a legitimate child.

Multiple Choice Theory: Part 1

1. A gross gift is valued at the date of

a. death of the donor.
b. notarization of the donation.
C completion or acceptance of the donation.
d. payment of the donor's tax

2 A donation of real property is valued at

a. zonal value of the property.
b. value per tax declaration.
c.
C. independent appraisal value.
d. the higher of zonal value or value per tax declaration.

3. Which type of donation is exempt?

a. Renunciation of the right to collect an indebtedness of a debtor
b. General renunciation of inheritance by an heir
C. Transfer for an insufficient consideration
d. Irrevocable donation in trust

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 Chapter 17-Donors Tax

4. The donation of preferred stocks are valued at

a. Book value
b. Par value
C. Second-hand value
d. Independent appraisal value

C 5. For purposes of donor's taxation, the fair value of common stocRS 1S

determined as its book value using the

a. Asset appraisal method
b. Independent appraisal method
C. Adjusted net asset method
d. Market price averaging method

6. Which is correct regarding donation of common properties?

a. Both spouses shall file separate donor's tax returns
b. Either spouse shall file a donor's tax return.
C. The spouses shall file a consolidated donor's tax return.

d. Any of these at the discretion of the spouses

considered
7. The donation of common property shall be
one-half made by the wife.
a. one-half made by the husband and
the deed of donation.
b. totally made by the spouse signing
both spouses.
C. void unless with the consent of
donation made by the head of the family.
d.
donees are treated as
8. Donations of properties to joint
donor's tax return.
be reported under a separate
a.
a. separate donations to to the
donee which will be classified according
b. donations to each
relation of each donee to the donor.
donor's
C. a donation to a partnership;
hence, these are subject to 30%
tax.
donor's tax return.
d. a single donation which will be reported in a single

9. Which of the following donations is taxable?

a. Donation to an accredited charitable institution
b. Donation to an association
C. Donation to an educational institution accredited by CHED
d. All of these

10. Which of the following obligations, even if assumed by the donee, is r

deductible from gross gift?
a. Mortgage payable c. Donor's tax
b. Real property tax d. All of these
Chapter 17-Donor's Tax

11. Which of these donations to a non-profit institution are exempt from

donor's tax?
a. Donations restricted by the donor for salaries of staff of the non-profit
institutions
b. Donations restricted by the donor for utilities expenses of the non-
profit institutions
C. Donations restricted by the donor to be used only for program
expenses of the non-profit institution to carry out its organizational
mission
d. All of these

12. Non-resident alien donors can deduct any of the following, except
a. dowry exemption.
b. obligation assumed by donee.
C. donation to the government.
d. donation to an accredited non-profit institution.

13. Obligations, if assumed by the donor, are

a. deductible by residents or citizens.
b. deductible by non-resident aliens.
C. deductible by any donor.
d. never deductible.

14. Dowry exemption is not allowed for

a. adopted children.
b. recognized natural children.
C. illegitimate children.
d. None of these

15. Statement 1: Where property is transferred

during a person's lifetime for
less than adequate and full consideration in money or money's worth, then
the amount by which the value of the
property exceeded the value of the
consideration shall, for the purpose of the donor's tax, be deemed a
Statement 2: Encumbrance on the
gift.
property donated, if assumed by the
donor, is deductible for donor's tax purposes.

Which is true?
a. Statement 1 c. Both statements
b. Statement 2 d. Neither statement

Multiple Choice Theory: Part2

1. Statement 1: Donations abroad are exempt from donor's tax to an alien
donor.
Statement 2: Donations in the
donor. Philippines are exempt to a non-resident

590
 Which is false?
a. Statement 1 c. Both statements
b. Statement 2 d. Neither statement

A
2. Which is correct regarding the exemption of donation to non-stock and
non-profit institutions?
a. It must be made to accredited institutions only.
b. It must be made to bona fide non-profit institutions, whether
accredited or not.
C. The donor must be a resident or a citizen of the Philippines.
The property donated must be situated in the Philippines at
the date of
d.
d.
donation.
basis.
3. Donations in the tax return is presented on a cumulative year-to-date
This is true to
a. Donations to relatives only
b. Donation to strangers only
C. Both donations to relatives and donations to strangers
C.
d. Donations made in the Philippines only

the applicable tax law at

Statement 1: Donor's tax rates vary depending on

the time of gift.

Statement 2: The law in force at the time of completion or perfection of the
gift shall govern the contract of donation.
Which is correct?
a.
a. Statement 1 c. Both statements
b. Statement 2 d. Neither statement
b.

Which of these donations to the government are subject to donor's tax?

a.
Donations of tankS and ammunitions to the Philippine military
b.
b. Donations
C. Donations ofto computers to the Department
government-owned of Education
and controlled corporations
C.
d. None of these

C 6. Counted from the date of donation, the donor's tax is paid within
a. 10 days. C. 30 days.
b. 15 days. d. 60 days.

7. Which is not a required disclosure in the donor's tax return?

a. Current and past gifts during the year
b. Donations made last year
C. Name of the donee
d. Deductions claimed
 DOnor S Tax

C Which is not included in gross gift?

a. Transfers to the government
b. Transfers to non-profit and non-stock charitable institutions
C. Portion of the fair value of the property adequately paid ror
d. Portion of the donation representing dowry
D9. Which of the following is included in net gift?
a. Transfers to the government
b. Transfers to non-profit and non-stock charitable institution
C. Portion of the donation representing dowry
d. Excess of the fair value of the property over the consideration paid by
the donee

10. Which of these

is reflected in net gift?
a. Dowry to a step-child
b. Gift to a spouse
C. P100,000 gift to relatives
d. Obligations assumed by the donee

A 11. Under the law, the donor's tax return shall be filed in
a. duplicate. c. Quadruplicate.
b. triplicate. d. quintuplicate.

12. Which is not entitled to claim tax credit for foreign donor's tax paid?
a. Resident alien C. Non-resident citizen
b. Resident citizen d. Non-resident alieen

13. The donor's tax may be paid to the following except

a. An authorized agent bank
b. Revenue district officer
C. Revenue collection officer
d. Barangay treasurer

14. If there is no BIR office in the place of the donor's residence, the donor's tax
return shall be filed with the
a. office of the Commissioner.
b. revenue district officer.
C. revenue collection officer.
d. authorized municipal treasurer.

15. Where the donor has no residence in the

Philippines, the donor's tax return
shall be filed with
a. the office of the President.
b. the office of the Commissioner.
C. an authorized government depositary bank near the residence of the
donee.
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 Chapter 17- Donor's Tax

d. the Revenue District Office having jurisdiction over the place where the
donee is located.

16. Which of these donations to the Philippine government is subject to donors

tax if the donor is a resident?
a. Donation of properties located abroad
b. Donation of properties located in the
C. Both A and B
Philippines
d. Neither A nor B

17. Which of these donations to the Philippine government is subject to donors

tax if the donor is a non-resident alien?
a. Donation of properties located abroad
b. Donation of properties located in the Philippines
C. BothA and B
d. Neither A nor B

18. Which of the following properties, when donated, are not subject to donor's
tax to the wife?
a. Capital properties
b. Paraphernal properties
C. Common properties
d. B andC

Multiple Choice - Problems: Part 1

1. Mr. and Mrs. Gaspar donated a piece of land to Mr. Lee in accordance with
the wishes of Don Silvano, Mr. Gaspar's father. Don Silvano donated the
property to Mr. Gaspar as the first donee with Mr. Lee as the second donee.

Which is correct?
a. Only Mr. Gaspar shall file the donor's tax return.
b. Both Mr. Gaspar and Mrs. Gaspar shall file separate donor's tax return.
C. The gift is exempt from donor's tax.
d. Mr. Lee shall file the donor's tax return.

12. Eddie donated P 100,000 to an accredited charitable institution to cover

administrative expenses of the latter. Which is correct?
a. Eddie shall pay P30,000 donor's tax.
b. The donation is exempt because the donee is an accredited charitable
institution.
C. The donation is exempt because it does not exceed P100,000.
d. The donation is subject to the tax using the donor's tax table.

3. James was indebted to Juan for P500,000. Out of compassion to his brother
James, Pedro assumed and paid James' obligation.

593
 Which is correct?
a. James shall report the P500,000 as gross income
b. James shall report the P500,000 in his donor's tax.
C. Pedro shall report the P500,000 as donation and pay the donor's tax.
d. Both James and Pedro shal file a donor's tax return.

4 In 2015, Mr. Mabait made a single donation of P 90,000 cash to Mrs. Malait,
his half-sister. Which is correct?
a. The donation is subject to 30% tax.
b. The donation is exempt from donor's tax.
C. The donation is subject to progressive donor's tax.
d. Mrs. Malait shall pay the donor's tax.

5. In 2015, Mr. and Mrs. Mapagbigay made a single donation of P200,000 to

their son on account of his graduation from college. The donation was taken
from the salaries of Mr. Mapagbigay.

Which is correct?
a. The donation is exempt from donor's tax.
b. The donation shall be subject to income tax.
C. Both spouses will pay donor's tax.
d. Either of the spouses pays the donor's tax.

6. In 2015, Roy transferred P 200,000 to his younger brother, Lee, and

stipulated that the P50,000 of the donation shall be given to Jayrick.

Which is true?
a. The donation is exempt from donor's tax.
b. The donation to Lee is subject to donor's tax, but the donation to
Jayrick
is exempt.
C. The donation to Jayrick is exempt, but the donation to Lee is taxable.
d. Both donations are subject to donor's tax.

7. Jay donated P1,000,000 to the Autism Foundation, an accredited social

welfare institution. Jay stipulated that 1/4 of the donation shall be given to
Cancer Survivor Society, another accredited non-profit institution.
a. The entire P1M donations are exempt from donor's tax.
b. The entire P1M donation shall be subject to donor's tax.
C. P750,000 donation shall be subject to donor's tax.
d. P250,000 donation shall be subject to donor's tax.

8. Ms. Kris gave her longtime best friend and ABS-CBN Kapamilya co-host, Mr.
Abunda, a Hummer worth P14M. Which is correct?
a. The donation is a donation made between
strangers subject to 30% tax.
b. The donation is exempt from donor's tax.
C. The donation is subject to donor's tax at
progressive rates.
 Chapter 17- Donor's Tax

d. The donation is a reportable item of gross income by Mr. Abunda.

9. Mr. Realty, a VAT taxpayer, transferred a commercial lot to his son

wedding gift. The lot was worth P1,000,000 at the time of donation
Which is incorrect?
a. The transfer is subject to VAT.
b. The transfer is subject to
capital gains tax.
C. The transfer is subject to donor's tax.
d. All of these

10. Mr. and Mrs. Aguinaldo donated a piece of land worth P500,000 to their
daughter, Hanna, who is getting married. Hanna is a child of Mr. Aguinaldo
from a prior marriage.

Which is correct?
a. Mr. Aguinaldo shall report a net gift of P250,000.
b. Mrs. Aguinaldo shall report a net gift of P240,000.
C. Mr. Aguinaldo shall compute his donor's tax using the donor's tax table.
d. Both Mr. and Mrs. Aguinaldo shall claim deductions for dowry
exemption.

11. Mrs. Henson donated P400,000 to his stepdaughter. Which is correct?

a. Henson's net gift shall be P400,000 subject to progressive tax.
b. Henson's net gift shall be P390,000 subject to progressive tax.
C. Henson's net gift shall be P400,000 subject to 30% donor's tax.
d. Henson's net gift shall be P390,000 subject to 30% donor's tax.

12. After receiving P300,000 repayments from a P500,000 promissory note, the
creditor cancelled the balance of his debtor sister-in-law.

What is the correct presentation of the foregoing in the donor's tax return?

Relatives Stranger
a. P 0 P 200,000
b. P 200,000 P 0
C. P 300,000 P 0
d. P P 0

13. Miss Gelen wanted to help her brother who is financially challenged. She
donated an agricultural land worth P1,000,000 and designated her brother
and sister-in-law as donees.
 ation in
Which of the following properly depicts the reporting of the donation in the
the

donor's tax return?

Relatives Strangers
P 0
a. P1,000,000
b. P 500,000 P
C. P 500,000 P 500,000
d. P 0 P 0

14. Mr. and Mrs. Teban donated a commercial lot as dowry to their daughter
The commercial lot is a conjugal property valuing P800,000 at the date of
donation.

Which of the following properly depicts the presentation of the donation in

the donor's tax return of Mr. Teban?

Relative Stranger
a. P 800,000 P 0
b. P 400,000 P 0
C. P 400,000 P 400,000
d. P120,000 PO

15. Don Nicodemo donated an agricultural land to his granddaughters, Mara

and Clara. The property was worth P1,000,000 at the date of donation.

Which of these is the correct presentation of the donation in the donor's tax
return?
Relatives Strangers
a. P 1,000,000 P 0
b. P 500,000 P
C. P 500,000 P 500,000
d. P 0 P 0

16. Mr. and Mrs. Manolo donated a

property which Mr. Manolo
the marriage. Which is incorrect? inherited during
a. There is only one donor in the
donation.
b. Mr. Manolo shall file a donor's tax
return.
C Mrs. Manolo shall not file a donor's tax return.
d. Both spouses shall file
separate donor's tax returns.
 Chapter 17- Donor's Tax

17. Mr. and Mrs. Miranda donated a car from the sole salaries of Mrs. Miranda.
Which is correct?
a. There is only one donor in the donation.
b. Only Mr. Miranda is required to file a donor's tax return.
C. Only Mrs. Miranda is required to file a donor's tax return.
d. Both spouses shall file separate donor's tax returns.

C Multiple Choice - Problems: Part 2

1. Mr. Alfonso donated a brewery with a value of P24M to Mr. Ginebra. Mr.
is the
Ginebra assumed the mortgage on the property valuing P18M. What
amount to include in net gift?
a. P 24M c.P6M
b. P 18M d. P0

worth P1,000,000 to Bolatsing

2. Magaling Company donated a commercial lot which was
The lot was encumbered by a P400,000 mortgage
Company. accrued property tax
assumed by Magaling. The property had P100,000
be
which Bolatsing assumed. The net gift shall
a. P1,000,000 c.P 600,000
b. P 900,000 d. P 500,000

had zonal
Philippine government. The lot
a
3. Anderson donated a lot to the
encumbered by a P1,000,000 mortgage. What
value of P4,000,000 and was
the donation?
is the net taxable gift on
a. P0 c.P3,000,000
b. P 1,000,000 d. P 4,000,000

to his son as dowry for his

donated P100,000
4. On July 1, 2016, Mr. Carrion to his
also gave another dowry of P100,000
upcoming marriage. He
married last April 30, 2015.
daughter who got

What is correct?
a. Mr. Carrion shall report a P90,000 net gift.
b. Mr. Carrion shall report a P180,000 net gift.
C. Mr. Carion shall report a P190,000 net gift.
d. Both donations are exempt.

5. Henrie donated 20,000 common stocks of Quickie Birds Corporation. At the

date of donation, Quickie Birds Corporation had the following:

Net assets P 2,000,000

Outstanding common stocks 100,000
 Per financial statements disclosures, Quickie had certain assets with fair
value exceeding their book values by a total of P1,200,000.

Compute the amount to be reported in gross git.

a. P 200,000 c. P 400,000
b. P540,000 d. P 640,000

6. Bruno had 12,000 in the stocks of Jonas Corporation. The published

financial statement of Jonas nearest the date of donation reveals the
following:
Total assets at fair value P 2,000,000
Total assets at historical cost 1,500,000
Total liabilities 800,000
Outstanding common stocks 100,000
The donation shall be valued at
a. P 60,000 c.P 144,000
b. P84,000 d.P 180,000

7. Mr. and Mrs. Julio transferred the following properties in 2016:

P400,000 cash to daughter, Jane, as a graduation gift
P600,000 land to son, Eugene, who is scheduled to wed next year
P300,000 car to Horace, Mr. Julio's best friend, as a wedding gift

What is the respective net gift of Mr. and Mrs. Julio to relatives?
a. P1,000,000; P0
b. P500,000; P500,000
C. P480,000; P480,000
d. P490,000; P490,000

8. What is the respective net gift of Mr. and Mrs. Julio to strangers?
a. P300,000; P 0
b. P0; P300,000
C. P 150,000; P150,000
d. P140,000; P140,000

9. Shanon donated property valued at P500,000 to his half-sister who is

a

getting married. Shanon designated the donation to the new

property has P 100,000 mortgage which the donees spouses. The
agreed
to assume.
What is the respective net gift to a
a. P0; P400,000
strangers and a relative?
b. P0; P390,000
c.P200,000; P200,000
d. P 200,000;
P190,000
Chapter 17- Donor's Tax

10. Mr. and Mrs. Crockie

donated one of their residential houses
wortn
P2,000,000 to Rey, their common child, who just got married to May. Mr.
and Mrs. Crockie
designated the property to the new spouses, Rey and Ma
Compute the respective net gifts of Mr. and Mrs. Crockie to relatives.
a. P490,000; P 500,000
b. P490,000; P490,000
C. P990,000; P 990,000
d. P1,000,000; P1,000,000

11. Compute the respective net gifts of Mr. and Mrs. Crockie to strangers.
a. P0; P0
b. P 490,000; P490,000
C. P500,000; P500,000
d. P 1,000,000; P1,000,000

12. Andro donated the following properties:

P2,000,000 car on November 2, 2013 to his favorite nephew
P3,000,000 agricultural lot on January 5, 2014 to his son who is getting
married
P4,000,000 building on February 14, 2014 to his father who is getting
married
P 5,000,000 cash on July 1, 2014 designated by Andro for the
administrative expenses of a charitable institution
P1,000,000 cash on August 1, 2015to his mother-in-law

Compute the total taxable donation in 2014.

a. P15,000,000 c. P11,990,000
b. P12,000,000 d. P 7,000,000

13. During the celebration of his second marriage on February 14, 2015, Mark
made a donation of P500,000 to his daughter to appease her to be in good
terms with his new wife.

Compute Mark's net taxable gift.

a. P500,000 c. P 250,000
b. P 490,000 d.P 240,000

Multiple Choice Problems: Part 3

1.
1. Antonio had a net gift of P150,000 to his first cousin. What is the donor's
tax?
a. P1,000 c. P 42,000
b. P 3,000 d. P 45,000

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 Chapter 17- Donors Tax
2. Jose donated lot worth P400,000 to his second cousin subject to the
a
condition that his cousin assume the P
40,000 accrued real property tax on
the lot. What is the donor's tax?
a. P 10,000 c.P 108,000
b. P8,400 d.P 120,000

3. A donor made the

following donations din 2016:
Net gift to strangers P 40,000
Net gift to relatives 100.000
Total net gift P 140,000
Compute the total donor's tax due.
a. P0 c.P 12,000
b. P 800 d.P42,000
In 2014, Andy made a total donation of P350,000, inclusive of P80,000
donations to strangers. Compute the total donor's tax due.
a. P4,800 c. P 28,800
b. P 24,000 d. P 32,000

5. Derrick made the following donations in 2016:

January 5, 2016-cash, to sister P 250,000

August 17, 2016 - Iphone 6, to girlfriend
150,000
November 8, 2016 -

Stocks, to granddaughter 400,000

Derrick's donation to the granddaughter is made on account of the latter's
marriage.

Compute the gift tax on the January 5 donation.

a. P 2,000 c. P45,000
b. P 4,000 d. P75,000
C 6. Compute the gift tax on the August 17 donation.
a. P 6,000 c. P 45,000
b. P 10,000 d.P 116,000

7. Compute the gift tax on the November 8 donation.

a. P19,000 c. P 28,000
b. P 22,000 d. P 32,000

8. Mr. Kim Chi, non-resident Korean donor, donated a car in the

a
worth P500,000 to his resident Filipino best friend. Mr. Chi Philippines
donor's tax abroad. paid P50,000

COO
Chapter 17 - Donor's Tax

What is the donor's tax due and payable in the Philippines?

a. P150,000
b. P 100,000
c.P14,000
d. P0

9. Mr. Kinoto, a non-resident Japanese, donated an agricultural land in Japan

worth P800,000 to a non-resident Filipina girlfriend. Mr. Kinoto paid
P20,000 donor's tax in Japan. What is the donor's tax due and payable in the
Philippines?
C. P 240,000 c.P14,000
d. P 220,000 d.P0

10. A non-resident citizen made the following donations in 2015:

July 1, 2015 P 200,000, to a non-resident Japanese girlfriend, paid
P30,000 donor's tax abroad
August 28, 2015 P 310,000, dowry to his daughter who is getting
married in the Philippines
What is the donor's tax to be paid respectively on the July donation and
'August donation?
a. P30,000; P6,000 c. P 0; P14,000
b. P0; PO d. P60,000; P6,000

11. What is the required donor's tax due and payable in the annual adjustment
return?
a. PO c.P 11,400
b. P3,600 d. P 45,000

12. A resident alien made the following donations during the year to relatives:

Net gift in the Philippines (paid P 24,000 donor's tax) P 700,000

Net gift abroad (paid P18,000 donor's tax abroad) 300.000
Total net gift P 1.000,000
What is the donor's tax due and payable?
a. P44,000 c.P6,800
b. P 26,000 d.P0

13. Manso, resident citizen, donated several properties during the year:

Net gift in the Philippines P 0

Net gift made abroad 500.000
Total global net gift P 500,000
Gift tax paid abroad P 10,000
 Chapter 17- Donor's Tax

What is the donor's tax due and payable in the Philippines?

a. PO c. P 10,000
b. P4,0000 d. P 14,000

14. Armando made the following donations to relatives on December 31, 2015:

Net gift Tax paid

Finland P 2,000,000 P 110,000
Norway 1,500,000 120,000
Philippines 500,000

There are no other donations during the year.

Compute the donor's tax due and payable.
a. P 304,000 c. P74,0000
b. P 80,000 d. P 38,000

15. The following relate to a non-resident citizen donor:

Net gift Tax paid

Japan relatives P 2,000,000 P 60,000
Malaysia - stranger
1,500,000 200,000
Philippines- relatives 500,000
The donor paid P354,000 donor's tax
during the year.
Compute the donor's tax due and payable at year-end.
a. PO C. P 64,000
b. P 60,000 d.P 78,250