From the gross value of the property donated to

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from the gross value of the property donated to arrive at the value of the net gift, the basis in the computation of the donor’s tax. The following are also deductible from the value of the property donated: 1) Encumbrance on the property donated if assumed by the donee (e.g., where the donee of a mortgaged real property worth P500,000 assumes the mortgage indebtedness of the donor in the amount of P100,000); and 2) Those specifically provided by the donor as diminution from the property donated (e.g., where the donation is subject to the condition that the donee would give P50,000 to charity). Filing of Return and Payment of Tax
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Except where the transfer by gift is exempt from a tax, a donor’s tax return under oath is required by law to be filed for purposes of the donor’s tax. 1) When – The return shall be filed within 30 days after the date the gift is made. The tax is paid at the time the return is filed within said period. 2) Where- Except as the Commissioner of Internal Revenue otherwise permits, the return shall be filed with an authorized or accredited agent bank (AAB), Revenue District Officer, Revenue Collection Officer or duly authorized Treasurer of the city or municipality where the donor was domiciled at the time of the transfer or if there be no legal residence in the Philippines, with the Office of the Commissioner of Internal Revenue. In the case of gifts made by a nonresident, the return may be filed with the Philippine Embassy or Consulate in the country where he is domiciled at the time of the transfer, or directly with the Office of the Commissioner. 3) Contents- The return shall set forth: a) Each gift made during the calendar year which is to be included in computing net gifts; b) The deductions claimed and allowable; c) Any previous net gifts made during the same calendar year; d) The name of the donee; and e) Such further information as may be required by rules and regulations made pursuant to law. Revenue Regulation No. 2-2003 requires that the return shall also state the relationship of the donor to the donee. (Sec 13 [A] thereof) 4) Copies- The return shall be filed in triplicate, two(2) copies for the BIR and one (1) copy for the taxpayer. (see Sec. 104)
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A. IN GENERAL Donor’s tax will be levied, assessed, collected and paid upon the transfer by any person, resident or nonresident, of the property by gift The property can be real or personal, tangible or intangible The transfer can be in trust or otherwise The gift can be direct or indirect The donor’s tax shall not apply unless and until there is a completed gift. The transfer of property by gift is perfected from the moment the donor knows of the acceptance by the donee; it is completed by the delivery, either actually or constructively, of the donated property to the donee. Thus, the law in force at the time of the perfection/completion of the donation shall govern the imposition of the donor’s tax.
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  • Winter '17
  • Dean Tony La Vina
  • Taxation in the United States, donor

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