Bureau of Internal Revenue
Republic of the Philippines


Tax Information


Donor's Tax

Estate Tax
Income Tax
Percentage Tax
Value-Added Tax
Withholding Tax
Excise Tax
   


 

 

 


DONOR’S TAX

Contents

Description
Tax Forms

Documentary Requirements
Tax Rates
Procedures
Dealines
Related Revenue Issuances
Codal References
Frequently Asked Questions

DESCRIPTION

Donor’s Tax is a tax on a donation or gift, and is imposed on the gratuitous transfer of property between two or more persons who are living at the time of the transfer.  It shall apply whether the transfer is in trust or otherwise, whether the gift is direct or indirect and whether the property is real or personal, tangible or intangible.

 

TAX FORM

BIR Form 1800 – Donor’s Tax Return

 

DOCUMENTARY REQUIREMENTS

The following requirements must be submitted upon field or office audit of the tax case before the Tax Clearance Certificate/Certificate Authorizing Registration can be released:

  1. Deed of Donation
  2. Sworn Statement of the relationship of the donor to the donee
  3. Proof of tax credit, if applicable
  4. Certified true copy(ies) of the Original/Transfer/Condominium Certificate of Title (front  and back ) of lot and/or improvement donated, if applicable
  5. Certified true copy(ies) of the latest Tax Declaration (front and back pages) of lot and/or improvement, if applicable
  6. “Certificate of No Improvement” issued by the Assessor’s office where the properties have no declared improvement, if applicable
  7. Proof of valuation of shares of stocks at the time of donation, if applicable
    • For listed stocks - newspaper clippings or certification issued by the Stock Exchange as to the par value per share
    • For unlisted stocks - latest audited Financial Statements of the issuing corporation with computation of the book value per share
  8. Proof of valuation of other types of personal properties, if applicable
  9. Proof of claimed deductions, if applicable
  10. Copy of Tax Debit Memo used as payment, if applicable

Additional requirements may be requested for presentation during audit of the tax case depending upon existing audit procedures.

 

TAX RATES

Effective January 1, 1998 to present

Net Gift

Over

But not Over

The Tax

Shall be

Plus

Of the

Excess Over

 

P100,000.00

exempt

 

 

100,000.00

200,000.00

0

2%

100,000.00

200,000.00

500,000.00

P 2,000.00

4%

200,000.00

500,000.00

1,000,000.00

14,000.00

6%

500,000.00

1,000,000.00

3,000,000.00

44,000.00

8%

1,000,000.00

3,000,000.00

5,000,000.00

204,000.00

10%

3,000,000.00

5,000,000.00

10,000,000.00

404,000.00

12%

5,000,000.00

10,000,000.00

and over

1,004,000.00

15%

10,000,000.00

Notes:

  1. Rate applicable shall be based on the law prevailing at the time of donation.
  2. When the gifts are made during the same calendar year but on different dates, the donor’s tax computed on the total net gifts during the year.  

Donation made to a stranger is subject to 30% of the net gift. A stranger is a person who is not a:

  • brother, sister (whether by whole or half blood), spouse, ancestor and lineal descendants; or
  • relative by consanguinity in the collateral line within the fourth degree of relationship (up to first cousin)

 

Effective July 28, 1992 to December 31, 1997

Net Gift

Over

But not Over

The Tax

Shall be

Plus

Of the

Excess Over

 

P50,000.00

Exempt

 

 

50,000.00

100,000.00

1.5%

 

50,000.00

100,000.00

200,000.00

P 750.00

3%

100,000.00

200,000.00

500,000.00

3,750.00

5%

200,000.00

500,000.00

1,000,000.00

18,750.00

8%

500,000.00

1,000,000.00

3,000,000.00

58,750.00

10%

1,000,000.00

3,000,000.00

5,000,000.00

258,750.00

15%

3,000,000.00

5,000,000.00

and over

558,750.00

20%

5,000,000.00

 

Donation made to a stranger is subject to 10% of the net gift. A stranger is a person who is not a:

  • brother, sister (whether by whole or half blood), spouse, ancestor and lineal descendants; or
  • relative by consanguinity in the collateral line within the fourth degree of relationship

 

Effective before July 28, 1992

Net Gift

Over

But not Over

The Tax

Shall be

Plus

Of the

Excess Over

 

P1,000.00

Exempt

 

 

1,000.00

50,000.00

1.5%

 

1,000.00

50,000.00

75,000.00

P 735.00

2.5%

50,000.00

75,000.00

100,000.00

1,360.00

3%

75,000.00

100,000.00

150,000.00

2,110.00

6%

100,000.00

150,000.00

200,000.00

5,110.00

9%

150,000.00

200,000.00

300,000.00

9,610.00

12%

200,000.00

300,000.00

400,000.00

21,610.00

15%

300,000.00

400,000.00

500,000.00

36,610.00

18%

400,000.00

500,000.00

625,000.00

54,610.00

21%

500,000.00

625,000.00

750,000.00

80,860.00

24%

625,000.00

750,000.00

875,000.00

110,860.00

28%

750,000.00

875,000.00

1,000,000.00

145,860.00

32%

875,000.00

1,000,000.00

2,000,000.00

185,860.00

36%

1,000,000.00

2,000,000.00

3,000,000.00

545,860.00

38%

2,000,000.00

3,000,000.00

 

925,860.00

40%

3,000,000.00

Donation made to a stranger is subject to 20% of the net gift. A stranger is a person who is not a:

  • brother, sister (whether by whole or half blood), spouse, ancestor and lineal descendants; or
  • relative by consanguinity in the collateral line within the fourth degree of relationship

 

PROCEDURES

File the return in triplicate (two copies for the BIR and one copy for the taxpayer) with any Authorized Agent Bank (AAB) of the RDO having jurisdiction over the place of the domicile of the donor at the time of the transfer. In places where there are no AAB, the return will be filed directly with the Revenue Collection Officer or duly Authorized City or Municipal Treasurer where the donor was domiciled at the time of the transfer, or if there is no legal residence in the Philippines, with Revenue District No. 39 - South Quezon City.

In the case of gifts made by a non-resident alien, the return may be filed with Revenue District No. 39 - South Quezon City, or with the Philippine Embassy or Consulate in the country where donor is domiciled at the time of the transfer.

Submit all documentary requirements and proof of payment to the Revenue District Office having jurisdiction over the place of residence of the donor.

 

DEADLINES

Within thirty days (30) after the date the gift (donation) is made. A separate return will be filed for each gift (donation) made on the different dates during the year reflecting therein any previous net gifts made during the same calendar year

If the gift (donation) involves conjugal/community/property, each spouse will file separate returns corresponding to his/ her respective share in the conjugal/community property. This rule will also apply in the case of co-ownership over the property

 

RELATED REVENUE ISSUANCES

RR No. 2-2003 and RMO No. 1-98

 

CODAL REFERENCE

Sec. 98 to Sec. 104 of the National Internal Revenue Code

 

FREQUENTLY ASKED QUESTIONS

1.   Who are required to file the Donor’s Tax Return?

Every person, whether natural or juridical, resident or non-resident, who transfers or causes to transfer property by gift, whether in trust or otherwise, whether the gift is direct or indirect and whether the property is real or personal, tangible or intangible.

2)   What are the procedures in filing the Donor’s Tax return?

File the return in triplicate (two copies for the BIR and one copy for the taxpayer) with any Authorized Agent Bank (AAB) of the RDO having jurisdiction over the place of the domicile of the donor at the time of the transfer. In places where there are no AAB, the return will be filed directly with the Revenue Collection Officer or duly Authorized City or Municipal Treasurer where the donor was domiciled at the time of the transfer, or if there is no legal residence in the Philippines, with Revenue District No. 39 - South Quezon City.

In the case of gifts made by a non-resident alien, the return may be filed with Revenue District No. 39 - South Quezon City, or with the Philippine Embassy or Consulate in the country where donor is domiciled at the time of the transfer.

Submit all documentary requirements and proof of payment to the Revenue District Office having jurisdiction over the place of residence of the donor.

 

3)   What donations are tax exempt?      

·    Dowries or donations made on account of marriage before its celebration or within one year thereafter, by parents to each of their legitimate, recognized natural, or adopted children to the extent of the first P10,000

·    Gifts made to or for the use of the National Government or any entity created by any of its agencies which is not conducted for profit, or to any political subdivision of the said Government

·    Gifts in favor of an educational and/or charitable, religious, cultural or social welfare corporation, institution, accredited non-government organization, trust or philantrophic organization or research institution or organization, provided not more than 30% of said gifts will be used by such donee for administration purposes

·    Encumbrances on the property donated if assumed by the donee in the deed of donation

·    Donations made to the following entities as exempted under special laws:

-     Aquaculture Department of the Southeast Asian Fisheries Development Center of the Philippines

-     Development Academy of the Philippines

-     Integrated Bar of the Philippines

-     International Rice Research Institute

-     National Social Action Council

-     Ramon Magsaysay Foundation

-     Philippine Inventor’s Commission

-     Philippine American Cultural Foundation

-     Task Force on Human Settlement on the donation of equipment, materials and services

 

4)   What are the bases in the valuation of property?

If the gift is made in property, the fair market value at that time will be considered the amount of gift

In case of real property, the taxable base is the fair market value as determined by the Commissioner of Internal Revenue (Zonal Value) or fair market value as shown in the latest schedule of values of the provincial and city assessor (MV per Tax Declaration), whichever is higher

If there is no zonal value, the taxable base is the fair market value that appears in the latest tax declaration

If there is an improvement, the value of improvement is the construction cost per building permit and or occupancy permit plus 10% per year after year of construction, or the market value per latest tax declaration.