Basic Taxation Law: Donor's Tax
Donor’s Tax Preliminary Donation Article 725, New Civil Code : Donation is an act of liberality whereby a person disposes gratuitously of a thing or right in favor of another, who accepts it . Spouses Romulo and Sally Eduarte u. Court of Appeals,G.R. No. 105944, February 9, 1996 : On the part of the donor, it is an exercise of one's generosity. For tax purposes, donation may be donation mortis causa or donation inter vivos. Donation mortis causa is a donation that takes effect upon the death of the donor . This donation is subject to estate tax . Donation inter vivos , on the other hand, is a donation made between living persons or those to take effect during the lifetime of the donor. This donation is subject to donor's tax . Republic of the Philippines v. David Rey Guzman, G.R. No. 132964, February 18, 2000 : Donation has the following elements: RII the reduction of the patrimony of the donor ; the increase in the patrimony o...