DONOR’S TAX

 It is an excise (privilege) tax, PROPERTIES INCLUDED IN THE TERM

imposed on the privilege of the donor
to give or on the privilege of the
donee to receive. It is not a tax on
the property as such, because its
imposition does not rest upon general
ownership.
 The tax is imposed without
reference to the death of the donor
unlike in the case of estate tax.
DOANTION/ GIFT
 An act of liberality whereby a
person disposes gratuitously of a
thing or right in favour of another who
accepts it.
GIFTS
(A). In the case of resident citizens, non-
resident citizens and resident aliens:
1.) Real property within and without the
Philippines.
2.) Tangible personal property within and
without the Philippines; and
3.) Intangible personal property within and
without the Philippines.
(B.) In the case of non-resident aliens:
1.) Real property within the Philippines.
2.) Tangible personal property within the
Philippines.

DISTINCTION BETWEEN DONOR’S TAX 3.) Intangible personal property within the
AND ESTATE TAX Philippines, unless there is reciprocity in
which case, it is not taxable.

DONOR’S TAX ESTATE TAX

FACTORS AFFECTING LIABILITY FOR
Tax on the privilege Tax on the privilege
to transmit property to transmit property GIFTTAXES
during the lifetime upon one’s death.
of the donor.
Exemption is only Exemption 1.) Relationship of the donor and the donee
P100,000.00 isP200,000
Notice of donation Notice of death is  When the donee is considered a
is generally not required. stranger to the donor, the donor’s tax
required. shall be 30% of the net gifts.
Extension of Extension of
payment is not payment may be  When the donee is a relative of the
provided. granted by the donor, the tax shall be based on the
Commissioner of 2-15% table under Sec. 99(A).
Internal Revenue
Payable within 30 Payable within 6  Contribution in cash or in kind to any
days from the date months from the candidate, political party or
of gift date of death coalition of parties for campaign
Imposed on the net Imposed on the net
shall be governed by the Election
gift estate
Code.
 3. The child must be either the legitimate,
recognized natural or legally adopted
 A Stranger is:
child of the donor, and;
1.) One who is not a:
4. It must be given before or one year after
(a) brother/sister (whole or half- the celebration of the marriage.
blood), spouse, ancestor and lineal
descendant
B.) Gifts made to or for the use of the
(b) Relative by consanguinity in the
National Government or any of its agencies
collateral line within the fourth
which is not conducted for profit, or to any
degree of relationship
political subdivision of the said government.
2.) Donations made between individuals
and business organizations are
considered donations to strangers C.) Gifts in favor of educational, charitable,
religious, cultural or social welfare
3.) Donations made between business
corporation, institutions, foundations, trust or
organizations are considered donations
philanthropic organization, research
made to strangers
institution or organization, or accredited non-
government organization. Provided, that no
more than30% of said gifts shall be used by
 Note: Donees who have no blood such donee for administration purposes.
relation to the donor are considered
strangers to the donor, such as those
made to one’s in-laws or to
 Gifts made by a Non-Resident
juridical persons.
Alien

DEDUCTIONS/ EXEMPTIONS FROM GIFT

TAX
 Gifts Made by a Resident:
A.)Dowries or gifts made on account of
marriage before its celebration or within one
year thereafter by parents to each of their
legitimate, illegitimate or adopted children to
the extent of the first P10, 000.
 Requisites:
1. The donation must be given on account
of marriage.
2. The parent must give it to his child.
A.) Gifts made to or for the use of the
National Government or any entity created
by of its agencies which is not conducted
for profit, or to any political subdivision of
the said government.
B.)Gifts in favor of educational, charitable,
religious, cultural or social welfare
corporation, institution, foundations trust or
philanthropic organization, research
organization or institution. Provided, that no
more than 30% of said gifts shall be used by
such donee for administration purposes.
TAX TREATMENT OF PROPERTIES
TRANSFERRED FORLESS THAN FULL/
ADEQUATE CONSIDERATION
 General Rule: The amount by which
the FAIR MARKET VALUE of the
property exceeded the value of the
consideration shall be deemed a gift
 Exception: Real properties
classified as capital assets (not used
in business) as there were already
subjected to Capital Gains Tax.
 Note: Void Donations are not
subject To Donor’s Tax. Such as:
1.) Between husband and wife, even if the
relationship has not been solemnized.
2.) Between persons guilty of adultery or
concubinage.
3.) Between those found guilty of the same
criminal offenses.
4.) Between those made to a public officer or
his wife, descendants, ascendants by reason
of his office.
NET GIFT
 The total amount of gifts less the
allowable deductions and specific
exemptions.
 the total net gifts made during the
SAME calendar year is used as
basis for computing the donor’s tax
VALUATION
 The gift tax is based on the fair
market value of the gift at the time it
was given.
Time and place of filing and payment
 30 days after the date the gift is
made
 Tax due shall be paid on the time of
filing
 Authorized Agent Bank, Revenue
District Officer, Revenue
Collection Officer, duly authorized
Treasure of the city or municipality
where the donor was domiciled at the
time of transfer.
 Note: If there is no legal residence
in the Philippines, with the Office of
the Commissioner.
 Gifts made by a non-resident,
return may be filed with the
Philippine Embassy or Consulate
or with the Office of the
Commissioner
CONTENTS OF THE RETURN
1.) Gifts made during the calendar year,
2.) Deductions claimed and allowed,
3.) Previous net gifts made during the year,
4.) Name of the donee. Relationship of the
donor and the done,
6.) Other information as may be required.