Donor's Tax: Answer: D

Donor’s Tax
Use the following data for the next four (4) questions:
Mr. and Mrs. Mapagbigay, made the following donations during 2019:
 Jan. 25:
To Oliver, their legitimate son, on account of marriage last January 20, 2016, car worth P400, 000
with P200, 000 unpaid mortgage, 1/2 was assumed by the donee.
 May 31
To John, brother of Mr. Mapagbigay, his capital property worth P200, 000 on account Of
marriage 6 months ago with a condition that the donee will pay the donor's tax thereon.
 July 15:
To Felicity, daughter of Mrs. Mapagbigay by former marriage, on account of her marriage 12
months ago, Mrs. Queen's paraphernal property worth P100,000.
 Aug. 20
Conjugal car of the couple worth P400,000, with P200,000 unpaid mortgage, ½ assumed by
Felicity and P500,000 worth of land to their four sons on account of their graduation, 20% of
which was owned by their closest friend Roy, who agreed to donate his share through a public
document.
1. The gift tax payable of Mr. Mapagbigay as of May 31 should be:
A. 8,000 C. P7, 200
B. 7,000 D. P6, 000
Answer: D
JAN. 25
Mr. Mrs.
Gross gifts = P400, 000/2 P200, 000 200,000

Mortgage assumed by the donee = (P200k x 50%) (50,000)
(50,000)
P150, 000 50,000
Less: Exempt gifts (250,000) (250,000)
Taxable Net Gifts P100, 000 250, 000
Tax Due (old tax table) Exempt Exempt
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MAY 31
Gross Gift P 200,000
Add: Prior net gift 150 000
Aggregate net gifts as of May 31 350,000
Less: Exempt gift (250,000)
Aggregate taxable net gift as of May 31 P 100,000
X Donor’s Tax Rate under TRAIN Law 6%
Donor’s Tax Payable- May 31 P 6,000
2. The gift tax payable of Mrs. Mapagbigay as of July 15 should be:
A. PI, 000 c. P15, 000
B. P2, 600 D. P 0
Answer: D
Solution:
JULY 15 Mrs.
Gross gifts P 100, 000
Add: Prior net gifts 150,000
Total 250, 000
Less: Exempt gifts (250,000)
Taxable net gift P0
Donor's Tax Due Exempt
3. The gift taxes payable of Mr. and Mrs. Mapagbigay on August 20 should be:
A. P27, 000 & P21, 000
B. P21, 000 & P21, 000
C. P 21,000 & P 21, 000
D. P 6,000 & P 0
Answer: C
AUG. 20:
MR. MRS.
Gross gifts (To Felicity; stranger) P 200, 000` 200, 000
Additional gifts (to their sons) P500, 000 x 80% /2 200, 000 200, 000
Mortgage assumed by the donee = P100, 000/2 (50, 000) (50, 000)
Add: Prior Net Gifts Total 350, 000 350, 000
Total P 700, 000 60, 000
Less: Exempt Gifts Net (250, 000) (250, 000)
Net Taxable Gifts 450, 000 350, 000
x Donor's Tax Rate 6% 6%
Donor's Tax Due 27, 000 21, 000
Less: Prior Tax Payments (6, 000) -
Donor's Tax Payable —Aug. 20, 2018 P 21, 000 21, 000
4. The gift tax payable of Roy on June 20 should be:
A. P 30, 000 c. P45, 000
B. P 6,000 d. P 0
Answer: D
Gross gifts P500, 000
X 20%
Add: Prior net gifts P100, 000
Less: Exempt gifts (250,000)
Taxable net gift (P150, 000)
Donor's Tax Due Exempt
5. Donor's tax credit is not allowed to a donor who is a:
A. Resident citizen
B. Non-resident citizen
C. Resident alien
D. Non-resident alien
Answer: D
The next two (2) questions are based on the following data:
Patrick, resident alien, made the following donations for the year 2018:
 April 15:
 To Hayley (legally adopted child): Car worth P700, 000 in the Philippines.
 To Rebekah (daughter): Car in Canada worth P300, 000. The donor's tax paid in Canada
was $200 ($1 = P45)
 July 20:
 To Sophie (niece in Manila): P200, 000 worth of personal property.
 To Davina (legitimate daughter on account of marriage, July 18, 2017): Car in Manila,
worth P400, 000 but mortgaged for P200,000, ½ of which was assumed by the donee.
6. The gift tax payable on April 15 should be:
A. 45,600 C. P44, 000
B. P30, 000 D. P36, 000
Answer: D
Gross Gift (P700,OOO + 300,000) P 1, 000, 000
Tax exempt gifts (250,000)
Taxable Net Gif P750, 000
Donor's Tax Due = P750, 000 x 6% P 45, 000
Less: Tax Credit
Actual = $200 x P45 P 9, 000
vs. Limit = 300/ 1, 000 x P45,OOO P 13,500
Allowed: Lower amount (P9, 000)
Donor's Tax Payable P 36,000
7. The gift tax payable on July 20 should be:
A. P 40,000 C. P84, 000
B. P30, 000 D. P80, 000
Answer: B
Gross Gift July 20 (P200, 000 + 400,000) P600, 000
Mortgage assumed by the donee (100,000)
Add: Prior Net Gift 1, 000 000
Total 1, 500, 000
Less: Tax exempt gifts (250,000)
Taxable Net Gift P1 250,000
Donor's Tax Due 6% P75, 000
Less: Previously paid donor's tax (36, 000)
TAX CREDIT
Actual = P9, 000
vs. Limit = 300/1,500 x P75, 000 = P15, 000 (9,000)
Donor's Tax Payable P30 000
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Donor's Tax: Answer: D

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Donor's Tax: Answer: D

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Donor’s Tax

1. The gift tax payable of Mr. Mapagbigay as of May 31 should be:

A. 8,000 C. P7, 200

B. 7,000 D. P6, 000

Gross gifts = P400, 000/2 P200, 000 200,000

P150, 000 50,000

Less: Exempt gifts (250,000) (250,000)

Taxable Net Gifts P100, 000 250, 000

Tax Due (old tax table) Exempt Exempt

Gross Gift P 200,000

Add: Prior net gift 150 000

Aggregate net gifts as of May 31 350,000

Less: Exempt gift (250,000)

Aggregate taxable net gift as of May 31 P 100,000

X Donor’s Tax Rate under TRAIN Law 6%

Donor’s Tax Payable- May 31 P 6,000

2. The gift tax payable of Mrs. Mapagbigay as of July 15 should be:

A. PI, 000 c. P15, 000

Gross gifts P 100, 000

Add: Prior net gifts 150,000

Total 250, 000

Less: Exempt gifts (250,000)

Taxable net gift P0

Donor's Tax Due Exempt

A. P27, 000 & P21, 000

B. P21, 000 & P21, 000

C. P 21,000 & P 21, 000

Gross gifts (To Felicity; stranger) P 200, 000` 200, 000

Add: Prior Net Gifts Total 350, 000 350, 000

Total P 700, 000 60, 000

Less: Exempt Gifts Net (250, 000) (250, 000)

Net Taxable Gifts 450, 000 350, 000

x Donor's Tax Rate 6% 6%

Donor's Tax Due 27, 000 21, 000

Less: Prior Tax Payments (6, 000) -

4. The gift tax payable of Roy on June 20 should be:

A. P 30, 000 c. P45, 000

Gross gifts P500, 000

Add: Prior net gifts P100, 000

Less: Exempt gifts (250,000)

Taxable net gift (P150, 000)

5. Donor's tax credit is not allowed to a donor who is a:

6. The gift tax payable on April 15 should be:

A. 45,600 C. P44, 000

B. P30, 000 D. P36, 000

Gross Gift (P700,OOO + 300,000) P 1, 000, 000

Tax exempt gifts (250,000)

Taxable Net Gif P750, 000

Less: Tax Credit

Actual = $200 x P45 P 9, 000

vs. Limit = 300/ 1, 000 x P45,OOO P 13,500

Allowed: Lower amount (P9, 000)

Donor's Tax Payable P 36,000

7. The gift tax payable on July 20 should be:

A. P 40,000 C. P84, 000

B. P30, 000 D. P80, 000

Gross Gift July 20 (P200, 000 + 400,000) P600, 000

Mortgage assumed by the donee (100,000)

Add: Prior Net Gift 1, 000 000

Total 1, 500, 000

Less: Tax exempt gifts (250,000)

Taxable Net Gift P1 250,000