Integrative Course 2 (INTEGR2)

Academic Year 2014-2015

Practice Set
CASES. Straight Problems. Write the answer of the correct answer on the problem. Round-off only on your
final answers up to 2 decimal places (45 minutes). Avoid opening your notes or lectures.
CASE A
Mrs. Andres, a Filipino and a resident of the Canada, married under the property regime of conjugal
partnership of gains at the time of death, left the following properties and rights, with fair market values
indicated, and obligations and charges, in the amounts stated:
Conjugal properties:
Family home
Franchise exercisable in Canada
Exclusive properties:
Inherited land
Receivable from Mr. Albay
Shares of stock of Apol Corporation (foreign corporation with more than 85% of
operations in Jamaica)
Obligations and charges:
Medical expenses
Funeral expenses
Judicial expenses
Unpaid mortgage on inherited property
Unpaid mortgage on family home
Unpaid tax on exclusive property
Loss of conjugal property during the deceaseds wake
Other claims against exclusive properties
Other claims against conjugal properties
Legacy of exclusive property disposed in favor of PNP-SAF administration

P
2,200,000
1,500,000
1,200,000
200,000
700,000

2,000,000
3,000,000
140,000
100,000
150,000
20,000
10,000
60,000
300,000
500,000

The land was inherited three years and eleven months before Mrs. Andress death, with a fair market value
at the time of inheritance at P880,000 and a mortgage thereon of P180,000. Mrs. Andress paid P80,000 on
the mortgage.
Mr. Albay, Mrs. Andress special friend had P2,000,000 in total liabilities with P100,000 in total assets at the
time of declaration of insolvency. The court decide to proportionately distribute his total assets to settle his
liabilities without seniority rights for other creditors.
Jamaica currently has reciprocity on tax laws with the Philippines. Canada currently has reciprocity on tax
laws with the Philippines.
1.
2.
3.
4.
5.
6.
7.
8.
9.

Total exclusive properties

Total conjugal properties
Total deductions on exclusive properties
Total deductions on conjugal properties
Total share of surviving spouse
Amount of vanishing deductions
Net taxable estate
Estate tax due
If Mrs. Andres died on February 6, 2015, when should the Notice of Death be submitted to the BIR?

10. The estate of Mrs. Andres is being administered by his 3rd child (of a total of 5 children). Assuming
settlement is executed outside of court, when is the deadline of payment of the estate tax due?
CASE B
Mr. Bernas, a resident citizen of the Philippines, married under the system of absolute community of
property, died leaving the following properties and obligations:
Real properties inherited from his mother four years ago and before the marriage
Real properties received as gift from his father three years ago and during the
marriage
Cash income from the property received as gift
Real property owned by Mrs. Bernas before the marriage
Real property (family home) acquired during the marriage

400,000
2,230,000
10,000
600,000
1,000,000

His estate also had the following expenses:

Medical expenses
Funeral expenses
Judicial expenses for the settlement of the estate
Obligations incurred during the marriage
Indebtedness incurred before the marriage for a pleasure trip of Mr. Hotelz

140,000
100,000
200,000
300,000
240,000

Notes by lawyers on specific properties held:

Real properties inherited from his mother had fair market value at the time of inheritance of
P200,000
Real properties received as gift from his father had fair market value of the time of donation of
P2,550,000
11. Total exclusive properties
12. Total conjugal properties
13. Total deductions on exclusive properties
14. Total deductions on conjugal properties
15. Total share of surviving spouse
16. Amount of vanishing deductions
17. Net taxable estate
18. Estate tax due
CASE C
Mr. and Mrs. Carlos, citizens and residents of the Philippines made the following donations (all from
conjugal properties) in 2015:
January 15:

> To Carina, a legitimate child, on account of marriage, of P300,000 cash

> To Conrado, a legitimate child, cash of P100,000
> To Carissa, a family friend, cash of P20,000

February 1:

> To Carina, cash of P100,000

> To Cess, legitimate child of Mr. Carlos by his previous marriage, and Cent, husband of
Cess, on account of their marriage, P570,000 (donees agree to assume P95,000 of existing
mortgage liability) (executed in Australia)
> To Carlo, father of Mrs. Carlos, cash of P20,000 (executed in United Kingdom)

Mr. and Mrs. Carlos paid a total of P75,000 in Australia and P12,000 in United Kingdom for the February 1
donation (equally shared by Mr. and Mrs. Carlos).
19. Donors tax payable by Mr. Carlos on the January 15 donation
20. Donors tax payable by Mrs. Carlos on the January 15 donation
21. Donors tax payable by Mr. Carlos on the February 1 donation
22. Donors tax payable by Mrs. Carlos on the February 1 donation
23. Deadline for filing and payment of the February 1 donation

CASE D
Domingo, resident and a citizen of Philippines, died with data on conjugal properties (of which P850,000 is
family home) in the Philippines, exclusive properties in Ecuador and Finland, charges thereon and foreign
estate taxes paid, as follows:
Gross estate
Funeral expenses
Medical expenses
Other charges
Foreign estate taxes
paid

Philippines
P 3,000,000
250,000
200,000
400,000

Ecuador
P 1,500,000
250,000
600,000
225,000
15,000

Finland
P 1,500,000
1,000,000
5,000

24. Net taxable estate

25. Total allowable foreign tax credit
26. Estate tax still due
CASE E
Determine the deadline of the following submissions (assume the submission is necessary as per requisites
provided):
Event
Death of Mr. Eli
Death of Mr. Eli
Donation of Mr. Ezekiel to Ernalyn
Death of Mr. Ekko settled through
courts
Death of Ms. Eloisa

Date
Date of death January 15,
2015
Date of death January 15,
2015
Date of donation March 22,
2015
Date of death June 23,
2015
Date of death September
2, 2015

Documentary
Submission
Estate tax return
Notice of death
Donors tax return
Payment of estate tax
payable
Submission of CPA
statement

Deadline