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GROSS ESTATE
- Depends upon the citizenship and/or residence of the decedent:
Intangible personal property means incorporeal property which do not have any physical form, but
represents rights and privileges. Examples include bank deposits, trademarks, shares of stock, patents,
copyrights, bonds notes, interest in a partnership, etc.
1) Properties owned by the decedent and physically present in his estate at the time of
death;
3) Taxable transfers – made during lifetime, but are in the nature of testamentary dispositions
(mortis causa in substance). Though he has transferred the property during his lifetime, he remains in
control of the property, and the transfer is intended to take effect only at or after his death.
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a) Transfers in Contemplation of Death
- Transfer is impelled by the thought of death.
Ex. Donation mortis causa – donation which takes effect upon the death of the donor, and
therefore partakes of the nature of a testamentary disposition.
b) Revocable transfers;
The transferor reserves the power to alter, amend, revoke, or terminate the enjoyment of the
property by the transferee, or where such power is relinquished in contemplation of the
decedent’s death.
- Whether or not such power is exercised during lifetime. If not exercised during lifetime, it is
considered exercised at the time of death.
- Transferor reserves his right to the income of the property until his death.
- Transferor reserves his right to the possession or enjoyment of the property until his death.
In all the taxable transfers above, if the transfer is a bona fide sale for adequate and full
consideration in money or money’s worth, no value (of the property transferred) shall be
included in the gross estate.
However:
1) If the transfer is not a bona fide sale for an adequate and full consideration in money or
money’s worth, there shall be included in the gross estate the excess of the FMV of the
property at the time of death over the value of the consideration received by the decedent;
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Included in gross estate = FMV of property at time of death – Consideration received
2) If transfer is fictitious, the total value of the property at time of death shall be included in the
gross estate of the decedent.
Proceeds of life insurance taken out by the decedent upon his own life shall be included in his
gross estate when:
1) His estate, his executor or administrator is the beneficiary; whether or not the designation of
the beneficiary is revocable; or
2) The beneficiary is any other person, but the decedent retains the power to revoke the
designation.
PROPERTIES OF SPOUSES
- The extent of the gross estate of the decedent shall depend upon the property relations
between the decedent and his/her spouse.
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Property Regimes:
The spouses may, in a pre-nuptial agreement (marriage settlement), agree upon the regime that shall govern
their property relations.
However, in the absence of a marriage settlement, the property relations shall be governed by:
a) The CPG for those married before August 3, 1988; or
b) The ACP for those married on or after August 3, 1988.
Husband Wife
Conjugal Properties
1) Properties acquired by onerous title using the common funds (even if the property is
only for one of the spouses);
2) Properties obtained from the labor or work of the spouses during marriage;
3) Properties acquired by chance such as winnings from gambling or betting. (However,
losses therefrom shall be borne exclusively by the loser-spouse).
4) Fruits (natural or civil) and income of the conjugal properties;
5) Fruits (natural or civil), and income of the exclusive properties of each spouse;
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What is the ACP?
Husband Wife
Conjugal Properties
(a) Merger of the usufruct in the owner of the naked title to the property;
(c) The transmission from the first heir, legatee, or donee in favor of another beneficiary, in accordance
with the desire of the predecessor;
Note: In the three (3) cases, there is actually one transfer involved. Such transfers were already
subjected to estate tax, and taxing these would amount to double taxation.
(d) All bequests, devises, legacies, or transfers to social welfare, cultural, and charitable institutions, no
part of the income of which inures to the benefit of any individual. Provided, however, that not more
than 30% of the said bequests, devices, legacies, or transfers shall be used by such institutions for
administration purposes (Sec. 87, NIRC)
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Other Exemptions from the estate tax:
(e) Proceeds of life insurance and benefits received by members of the Government Service Insurance
System (“GSIS”). (P.D. No. 1146);
(f) Benefits received by members from the Social Security System by reason of death (R.A. No. 1161, as
amended);
(g) Amounts received from the Philippine and Unites States governments for war damages (R.A. 227);
(h) Amounts received from the United States Veterans Administration (R.A. No. 360);
(i) Retirement benefits of employees of private firms from private pension plans approved by the BIR;
(j) Intangible personal property located in the Philippines of a non-resident alien decedent under the
principle of reciprocity (Sec. 104, NIRC); and
(k) Personal Equity and Retirement Account (“PERA”) assets shall not be considered assets of the
Contributor for purposes of estate tax (R.A. No. 9505).
Furthermore, Qualified PERA Distributions received by the Contributor, or in case of the death of the
Contributor, received by his heirs or beneficiaries, whether in a lump sum or pension for a definite
period or lifetime pension, shall not be subject to estate tax (Sec. 10, Rev. Regs. No. 17-2011)
Property Valuation
Usufruct, use, habitation, Value shall be based on the probable life of the beneficiary in accordance
annuity with the latest Basic Standard Mortality Table approved by the Department
of Finance
Real Property FMV which is the higher of the zonal value or the assessor’s value
Stocks listed in the stock Average of the lowest and highest quotes on the valuation date (date of
exchange death) or day nearest to the valuation date
Stocks not listed in any For common shares: Book value on the valuation date (date of death), or on
local exchange the date nearest the valuation date
Notes; accounts FMV is the discounted amount of the unpaid principal plus interest
receivable
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Units of participation in FMV is the bid price nearest the date of death published in any newspaper
any association, or publication of general circulation
recreation, or
amusement club
I. ORDINARY DEDUCTIONS
1) Claims against the estate – consist of the bona fide unpaid personal obligations of the
decedent of a pecuniary nature. These can arise from contract, tort, or by operation of law.
These must be incurred in good faith by the decedent during his lifetime, and can be enforced1
against the state by his creditors.
These include personal obligations of the decedent at the time of his death except unpaid
obligations incurred incidental to his death such as funeral or medical expenses.
(A) If the claim arises from the purchase of goods or services by the decedent, the following
must be submitted:
1) Documents evidencing the purchase (invoices, receipts, statements of accounts);
2) Creditor’s certification as to the unpaid balance of the debt, including interest;
and
3) Certified true copy of the latest audited balance sheet of the creditor showing
the unpaid balance of the decedent.
(B) If the claim is in the form of a loan, the following requirements must be complied
with:
1) The instrument must be notarized except if it is not the business practice of the
financial institution-lender to notarize such instruments;
2) Notarized certification from the creditor as to the unpaid balance of the debt,
inclusive of interest;
3) Proof of financial capacity of the creditor to lend the amount at the time the loan
was granted;
4) If the loan was contracted within 3 years prior to the death of the decedent, a
statement under oath executed by the administrator/executor of the estate
stating the disposition of the proceeds of the loan.
1 Must not have been forgiven by the creditor, or the action to collect must not have prescribed.
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2) Claims against insolvent persons
- Must first be included in the gross estate;
- Portion or amount that cannot be collected from the decedent’s debtor is
deductible from the gross estate.
3) Unpaid mortgages – the unpaid mortgage or indebtedness is deductible from the gross
estate provided that the decedent’s interest in the property, gross of the mortgage, is included
in the gross estate.
- if the loan is an accommodation loan where the loan proceeds went to another
person, the value of the unpaid loan must be included in the gross estate as a
receivable.
5) Casualty Losses – on account of mishaps, accidents, casualties, acts of God, robbery, theft,
embezzlement can be deducted provided:
1) Transfers made to the government or any political subdivision for public purposes; or
(a) The present decedent must have acquired the property by inheritance or donation within five (5)
years prior to his death;
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(b) The property acquired formed a part of the gross estate of the prior decedent, or of the taxable
gift of the donor;
(c) The estate tax on the prior estate, or the gift tax on the gift must have been paid; and
(d) The estate of the prior decedent has not previously availed of the vanishing deduction.
(a) The death of the present decedent, and the death of the prior decedent if the property
previously taxed (“PPT”) was acquired by inheritance, or
(b) The death of the present decedent, and the date of the gift, if the PPT was acquired by
donation.
(b) Deduct any mortgage or lien on the PPT which was paid by (xxx)
the present decedent, where such mortgage or lien was used as
a deduction in the computation of the estate tax of the prior
decedent, or as a deduction in determining the donor’s tax.
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(c) Prorate the deduction and subtract from the net value:
A) FAMILY HOME
- Must be included in the gross estate
- The deduction is only for one family home which must be the actual residential home of the
decedent as certified to by the barangay captain.
- Lower of:
1) FMV of the family home;
a) If family home is exclusive property of the decedent: FMV
b) If family home is conjugal property: FMV ÷ 2
c) If family land is exclusive while the family house is conjugal: FMV of land + (FMV
of house ÷ 2)
d) If family land is conjugal while family house is exclusive: (FMV of land ÷ 2) +
FMV of house
OR
2) P10,000,000
B) STANDARD DEDUCTION
1) P5,000,000 for estates of citizens and resident aliens; P500,000 for estates of non-resident aliens
2) Substantiation not required
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III. SHARE OF THE SURVIVING SPOUSE IN THE NET CONJUGAL PROPERTIES
- Share of the surviving spouse is not subject to estate tax and must therefore be deducted from the
gross estate of the decedent.
SUMMARY OF DEDUCTIONS
I. What deductions are available against the estates of citizens, residents, or non-resident
aliens?
II. If the decedent was married, how do we allocate the deductions between the exclusive
and conjugal properties?
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B. Transfer for public use ✔
C. Vanishing Deduction ✔ ✔
Net estate before Special Deductions xxxx xxxx xxxx
D. Family Home ✔
E. Standard Deduction ✔
F. Amounts received by heirs under RA 4917 ✔
G. Share of surviving spouse in conjugal net estates ✔
NET ESTATE NET ESTATE
Limits:
(B) Net Estate (in all Foreign Countries) x Philippine Estate Tax
Entire Net Estate
Rules:
1) If there is only one (1) foreign country, only Limit (A) is used
2) If there are two (2) or more foreign countries, use both Limits
Who files?
The executor or administrator, or any of the legal heirs.
Time of filing?
Within 1 year from death of the decedent.
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Time of filing can be extended for another 30 days or less in meritorious cases. The application for
the extension of time to file the estate tax return must be filed with the Revenue District Office
(“RDO”) where the estate is required to secure its TIN and file its tax returns. This request shall be
approved by the Commissioner or his duly authorized representative.
Where filed?
1) If decedent was a resident – the administrator or executor shall register the estate and secure a
new TIN therefor from the RDO where the decedent was domiciled at the time of his death.
2) If decedent was a non-resident (whether citizen or alien) – the TIN for the estate shall be secured
from, and the estate tax return shall be filed with:
a) The RDO where the executor/administrator is registered
b) If the executor/administrator is not registered with the BIR, with the RDO having
jurisdiction over the legal residence of the executor/administrator
c) If there is no executor/administrator, with the Office of the Commissioner (RDO No. 39,
South Quezon City)
When paid?
- Estate tax is paid at the time the return is file (pay as you file).
When the Commissioner finds that the payment on the due date of the estate tax or any part of
thereof would impose undue hardship upon the estate or any of the heirs, he may extend the
time for payment of such tax or any part thereof not to exceed five (5) years in case the estate is
settled through the courts, or two (2) years in case the estate is settled extrajudicially.
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The application for extension of time to pay the estate tax shall be filed with the RDO where the
estate is required to secure its TIN and file its estate tax return. This request shall be approved
by the Commissioner or his duly authorized representative.
The Commissioner may require the executor, or administrator, or beneficiary, as the case may
be, to furnish a bond in such amount, not exceeding double the amount of the tax, conditioned
upon the payment of the said tax in accordance with the terms of the extension.
Any amount paid after the statutory due date of the tax, but within the extension period, shall be
subject to interest but not to surcharges.
Payment by Installment
In case of insufficiency of cash for the immediate payment of the total estate tax due, the estate may
be allowed to pay the estate tax due through the following options:
a. The estate tax return shall be filed within one (1) year from the date of decedent’s
death;
b. The cash installment shall be made within two (2) years from the date of filing of the
estate tax return2;
d. No civil penalties or interest may be imposed on estates permitted to pay the estate
tax due by installment. However, the Commissioner is not prevented from executing
enforcement actions against the estate after the due date of the estate tax, provided
that all the applicable laws and required procedures are followed/observed; and
e. In case of the lapse of 2 years without the entire estate tax due being paid, the
remaining balance thereof shall be due and demandable subject to the applicable
penalties and interest reckoned from the prescribed deadline for filing the return, and
payment of the estate tax.
(2) Partial Disposition of Estate and Application of its Proceeds to the Estate Tax
Due 3
2 In case the available cash of the estate is insufficient to pay the total estate tax due, payment by installment shall be
allowed within two (2) years from the statutory date for its payment without civil penalty and interest (Sec. 91 (C),
NIRC as inserted by R.A. No. 10963).
3 The application for payment by installment or partial disposition of the estate must be filed with the RDO where the
estate is required to secure its TIN and file its tax returns. This request shall be approved by the Commissioner or his
duly authorized representative.
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a. The estate tax return shall be filed within one (1) year from the date of decedent’s
death;
b. The written request for the partial disposition4 of the estate shall be approved by the
BIR. The said request shall be filed, together with a notarized undertaking that the
proceeds thereof shall be exclusively used for the payment of the total estate tax due;
c. The computed estate tax due shall be allocated in proportion to the value of each
property;
d. The estate shall pay to the BIR the proportionate estate tax due of the property
intended to be disposed of;
f. In case of failure to pay the total estate tax due out of the proceeds of the said
disposition, the estate tax due shall be immediately due and demandable subject to
the applicable penalties and interest reckoned from the prescribed deadline for filing
the return and payment of the estate tax. This is the without prejudice to the
withholding of the issuance of the eCARs on the remaining properties until the
payment of the remaining balance of the estate tax due, including the penalties and
interest.
1) The executor or administrator. Where there are 2 or more executors or administrators, all of
them shall be severally liable for the payment of the tax.
2) An heir shall be subsidiarily liable but only to the extent of his share in the net estate.
The estate tax clearance (CAR) issued by the Commissioner or the RDO having jurisdiction over the
estate will serve as the authority to distribute the remaining or distributable properties or shares in
the inheritance to their heirs or beneficiaries.
No judge shall authorize the executor or a judicial administrator to deliver a distributive share to any
party interested in the estate unless a certification from the Commissioner that the estate tax has
been paid is shown.
4For purposes of this option, disposition shall refer to the conveyance of property, whether real, personal or intangible
property, with the equivalent cash consideration (Rev. Reg. No. 12-2018).
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Payment of Estate Tax as Prerequisite to Transfer of Shares, Bonds, Rights
There shall not be transferred to any new owner in the books of any corporation, sociedad anonima,
partnership, business, or industry organized or established in the Philippines any share, obligation,
bond, or right by way of gift inter vivos or mortis causa, legacy, or inheritance, unless an eCAR is
issued by the Commissioner or his duly authorized representative.
The executor, administrator, or any of the legal heirs may be allowed to withdraw from a bank
deposit of the decedent within 1 year from the date of death. The amount withdrawn shall be
subject to a 6% final withholding tax.
For joint accounts, the 6% final withholding tax shall be based on the share of the decedent in the
joint bank deposit.
The bank is required to file the prescribed quarterly return on the final tax withheld on or before the
last day of the month following the close of the quarter during which the withholding was made.5 In
all cases, the final tax withheld shall not be refunded nor credited against the tax due on the net
taxable estate of the decedent.6
In instances where the bank deposit accounts have been duly included in the gross estate of the
decedent, and the estate tax due thereon paid, the executor, administrator, or any of the legal heirs
shall present the eCAR issued for the said estate prior to withdrawal. Such withdrawal shall no
longer be subject to the withholding imposed under Section 97 of the Tax Code.
5 The bank shall issue the corresponding BIR Form No. 2306 (Certificate of Final Tax Withheld At Source) certifying
such withholding.
6 The non-availability of the withheld tax as a credit against the estate tax due necessarily means that the amount
withdrawn (gross of the 6% withheld tax) is excluded from the gross estate.
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DONOR’S TAX
Requisites: 1) Transfer is gratuitous or without consideration. The transfer is made out of pure
generosity of the donor (donative intent)
2) Both the donor and donee are living at the time of the transfer (inter vivos)
3) There must be a completed gift
Contract of Donation
When perfected? At the moment the donor knows of the acceptance of the gift by the donee
(Art. 734, Civil Code).
Who can be donors? All persons who may contract and dispose of their property may make a donation
(Art. 735, Civil Code).
Who can be donees? All those who are not specially disqualified by law may accept donations
(Art. 738, Civil Code).
Minors and others who cannot enter in to a contract may become donees, but
acceptance shall be done through their parents or legal representatives
(Art. 741, Civil Code).
1) Between spouses, whether direct or indirect, during the marriage, except moderate gifts which the
spouses may give each other on the occasion of any family rejoicing (Art. 87, Family Code);
Note: Indirect donations to a spouse are void, and include the following donations of a spouse:
a) To a stepchild who has no compulsory heirs other than the other spouse at the time of
the donation;
b) To a common child who has no compulsory heirs other than the other spouse at the time
of the donation;
c) To the parents of the other spouse;
d) To the other spouse’s adopted child in cases when, at the time of the donation, the only
surviving relatives of the adopted is the adopter-spouse, the illegitimate children of the
adopted, and the surviving spouse of the adopted;
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e) To a common adopted child who has no other surviving heirs (see Art. 190, Family
Code)
2) Between persons living together as husband and wife without a valid marriage (Art. 87, Family
Code);
3) Between persons guilty of concubinage or adultery at the time of donation (Art. 739, Civil Code);
4) Between persons found guilty of the same criminal offense, in consideration thereof (Art. 739, Civil
Code);
5) Those made to a public officer or his/her spouse, descendants, and ascendants, by reason of his or
her office (Art. 739, Civil Code).
a) Donations to the priest who heard the confession of the donor during his last illness, or the
minister who extended spiritual aid to him during the same period;
b) Donations to the relatives of such priest or minister in (a) within the 4th degree;
c) Donations to the church, order, chapter, community, organization, or institution to which such
priest or minister in (a) belongs;
d) Those who made a guardian with respect to donations made by a ward before the final accounts
of the guardianship have been approved, except when the guardian is the ward’s ascendant,
descendant, brother, or sister;
e) Any physician, surgeon, nurse, health officer, or druggist who took care of the donor during his
last illness (Art. 740, Art. 1027, Civil Code)
Donation of Movables
If value of the movable does not exceed P5,000, the donation may be oral or in writing, and the
acceptance may be oral, in writing, or tacit
If the value of the movable is exceeds P5,000, the donation and the acceptance must be in
writing, otherwise the donation is void. Without such writing, the donation would be void, even if there is
simultaneous delivery (Art. 748, Civil Code)
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Donation of Immovables
Acceptance may be made in the same deed of donation or in a separate public instrument. The
acceptance must be done during the lifetime of the donor, and the latter must be notified of the
acceptance.
Requisites:
(a) The property transferred is real or personal property, except real property classified as a
capital asset referred to in Section 24(D) of the Tax Code;
(b) The transfer is for less than a full price;
(c) The transfer is inter vivos.
Purpose: To prevent escape from the income tax by accepting a lower price for the property.
Tax Consequences:
Gift (subject to the Donor’s Tax) Income (subject to the Income Tax)
FMV of the property transferred Price (consideration) received
Less: Price (consideration) received Less: Cost
In Transfer for the Insufficient Consideration in the Sale of Domestic Shares of Stock:
(1) If the shares are listed, but are sold, bartered, or exchanged outside the local
stock exchange, the FMV shall be:
(a) The closing price on the day the shares are sold, bartered, or exchanged;
or
(b) The closing price on the day nearest to the date of sale, barter, or
exchange if there is no sales transaction of the shares in the local stock
exchange on the day it was sold, bartered, or exchanged.
(2) If the shares are not listed in the local stock exchange, the FMV shall be
determined using the Adjusted Net Asset Value Method. In such method,
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all assets and liabilities are adjusted to fair market values. The net adjusted asset
minus the adjusted liability values is the value of the equity. For real properties,
the FMV shall be the highest of the zonal value, assessor’s value, or the
independent appraiser’s value (Rev. Regs. 6-2008, 6-2013).
EXCEPTION: When the sale/exchange is bona fide, at arm’s length, and free from any donative
intent, the same will be considered as made for an adequate and full consideration
in money or money’s worth.7 In such cases, there is no insufficient consideration, and
therefore no gift.
GROSS GIFT
- Depends upon the citizenship and/or residence of the donor:
Non-resident
Donor:
3) Non-resident Alien
(if there is
reciprocity)
Intangible personal property means incorporeal property which do not have any physical form, but
represent rights and privileges. Examples include bank deposits, trademarks, shares of stock, patents,
copyrights, bonds, notes, interest in a partnership, etc.
(a) The conjugal or community properties. Each spouse shall be considered a separate donor
of his or her interest in the property: ½ of the conjugal property donated being a gift of the
husband, and the other half that of the wife.
Valuation of Gifts
- Properties shall be valued at the time the gift is made
Property Valuation
Real Property FMV which is the higher of the zonal value or the assessor’s value
Personal Property FMV at the time of the gift
Stocks listed in the stock Average of the lowest and highest quotes on the valuation date (date of
exchange gift) or day nearest to the valuation date.
Stocks not listed in any For common shares: Book Value8
local exchange For preferred shares, par value.
Notes; accounts FMV is the discounted amount of the unpaid principal plus interest.
receivable
Stock options (1) At the time of donation, the FMV of the stock option
(2) Upon exercise of the option, the difference between the higher of the
BV or FMV of the underlying shares at the time of exercise, and the
exercise price.
Units of participation in Bid price nearest the date of the gift published in any newspaper or
any association, publication of general circulation.
recreation, or amusement
club
8 In determining the book value, appraisal surplus and the value assigned to preferred shares shall not be considered.
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EXEMPTIONS (EXCLUSIONS) FROM GROSS GIFT
Provided:
1) The non-profit institution is a non-stock entity that pays no dividends, is governed by trustees
who do not receive any compensation, and devotes all of its income to the accomplishment of
its purposes; and
2) Not more than 30% of the gifts shall be used for administrative purposes.
3) The non-profit institution must be accredited by the designated accrediting government agency,
and registered with the BIR.
C) Campaign contributions in cash or in kind to any candidate which are duly reported
to the COMELEC (R.A. 7166)
However, donations made by corporations in violation of Section 36(9) of the Corporation Code are
subject to donor’s tax, and may not be deducted by the donor-corporation.9
D) Other donations which are exempted from the donor’s tax under special laws:
(1) Donation made for the operation of the Dual Training System under R.A. No. 7686.
(2) Donations of cooperatives to duly accredited charitable, research, and educational institutions,
and to socio-economic projects within their area of operations;
(3) Donations of lands certified by the LGU to have been donated for socialized housing purposes;
(4) Donation to the Philippine Red Cross;
(5) Donations to state universities and colleges.
Beginning January 1, 2018, the tax shall be six percent (6%) computed on the basis of the total gifts in
excess of Two Hundred Fifty Thousand Pesos (P250,000) exempt gift made during the calendar
year.10
The computation of the donor’s tax is on a cumulative basis over a period of one (1) calendar year.11
The donor’s or gift tax is computed on the net gift of the first donation. In case there are subsequent
donations in the same calendar year, the tax is computed on a cumulative basis, i.e., the prior gross gifts in
the same calendar year are added to the current gross gift to arrive at the total gross gifts. The total
exemptions or deductions shall be subtracted from the total gross gifts. The donor’s tax shall be based on
the total net gifts.
(B) Net Gifts (in all Foreign Countries) x Philippine Donor’s Tax
Total Net Gifts
Rules:
1) If there is only one (1) foreign country, only Limit (A) is used.
2) If there are > two (2) foreign countries, use both Limits
Formula:
Lower = Credit
Sum of donor’s taxes paid in
Countries 1 and 2
Lower = Limit (B)
Limit B
Who files?
Any individual who makes any transfer by gift.
Notes:
(a) No return is required if the transfer is exempt from donor’s tax, like donations to the National
Government or to non-profit institutions.
(b) A separate return shall be filed by each donor for each gift or donation made on different dates
during the year. Any previous gifts made in the same calendar year shall be reflected in each return.
(c) Only one return shall be filed for several gifts or donations by a donor made on the same date to
different donees.
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(d) If the gift or donation involves conjugal/community property, each spouse shall file a separate return
corresponding to his/her respective share in the conjugal/community property. This rule shall
likewise apply in the case of co-ownership over the property being donated.12
Time of filing?
Within thirty (30) days from the date the gift is made.
Where filed?
(a) If donor is a resident donor (i.e., citizen or resident alien) – with the Authorized Agent Bank (AAB),
RDO, collection officer or duly authorized treasurer of the city or municipality where donor is
domiciled at the time of transfer, or with the Office of the Commissioner if donor has no legal
residence.
(b) If donor is a non-resident donor (i.e., non-resident alien) – with the Philippine Embassy or Consulate
in the country where he is domiciled at the time of transfer; or directly with the Office of
Commissioner (RDO No. 39).
1) Each gift made during the calendar year which is to be included in computing net gifts;
2) The deductions claimed and allowable;
3) Any previous net gifts made during the same calendar year;
4) The name of the donee; and
5) Such further information as may be required.
Notice of Donation. 14
In order to be exempt from the donor’s tax and to claim full deduction of the donation given to qualified
donee institutions, the donor engaged in business shall give a Notice of Donation on every donation
worth at least Fifty Thousand Pesos (P50,000) to the RDO which has jurisdiction over his place of business.
The aforementioned notice shall be given to the RDO within thirty (30) days after receipt of the donee’s duly
issued Certificate of Donation (BIR Form No. 2322). The same certificate shall be attached to the Notice of
Donation, and shall state that not more than 30% of the donations for the taxable year shall be used by such
accredited non-stock, non-profit, NGO-donee institution for administration purposes pursuant to Section
101(A)(3) and B(2) of the Tax Code.
12 Guidelines and Instructions (BIR Form No. 1800 – Donor’s Tax Return)
13 Sec. 103(A), NIRC
14 Rev. Reg. NOs. 2-2003, 12-2018
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