BUSINESS AND TRANSFER TAXATION 6th Edition (BY: VALENCIA & ROXAS)

SUGGESTED ANSWERS
Ch!t"# $6: DOCU%ENTARY STA%& TAXES
C'A&TER $6
DOCU%ENTARY STA%& TAXES
Problem 16 1
1. True
2. True
3. False the transaction.
4. False to be taxed against the party who is not exempt.
5. True
6. False 10 days from the close of the month
7. True
8. True
9. True
10.True
Problem 16 2 B
Documentary stamp tax to be paid (P1,000/P200) x P10 x P2 P 100
Problem 16 3 A
Documentary stamp tax to be paid ($5,000 x P40/P200) x P0.30 P 300
Problem 16 4 B
DST on frst P5,000
DST on excess of the frst P5,000 = (P395,000/P5,000) x P10
Total documentary stamp tax
P 20
790
P810
Problem 16 5 C
Documentary stamp tax (P800,000/P1,000) x P15 P12,000
Problem 16 6 D
DST on frst P2,000
DST on excess of the frst P2,000 = (P142,000/P1,000) x P1
Total
Multiply by
Total documentary stamp tax
P 3
142
P145
2
P290
Problem 16 7
Face value of the bonds
Divide by
Multiply by documentary stamp tax
Documentary stamp tax
P50,000
200
250
P 1.50
P 375
Problem 16 8
Par value of the stock (P100 x 1,000 shares)
Divide by
Multiply by documentary stamp tax
P100,000
200
500
P 2.00
Documentary stamp tax P 1,000
Problem 16 9
Par value (P100 x 100 shares)
Divide by value
Multiply by documentary stamp tax
Documentary stamp tax
P10,000
200
50
P 1.50
P 75
Problem 16 10
Face value of document
Divide by
Multiply by documentary stamp tax rate
Documentary stamp tax
P100,000
200
500
P 0.30
P 150
Problem 16 11
Face value of document (P50 x $5,000)
Divide by
Multiply by documentary stamp tax rate
Documentary stamp tax
P250,000
200
1,250
P 0.30
P 375
Problem 16 12
Insurance policy
Divide by
Multiply by documentary stamp tax rate
Documentary stamp tax
P1,000,000
200
5,000
P 0.50
P 2,500
Problem 16 13
Annual insurance premium
Divide by
Multiply by documentary stamp tax rate
Documentary stamp tax
P 5,000
4
1,250
P 0.50
P 625
Problem 16 14
The documentary stamp tax on the afdavit of loss is P15.00.
Problem 16 15
The documentary stamp tax would be P10.00.
Problem 16 16
Sales price
Less: Unpaid mortgage balance
Balance
Less: Amount not subject to DST
Balance
Divide by
Multiply by
Documentary stamp tax
P1,000,000
200,000
P 800,000
1,000
P 799,000
P 1,000
799
P 15
P 11,985
Add: DST for the frst P1,000
Total documentary stamp tax
15
P 12,000
Problem 16 17
Documentary stamp (P1,000,000/ P1,000) x 15
Surcharge (P15,000 x 25%)
Interest (from June 25 to July 25) (P15,000 x 20%)
Total payable
P15,000
3,750
250
P19,000
Problem 16 18
a. P 0
b. P 0
See page 503 of the textbook. Deeds of property donated to the government are exempt from
documentary stamp tax.