REAL PROPERTY

SAME
PROVISION
TAX RATES VALUATION with estate tax
PERSONAL
APPLICABLE
FMV
at the time of
RR 2-2003

6%
the gift
NOTICE OF
DONATION
TRAIN LAW
gift is at least
P 250,000 P50,000
RA 8424
EXEMPT DONOR’S
TAX TABLE TAX RETURN
30%
PAY AS 30 DAYS
YOU FILE after gift is
made
 ILLUSTRATION

Mr. Caticlan, a resident citizen, made the following donations during OCT 30
the year: TOTAL GIFT P 1,200,000
LESS: DEDUCTIONS P 150,000
FEB 2: to his brother who is getting married; P300,000
TOTAL NET GIFT P 1,050,000
MAR 18: to a public school for public use; P200,000 LESS: P 250,000
APR 15: to daughter on account of marriage; P400,000 TAXABLE NET GIFT P 800,000
AUG 5: to an accredited non-profit research institution; P400,000 x 6%
OCT 30: donation of land valued at P500,000 to Mr. Caticlan’s DONOR’S TAX DUE P 48,000
father subject to a condition that the latter shall assume LESS: TAX CREDITS P 27,000
the P150,000 unpaid real property tax on the property TAX PAYABLE P 21,000

THE COMPUTATION OF THE DONOR’S TAX IS ON A

CUMMULATIVE BASIS OVER A PERIOD OF ONE CALENDAR YEAR
FOREIGN SINGLE COUNTRY:
TAX CREDITS Foreign Net Gifts
x Philippine Donor’s Tax Due
World Net Gifts

ILLUSTRATION:
TOTAL NET GIFT P 800,000
Philippines Taiwan LESS: P 250,000
Total Net Gifts P 500,000 P 300,000 TAXABLE NET GIFT P 550,000
Donor’s Tax Paid 15,000 21,000 x 6%
P 300,000
DONOR’S TAX DUE P 33,000 x P 33,000
P 800,000
LESS: TAX CREDITS P 12,375
P 15,000 = P 12,375 LIMIT

TAX PAYABLE P 5,625 = P 21,000 ACTUAL

FOREIGN SINGLE COUNTRY:
TAX CREDITS Foreign Net Gifts
x Philippine Donor’s Tax Due
World Net Gifts

ILLUSTRATION:
Philippines Taiwan Korea Total
Total Net Gifts P 500,000 P 300,000 P 200,000 P 1,000,000
Donor’s Tax Paid 15,000 21,000 5,000 41,000

MULTIPLE COUNTRIES:
Total Foreign Net Gifts
x Philippine Donor’s Tax Due
World Net Gifts
 FOREIGN MULTIPLE COUNTRIES:
TAX CREDITS Total Foreign Net Gifts
x Philippine Donor’s Tax Due
World Net Gifts

ILLUSTRATION: TOTAL NET GIFT P 1,000,000

Philippines Taiwan Korea Total LESS: P 250,000
Total Net Gifts P 500,000 P 300,000 P 200,000 P 1,000,000 TAXABLE NET GIFT P 750,000
Donor’s Tax Paid 15,000 21,000 5,000 41,000 x 6%
DONOR’S TAX DUE P 45,000
TAIWAN: KOREA: LESS: TAX CREDITS P 18,500
P 300,000 P 200,000 P 15,000
x P 45,000 x P 45,000
P 1,000,000 P 1,000,000 TAX PAYABLE P 11,500
= P 13,500 LIMIT = P 9,000 LIMIT
= P 21,000 ACTUAL = P 5,000 ACTUAL = P 18,500 PER COUNTRY LIMIT

WORLD: P 500,000 ÷ P 1,000,000 x P 45,000 = P 22,500 WORLD LIMIT