First statement: Donation made between business organizations and those made
between an individual and a business organization shall be considered as a donation
made to a stranger.

Second statement: with the exception of moderate donations for charity or an occasions
of family rejoicing neither spouse may donate any community property or conjugal
property without the consent of the other.

o Both Statements are true

o Both Statements are False
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

7. First statement: General renunciation by an heir, including the surviving spouse, of

his/her share in the hereditary estate left by the deceased is not subject to donor’s tax
 unless specifically and categorically done in favor of identified heir/s to the exclusion or
disadvantage of the co-heirs in hereditary estate.

Second statement: Every donation between the spouses during the marriage shall be
void except for moderate gifts, which the spouse may give each other on the occasion of
any family rejoicing and donation mortis causa.

o Both Statements are true

o Both Statements are False
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

8. First statement: the gross gifts if a donor who is a citizen, whether residents or non-
residents of the Philippines, will include all properties wherever situated.

Second statement: Where property, other than real property subject to capital gains tax,
is transferred for less than adequate and full consideration in money or money’s worth,
then the amount by which the fair market value of the property exceeded the value if
the consideration shall for the purpose of donor’s tax, be deemed gift and shall be
included in computing the amount of gifts made during the calendar year.

o Both Statements are true

o Both Statements are False
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

9. First statement: The gross gifts of a donor, who is an alien, whether resident or non-
resident of the Philippines, will include only properties situated in the Philippines.

Second statement: A sale, exchange, or other transfer of property made in the ordinary
course of business (a transaction which is a bona fide, at arm’s length, and free from any
donative intent), will be considered as made for an adequate and full consideration in
money or money’s worth.

o Both Statements are true

o Both Statements are False
o The first statement is true and the second statement is false
 o The first statement is false and the second statement is true

10. First statement: The rule of reciprocity that applies to estate tax also applies to non-
resident alien donor as far as donation of intangible personal property situated in the
Philippines.

Second statement: Before TRAIN (RA No. 10963), in case when a property donated
comes from common properties, the husband and the wife can claim dowry exemption
being donors of one-half each of the common property.
o Both Statements are true
o Both Statements are False
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

11.) First Statement: A sold his car (cost P300, 000) to B for P500, 000. The car has a fair market value of
P900, 000 at the time of sale. The difference of P400, 000 in selling price and fair market value constitute
a gift subject to donor’s tax.

Second Statement: C purchased a lot and cottage in Alaminos City in 2017 for P1, 000, 000. It was used
as summer vacation house by his family. In 2018, C decided to sell the lot and cottage to D for P2, 000,
000 although its present market value is P2, 500, 000. The P500, 000 difference in selling price and
market value is a gift but not subject to donors tax.

o Both statements are true

o Both statement are false
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

12.) First Statement: In showing gross gifts in the donor’s tax return, real property should be valued at
the current and fair market value, as shown in the assessment rolls, or fair market value, as determined
by the Commissioner of Internal Revenue, whichever is higher.

Second Statement: In showing gross profit in the donor’s tax return, personal property should be valued
at current fair market value or at cost, whichever is higher.

o Both statements are true

o Both statement are false
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true
13.) Since donation to a charitable institution has a deduction without any ceiling.

First Statement: The net gift will be zero, so that in computing the donor’s tax, the donation may be
omitted in gross gift if it is likewise omitted in deductions.

Second Statement: The gross gifts should be reported and the deduction shall be claimed.

o Both statements are true

o Both statement are false
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

14.) First Statement: A donation on which a donor’s tax was not paid is a valid donation.

Second Statement: The government is not bound by any agreement between the donor and the donee
that the latter shall pay the tax on the donation.

o Both statements are true

o Both statement are false
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

15.) First Statement: Husband and wife are considered as joint taxpayers for purpose of donor’s tax.

Second Statement: Under the TRAIN (RA No. 10963), dowries or gifts on account of marriage are no
longer allowed to be deducted from the gross gift of all donors.

o Both statements are true

o Both statement are false
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

16.) First Statement: Gifts made to or for used of the National Government or any entity created by any
of its agencies whether or not conducted for profit, or to any political subdivision of the Government is a
deduction from gross profit of all donor, whether resident or not.
Second Statement: In showing gross profits in the donor’s tax return, the real property should be valued
at the current and fair market value, as shown in the assessment rolls, or the fair market value, as
determined by the Commissioner of Internal Revenue, whichever is higher.

o Both statements are true

o Both statement are false
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

17.) First Statement: Tax credit for foreign donor’s taxes paid by a donor, including a non-resident alien
donor, is allowed as deduction from Philippine donor’s tax due.

Second Statement: In showing gross gifts in the donor’s tax return, personal property should be valued
at current fair market value or at cost, whichever is higher.

o Both statements are true

o Both statement are false
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

18.) First Statement: The donor engaged in business shall give a notice of donation on every donation
worth at least P50, 000 to the RDO which has a jurisdiction over his place of business within 30 days
after receipt of the qualified done institution’s duly issued Certificate of Donation, which shall be
attached to the said Notice of Donation, stating that not more than 30% of the said donation /gifts for
the taxable year shall be used for administration purposes.

Second Statement: In case of both non-resident citizen and non-resident alien donors, the donor’s tax
return shall be filed with Philippine Embassy or consulate where they are domiciled at the time of the
transfer, or Office of the Commissioner.

o Both statements are true

o Both statement are false
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true

19.) First Statement: All gifts made on the same date pay one donor’s tax only.
Second Statement: A donation inter vivos to a charitable organization is deductible from the gross gifts of
both resident alien and non-resident alien donor’s.

o Both statements are true

o Both statement are false
o The first statement is true and the second statement is false
o The first statement is false and the second statement is true
o

20.Which of the following is wrong? A distinction between a donation inter vivos and a donation
mortis causa is:

o The first is subject to the donor’s tax while the second is subject to the estate tax.

o The first always requires a public document while the second may not require a public
document.

o The first takes effect during the lifetime of the grantor while the second takes effect after
the death of the grantor.

o The first is valued at fair market value at the time the property is given while the second
is valued at fair market value at the time of death of the grantor.

21.The following are the requisites of a donation for purposes of the donor’s tax, except one:

o Capacity of the donee

o Donative intent

o Capacity of the donor

o Delivery of the subject matter of gift

22.Which of the following statements is correct? A donation inter vivos by husband and wife,
jointly during marriage

o Is a donation of community property that will require one computation of the donor’s
tax, if the spouses are under the system of absolute community of property.

o Is a donation of conjugal property that will require one computation of the donor’s tax, if
the spouses are under the system of conjugal partnership of gains.
 o Is a donation of exclusive property by either spouse that will require one computation of
the donor’s tax, if the spouses are under the system of conjugal partnership of gains.

o Is a donation of each spouse to the extent of one-half that will require separate
computation for two donor’s taxes, under whichever property relationship exists
between spouses.

23.Situation 1: M, in trading business, had a receivable of P150,000 from N. Without exerting

utmost effort to collect, M cancelled the indebtedness of N.

Situation 2: O sold to P personal property worth P200,000 for a consideration of P50,000, to

take effect immediately upon receipt of the consideration.

Which statement is correct?

o Situation 1 is a bad debt expense of the business and should not be treated as involving
a taxable donation.

o Situation 1 involves a donation of P150,000 and should be covered by donor’s tax

return within thirty days from the date of cancellation of the indebtedness.

o Situation 2 shall be considered a bad bargain and not involving a taxable donation

o Situation 2 involves a donation of P200,000 and should be covered by a donor’s tax

return within thirty days from the date of the sale.

24.Three of the following are exempt or excluded from the donor’s tax. Which is the exception?

o Donation of a condominium in Hongkong to a Filipina by a British national residing in

the Philippines.

o P150,000 donation to a non-profit school.

o P100,000 cash given by a resident alien donor to a charitable institution organized as a

non-stock entity.

o P300,000 cash given by a non-resident alien donor to his legitimate son who is getting
married in the Philippines to a Filipina
25.All if the following, except one, are exempt from gift tax under special laws:

o A donation to the National Social Action Council

o A donation to International Rice Research Institute

o A donation to Development Bank of the Philippines

o A donation to the Integrated Bar of the Philippines

26.Which of the following is not taxable?

o A Filipino citizen donated a parcel of land located in the United States to Selah, a non-
resident alien.

o Vienna and Wilson are the only heirs of Allan. Vienna renounces his share of
inheritance in favor of Wilson.

o Pete gives his wife a diamond ring worth P500,000 as a birthday gift.

o On June 1, 2018, Timothy made a gift of P300,000 to his daughter on account of her
marriage celebrated on May 1, 2017.

27.One of the following statements is false:

o Donations between persons guilty of concubinage or adultery are void.

o A donation by Mocha Uson to Duterte, the President of the Philippines, in view of his
public office is void in all cases.

o Donations to conceived or unborn children are valid in all cases.

o Contracts of donation between husband and wife are void in all cases.

No solutions required. All answers shall be provided in the following format:

Use comma (,) to separate number digits. Do not use space after the comma. All answers shall
be rounded off to nearest peso. No decimals/centavo figures allowed.

Do not place peso sign before your answers.

Example of answer formats to input:

100

1,000

10,000

100,000

1,000,000

28.Ray donated a total amount of P1,000,000, ½ to the Quezon City Hall and ½ to a charitable
institution. Upon inquiry, it was verified that the charitable institution’s total receipts from
donation amounted to P10,000,000 and its total administrative expenses reached P4M. Ray can
claim a total deduction/exemption of: 500000

29.Donations on one date by Hubert, a father, of property and cash, as follows: To Imelda, a
legitimate daughter, on account of marriage, land with a fair market value of P500,000 but
subject to a mortgage of P100,000 which is assumed by Imelda; To John, a legitimate son, on
account of marriage, cash of P200,000.

The total taxable net gifts made is: 350000

30.In 2018, Chris made the following gifts:

• On June 1, 2018, P150,000 to Leo, his son, on account of his marriage celebrated on May
1, 2017

• On July 10, 2018, a parcel of land worth P180,000 to his father, subject to the condition
that the father would assume the mortgage indebtedness of Chris in the amount of P40,000

• On September 30, 2018, P150,000 dowry to his daughter Myrna, on account of her
scheduled marriage on October 25, 2018, and another wedding gift worth P20,000 on
November 23, 2018.

How much is the total taxable net gifts? 210000

31.Mr. Han, widower, gave the following donations:

• P150,000 on January 3, 2018 to Anna, sister, given on account of marriage on January 1,

2018

• P150,000 on February 5, 2018 to Venice, legitimate child, given on account of marriage

on May 5, 2018

• P150,000 on June 5, 2018 to Camille, legitimate child, given on account of marriage on

June 2, 2017

How much is the donor’s tax due on the last donation? 9000

32.Mr. and Mrs. J made the following donations out of their community property during the
year.

• Jun. 15, 2020 : to Bea, legitimate daughter, on account of marriage, on January 14, 2017,
P300,000 cash

• Aug.15, 2020 : to Lea, legitimate daughter, who is going abroad, P100,000 cash

• Oct. 15, 2020 : to Jea, car with FMV of P500,000

What is the tax liability of the husband and wife for all their donations? 24000

33.A citizen and resident of the Philippines, made donations on January 8, 2018, as follows:

• Donation to a legitimate son, property in the United States (on which a U.S. donor’s tax
of P8,000 was paid), with FMV of P300,000

• Donation to a legitimate daughter, cash in the Philippines of P200,000

How much is the donor’s tax credit for donor’s tax paid to U.S.? 8000
34.Mr. Sol made the following gifts to his relatives:

• Philippines: Gross gifts, P750,000; Deductions, P250,000

• USA: Gross gifts, P500,000; Deductions, P200,000; Tax paid, P16,000

• UK: Gross gifts, P250,000; Deductions, P150,000; Tax paid, P6,000

The donor’s tax due after credit is: 21667

35.Mr. P, resident, made the following donations for the year 2020:

• April 15 : to Cecille, car worth P700,000 in the Philippines and to Sam, his daughter, car
in USA worth P300,000. They paid $180 gift tax in U.S. ($1-P51)

• July 20 : to Remy, niece in Manila, P200,000 worth of personal property and to Ruth, car
worth P400,000 but mortgaged for P200,000, ½ of which was assumed by donee.

How much is the donor’s tax due on July 20, 2020? 15000