DONOR’S TAX
EXERCISES
02/12/2025
ILLUSTRATION 1:
On January 15, 2018, Jose sold a vacant lot held as capital asset for
600,000 to his brother-in-law. The assessed value and zonal value of the
land were 750,000 and 1,000,000 respectively. The sale is subject to:
a. Subject to donor’s tax only of 9,000
b. Subject to capital gains tax only of 60,000
c. Subject to donor’s tax of 9,000 and capital gains tax of 60,000
d. Subject to donor’s tax of 9,000 or capital gains tax of 60,000 at the
option of Jose
Answer: B.
The transaction is considered sale for insufficient consideration.
However, since the property sold is a real property classified as
capital asset and assumed to be located in the Philippines, the
applicable tax is CGT.
ILLUSTRATION 2:
On January 15, 2018, Jose sold a real property used in business for 600,000
to his brother-in-law. The assessed value and zonal value of the land were
750,000 and 1,000,000 respectively. The sale is subject to:
a. Subject to donor’s tax only of 9,000
b. Subject to capital gains tax only of 60,000
c. Subject to donor’s tax of 9,000 and capital gains tax of 60,000
d. Subject to donor’s tax of 9,000 or capital gains tax of 60,000 at the
option of Jose
Answer: A
FMV 1,000,000
Consideration (600,000)
Excess 400,000
Less: (250,000)
Net Taxable Gifts 150,000
Rate 6%
Donor’s Tax Due 9,000
ILLUSTRATION 3:
In 2018, Ronald gave a property with a fair market value of 2,000,000 with
unpaid mortgage of 200,000 to be paid by him, to his son Daniel and
Daniel’s bride Emily, on account of their marriage 15 months ago. The
allowable deduction is.
a. 10,000 c. 40,000
b. 20,000 d. 0
Answer: D
The mortgage is non-deductible because it was not assumed by any
of the donees.
ILLUSTRATION 4:
In 2018, Ronald gave a property with a fair market value of 2,000,000 with
unpaid mortgage of 200,000 to be paid by him, to his son Daniel and
Daniel’s bride Emily, on account of their marriage 15 months ago. The
donor’s tax payable should be:
a. 300,000 c. 105,000
b. 344,000 d. 120,000
Answer: C
Gross Gift 2,000,000
Less: Exempt Gift (250,000)
Net Taxable Gift 1,750,000
Rate 6%
Donor’s Tax Due 105,000
ILLUSTRATION 5:
Mr. & 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 400,000 with 200,000 unpaid mortgage, ½ assumed
by the done.
May 31: To John, brother of Mr. Mapagbigay, his capital property worth
200,000 on account of marriage 6 months ago with a condition that the
done will pay the donor’s tax thereon.
How much is the gift tax payable of Mr. Mapagbigay as of May 31?
a. 8,000 c. 7,200
b. 7,000 d. 6,000
My 31
Answer: D Gross gifts 200,000
Gross gifts (Jan 25) 200,000 Prior net gift 150,000
Mortgage assumed (50,000) Aggregate net gifts 350,000
Excess 150,000 Less: Exempt Gift (250,000)
Less: Exempt Gift (250,000) Taxable Net Gift 100,000
Taxable Net Gift (100,000) Rate 6%
Donor’s Tax Payable 6,000
ILLUSTRATION 6:
Value Property Donee
100,000 Cash Juan, brother on account of marriage
400,000 Jewelries Kat, gf residing in Korea
1,500,000 House & Lot Parents, silver wedding anniversary gift
300,000 Car Fe, sister, donation is revocable
50,000 Cash International Rice Research Institute
100,000 Cash Guillermo, father of his mother
70,000 Motorcycle Kaye, niece, donation is embodied in the will
The total donor’s tax payable should be:
a. 111,000 c. 160,000
b. 126,000 d. 220,000
Answer: A
To Juan, Parents, & Guillermo 1,700,000
To Kat 400,000
Less: Exempt gifts (250,000)
Taxable Net Gift 1,850,000
Donor’s Tax Due @ 6% 111,000