S.A 2020/21 B.E TAXATION LAW | Question #17
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| SUGGESTED ANSWERS TO THE 2020/21 BAR EXAMINATIONS IN TAXATION LAW #TaxationLaw #PreviousBarQuestions Code: S.A 2020/21 B.E TAXATION LAW | Question #17 |
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BAR QUESTION |
After finally passing the Bar Examinations, a new lawyer was given an engagement ring worth PHP1,000,000.00 by a longtime significant other who happened to be one of the most junior sitting Justices of the Supreme Court.
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| SHOP HERE VOL. I VOL. II Their relationship has so far been platonic. Being an avid supporter of the current government, the new lawyer told the significant other that the gift would only be accepted if all taxes due have been paid. |
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Is there any tax liability arising from the giving of the engagement ring? Explain briefly.
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SUGGESTED ANSWER |
Yes, there is a tax liability arising from the giving of the engagement ring should the new lawyer accept it.
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The giving of the Php 1,000,000.00 engagement ring is gratuitous in character, hence, subject to the payment of the 6% donor’s tax on the amount exceeding Php 250,000.00.
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