CHAPTER 8
EXEMPTIONS OF CERTAIN GIFTS AND OTHER DEDUCTIONS FROM
GROSS GIFTS
1. Dowries or gifts made on account of marriage of children shall be exempt from donor’s
tax if given by parents:
I- Before its celebration.
II- Within one year thereafter.
a. Both I and II are correct
b. Neither I nor II is correct
c. Only I is correct
d. Only II is correct
2. The amount of the exempt dowry is to the extent of the first:
a. P32,000
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b. P25,000
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c. P20,000
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d. P10,000
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3. One of the following is an incorrect statement regarding dowry.
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a. The donor must be the natural or adopting parent of the child.
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b. The done must be a legitimate
c. The dowry or gift on account of marriage must be given before the celebration of the
marriage or within two (2) years thereafter.-1 yr
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d. The exemption allowed is to the extent of the first P10,000.
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4. One of the following will not entitle the donor parent to a P10,000 dowry exemption.
a. Legitimate child
b. Recognized natural child
c. Adopted child
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d. None of the choices
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5. A married couple donated a conjugal property to their son who is getting married. Which
of the following statements is incorrect in connection with the donation.
a. The husband is the proper claimant of the dowry, being head of the family.
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b. The husband and wife shall file two separate donor’s tax returns.
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c. The husband and the wife can claim P10,000 dowry each.
d. The gross gift of the husband shall be one half of the value of the donated conjugal
property.
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6. A donation on account of marriage will give the donor a deduction from the gross gifts
made if the done is:
a. A legitimate child
b. A stepchild
c. The son of the donor’s second cousin
d. The legitimate father of the donor
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7. Which of the following gifts or donation shall be exempt from the donor’s tax?
I- Those made to or for the use of the National Government or any entity created by
its agencies which is not conducted for profit.
II- Those made to any political subdivision of the Government.
a. I only
b. II only
c. Both I and II
d. Neither I or II
8. First statement: Transfers inter vivos in favor of non profit educational institutions are
exempt from donor’s tax.
Second statement: Transfers mortis causa in favor of non profit educational institutions
are exempt from estate tax.
a. True, True
b. False, False
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c. True, False
d. False, True
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9. Mr. J Cruz donated P200,000 to a religious institutions. During the year, the total receipts
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from donations of the religious institutions was P5,000,000. Its total administrative
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expenses amounted to P2,000,000. How much was the exempt gift to the religious.
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a. Zero
b. P10,000
c. P100,000
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d. P200,000
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10. Since donation to a charitable institution has no ceiling as a deduction for donor’s tax
purposes,
1st statement: the net gift will be zero, so that in computing the donor’s tax, the donation
may be omitted in gross gifts if it is likewise omitted in deductions.
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2nd statement: The gross gifts shall be reported and the deduction shall be claimed.
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a. Both statements are true
b. Both statements are false
c. First statement is true while second statement is false
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d. First statement is false while the second statement is true
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11. One of the following is not an exempt gift or a deduction from the gross gift of a non
resident alien donor.
a. Dowries or gifts made on account of marriage.
b. Gift made to or for the use of the national Government or to any of its political
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subdivision.
c. Gifts in favor of an educational and/ or charitable, religious, cultural or social welfare
corporation, institution, accredited on government organization, trust or philanthropic
organization or research institution or organization.
d. Encumbrance on the property donated, if assumed by the done
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12. A married non resident alien donates shares of stock valued at P300,000 to his son who is
getting married to a Filipina in the Philippines. Assuming there is reciprocity, how much
is the gross gift and the exempt dowry?
Gross Gift Dowry
a. P300,000 P10,000
b. P300,000 Zero
c. P150,000 Zero
d. Zero Zero
13. Which of the following is not a deduction from the gross gifts?
a. Unpaid mortgage on the donated property assumed by the done
b. Unpaid real estate tax on the property donated assumed by the done
c. Diminution on the donated property specifically provided by the donor
d. Unpaid donor’s tax on the donated property assumed by the donee
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14. Which of the following is a taxable gift?
a. Donation to the Intramuros Administration
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b. Donation to the Community Chest
c. Donation to the Philippine Institute of Certified Public Accountant
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d. Donations to International Rice Research Institute
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15. (Phil. CPA) The following are exempt from the donor’s tax. Which is the exception?
a. P200,000 cash given by a non resident alien donor to his legitimate son who is getting
married in the Philippines to a Filipina.-outside the PH
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b. P10,000 cash given by a resident by a resident alien to his legitimate son who is
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getting married in the Philippines.
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c. Donation of a condominium in Hongkong to a Filipina by a British national not
residing in the Philippines.
d. P150,000 donation to a non profit school.
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16. A resident citizen of the Philippines made the following donations on one date:
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Donations on account of marriage:
To legitimate son P100,000
To a legitimate daughter and her
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Husband to be, on account of marriage 15,000
To a recognized natural son 30,000
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To an adopted child 60,000
To an illegitimate daughter 40,000
To a sister 12,000
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To a charitable institution 20,000
The deduction from gross estate is:
a. P67,500
b. P60,000
c. P57,500
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d. P30,000
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