Donors Tax

PAUL AGUSTIN
Assignment – Donor’s Tax
1. A donor made the following donation during 2018:

 To Abel, a car worth P 800,000.
 To Jen, a condominium unit worth P 3,000,000 in Macau.
 To Gore, GJ Company shares (domestic corp.) amounting to P 250,000.
 To Alexa, P 100,000 worth of shares of stock of a resident foreign corporation where 90% of its
operation is in the Philippines.
 To Earl, a building in Singapore valued at P 5,000,000 mortgaged for P 2,000,000 assumed by the
done.
 To Hananiah, parcel of land in Isabela, P 1,500,000.
 To Chen, P100,000 bank deposit in BPI.
 To Kristine, P 100,000 bank deposit in Metrobank, US branch.
 To Gavrie, P 500,000 cash.
The donor also made the following transfer of properties within the year:
Property Consideration received FMV at the time of transfer
Land 1 – QC P 2M P 3M
Land 2 – Taguig 3M 2M
Land 3 – USA 5M 10M
Car – Manila 800K 1M
Required:
Determine the amount of gross gifts subject to donor’s tax assuming the donor is
a. Resident citizen = 16,550,000
b. RA = 16,550,000
c. NRA with reciprocity
=3,000,000
d. NRA without reciprocity
=3,450,000
2. Juan, a resident citizen, made the following donations in 2018:
 To Pedro, a parcel of land worth P 4,500,000 located in Pasig.
 To Amber, a parcel of land worth P 1,000,000 located in Malaysia.
 To Roger, PLDT shares amounting to P 1,500,000.
 To Aby, a building in Belgium worth P 2,000,000 mortgaged for P 500,000 assumed by the
donee.
 To Alex, land in Pampanga worth P 3,000,000.
 To Jamylle, P 500,000 cash in PNB NY.
Juan has also transferred the following properties:

FMV SP
Car, Alabang 600,000 400,000
Car, Malaysia 600,000 400,000
Land in Mactan Cebu 1,000,000 1,000,000
Required:
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PAUL AGUSTIN
Determine the amount of gross profit subject to donor’s tax assuming that the donor is
a. RA
b. NRA with reciprocity
3. Mike is a sole proprietor engaged in the distribution of various consumer products. During the year, he
sold his vacant lot located in Davao valued at P 2,500,000 to his long time buddy, Leomar for only P
1,500,000. The property was purchased by Mike two years ago at a cost of P 1,200,000.
Required: Determine the following:

a. Donor’s tax due= 45,000
b. CGT
Fair Market Value 2,500,000
CGT Rate 0.06
Capital Gains Tax 150,000
Assuming the land was classified as an ordinary asset, determine the following:
a. Donor’s tax due: 0
b. CGT
4. Pedro sold to Ana, his shares of stock in Makabayan Corporation (a closely held domestic corporation)
for P 400,000 when its fair market value was P 850,000. The shares were purchased by Pedro five years
ago for P 500,000.
Required:
Determine the following:
a. Donor’s tax due.= 27,000
b. CGT = zero
Assuming that the shares were sold in the ordinary course of business, at arm's length
transactions, without donative intent, determine the following:
a. Donor’s tax due = 0
b. CGT : 850,000 x0. 06 = 51,000
5. In 2018, a resident citizen made the following gifts:

 On March 1, P 200,000 to his son, on account of marriage celebrated on January 1, 2017.
 On May 30, a parcel of land worth P 500,000 to his brother, subject to the condition that the
donee would assume the mortgage indebtedness of in the amount of P 100,000.
 On June 30, P 300,000 to an ailing friend.
 On July 31, P 200,000 cash to Bantay Bata.
 On September 30, a house and lot worth P 3,000,000 to his daughter and son in law, on account
of their scheduled marriage on December 25, 2018. A mortgage of P 600,000 will be assumed by
the donee.
Required: Determine the tax payable on:

a. March 1
Gross Gift 200,000
Exempt 250,000
PAUL AGUSTIN
Donor’s Tax Payable = 0

b. May 30
Gross Gift 500,00
Mortgage (100,000)
Prior Gift 200,000
TOTAL GIFT 600,000
Tax Exempt (250,000)
Tax Rate 0.06
Donor’s Tax Payable = 21,000
c. June 30
Gross Gift 300,000
Prior Gift 600,000
TOTAL 900,000
TAXABLE GIFT 650,000
Donor’s Tax 0.06
Donor’s Tax Due 39,000
Tax Paid (21,000)
Donor’s Tax Due = 18,000
d. July 31 =
e. Sep. 30
Gross Gift 3,000,000
Encumbrance (600,000)
Prior Gifts 06/30 900,000
TOTAL GIFTS 3,300,000
Taxable Net Gift 3,050,000
Donor’s Rate 0.06
Tax Paid Due 06/30 (39,000)
DONOR’S TAX DUE 144,000
6. A resident citizen made the following donations:

 March 30, 2018: P 100,000 to a friend as a wedding gift.
 May 25, 2018: P 2000,000 to their church for Flores de Mayo celebration.
Required: Determine the donor’s tax payable on:

a. March 30, 2018
Gross Gift 100,000
Exempt (250,000)
NO DONOR’S TAX
b. May 25, 2018 – EXEMPT
PAUL AGUSTIN
7. Husband and wife, citizens and residents of the Philippines made the following donations during the
calendar year:
June 6, 2018
 To Jun-Jun, a legitimate son, on account of marriage P 460,000.
 To Bea, a legitimate daughter, property with mortgage of P 4,000 which was assumed by Bea,
FMV P 20,000
October 8, 2018
 To Robert, a legitimate son of the wife by a prior mortgage on account of marriage, P 60,000.
November 4, 2018
 To a charitable organization (25% of donations made were used for admin purposes), P 10,000.
 To Cindy, a family friend, P 4,000.
Required: Determine the donor’s tax payable of the spouses on:

a. June 6, 2018
b. October 8, 2018
c. P November 4, 2018
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PAUL AGUSTIN

Assignment – Donor’s Tax

1. A donor made the following donation during 2018:

Juan has also transferred the following properties:

Required: Determine the following:

5. In 2018, a resident citizen made the following gifts:

Required: Determine the tax payable on:

Donor’s Tax Payable = 0

6. A resident citizen made the following donations:

Required: Determine the donor’s tax payable on:

Required: Determine the donor’s tax payable of the spouses on:

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