ILLUSTRATION 12:

Donor's Tax Due P60,OOO

Less: Tax Credit
Donor's Tax Payable P30,800
A resident citizen taxpayer made the following gifts to his relatives:
Philippines USA UK
Gross gift P750,OOO P500,OOO 250,000 P500,ooo
Deductions 250,000 200,000 150,000 150,000
Tax paid 25,000 12,000 10,000

Question: How much is the donor's tax payable after Tax Credit?
Answer: P30,800 computed as follows:
Total Gross Gifts
Total deductions (750,000)
Net gift
Less: tax exempt (250,000)
Net taxable gift
Tax Rate (TRAIN Law) 6%