BUSINESS AND TRANSFER TAXATION 6th Edition (BY: VALENCIA & ROXAS) 40
SUGGESTED ANSWERS

Chapter 6: DONOR’S TAX

CHAPTER 6

DONOR’S TAX

Problem 6-1 1. False – during the lifetime of the donor. 2. True 3. True 4. False – there is no consideration in donation. 5. True

6. False – It is enough that the duly representative of the incapacitated donee to receive the donation. 7. True 8. False – Real property donation must be put in writing regardless of value. 9. True 10. False – The value of donated personal property must exceed P5,000.

11. True 12. True 13. False – not gifts. 14. False – constitutes dividend income. 15. True

Problem 6-2 1. False – dowry is not allowed to nonresident alien donor.

2. False – the donee’s identity is not material to make the donation valid. The donor can make donation to an unborn child.

3. True 4. True

5. False – If resident alien donates, he shall be subject to donor’s tax in the Philippines for his properties within and outside the Philippines

6. True 7. True 8. True 9. False – only one-half of the share is donated. 10. False – only if the gift is on account of marriage. 11. False – only the first P100,000 is exempt. 12. False – may be subject to business tax such as VAT, custom duties, or excise tax. 13. False - When the donee is a stranger, the tax rate is 30%. 14. True 15. False - excise tax – the tax is imposed on the act to transfer property by way of gift inter vivos.

Problem 6-3 | Problem 6-4 | Problem 6-5 | 1. | B | 1. | A | 1. | C | 2. | D | 2. | C | 2. | D | 3. | A | 3. | D | 3. | A | 4. | D | 4. | C & A | 4. | B | 5. | A | 5. | A | 5. | A | 6. | A | 6. | C | 6. | D | 7. | C | 7. | D | 7. | A | 8. | B | 8. | A | 8. | A | 9. |