Taxation Law 2 – Atty. Dizon 05/17/21
M.T.A.
1.What is the nature of a Donor’s Tax?
2. Is it a Property Tax?
3. What kind of tax is a Donor’s Tax?
4. What is the main purpose of the Donor’s Tax?
Remember the different purposes of Taxation.
5. Is Donee’s Tax the same as Donor’s Tax?
6. Is it possible to tax both the donee and the donor?
7. Supposing your boyfriend gave you a house and lot through oral donation, is it still
subjected to Donor’s Tax?
8. Is the donation void is it still subjected to Donor’s Tax?
9. When will the payment of Donor’s Tax be paid? Upon actual delivery of the property
or the fulfillment of the condition?
10. What happens if there is a violation on the condition? Should there be a refund?
(boyfriend problem)
11. How do you compute the donor’s tax according to the train law?
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AMENDED: 6% starting January 1,2018
Answer: Gross Gifts – Allowable Deductions = Net Taxable Gifts
(Net Taxable Gifts – 250,000) x 6% = Donor’s Tax Due
Donor’s Tax Due – Tax credits = Donor’s Tax Payable **
12. What are invalid donations?
13. What are deductions for purposes of determining the net gift?
14. Take note of deduction and exemptions. These are two different things.
15. What is the tax base for the computation of Donor’s Tax?
16. if you’re dad gave you a lot and it was mortgaged, are you supposed to deduct the
mortgaged attached to the property to arrive at the next gift?
17. if the conditions have cost, say you have to pay loan or mortgage or you have to set up a
multi purpose hall on the land (church problem), does this mean the donor should pay tax on the
amount of the whole property?
18. discuss computation of donor’s tax between husband and wife? Will it be computed
separately? Should the cumulative method be applied?
19. is the exemption of the 250,000 per annum? Or per donation?
20. where is the jurisdiction based? (payment of taxes)
21. ex: donee and donor are abroad but the property is located in the Philippines, where should
you pay the tax?
ASSIGNMENT FOR NEXT MEETING – VALUE ADDED TAX. Secs 105-108. PLEASE
MEMORIZE.
FINAL NOTES:
With regards to estate and donor’s tax, these are transfer taxes. They are both gratuitous. There
are two kinds of transfer taxes:
1) Death taxes
A. Estate tax – to be paid by the estate of the decedent
B. Inheritance tax – to be paid by those who inherited
This is double taxation, but it is not obnoxious. It is indirect double taxation—legal. It is
imposed on different parties.
There was a time that both of them are imposed. There is nothing obnoxious about it.
We did away with the inheritance tax because it is difficult to collect/implement.
2) Gift Tax
We did away with donee’s tax. There’s no finality. We only have donor’s tax now.
QUESTION TO RESEARCH:
Supposing a and b are alumni of san beda Alabang, both of them are rich, successful in their
careers let’s say A was given 7 days to live and tomorrow is the 7th day. Today, which is the 6th
day, he made a will giving sbca a property worth 1M. on the other hand, B, who is also rich,
decided to give also. He will give sbca a similar property of similar value (1m) to be donated
tomorrow, which is the 7th day of A.
Who between A and B are more mayabang?
A – through a will
B- through donation
PREPARE ANSWERS FOR NEXT MEETING. CAN BE ASKED IN THE FINAL EXAMS.
Remember that the rate is now 6%.