BUSINESS AND TRANSFER TAXATION 5th Edition (BY: VALENCIA & ROXAS) 72 SUGGESTED ANSWERS

Chapter 14: DOCUMENTARY STAMP TAXES

CHAPTER 14

DOCUMENTARY STAMP TAXES

Problem 14 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 14 2 B Documentary stamp tax to be paid (P1,000/P200) x P10 x P2 Problem 14 3 A Documentary stamp tax to be paid ($5,000 x P40/P200) x P0.30 Problem 14 4 B DST on first P5,000 DST on excess of the first P5,000 = (P395,000/P5,000) x P10 Total documentary stamp tax Problem 14 5 C Documentary stamp tax (P800,000/P1,000) x P15 Problem 14 6 D DST on first P2,000 DST on excess of the first P2,000 = (P142,000/P1,000) x P1 Total Multiply by Total documentary stamp tax Problem 14 7 Face value of the bonds Divide by Multiply by documentary stamp tax Documentary stamp tax Problem 14 8 Par value of the stock (P100 x 1,000 shares) Divide by Multiply by documentary stamp tax Documentary stamp tax Problem 14 9 Par value (P100 x 100 shares) Divide by value P 100 P 300 P 20 790 P810 P12,000 P 3 142 P145 2 P290 P50,000 200 250 P 1.50 P 375 P100,000 200 500 P 2.00 P 1,000 P10,000 200

BUSINESS AND TRANSFER TAXATION 5th Edition (BY: VALENCIA & ROXAS) 73 SUGGESTED ANSWERS
Chapter 14: DOCUMENTARY STAMP TAXES

Multiply by documentary stamp tax Documentary stamp tax Problem 14 10 Face value of document Divide by Multiply by documentary stamp tax rate Documentary stamp tax Problem 14 11 Face value of document (P50 x $5,000) Divide by Multiply by documentary stamp tax rate Documentary stamp tax Problem 14 12 Insurance policy Divide by Multiply by documentary stamp tax rate Documentary stamp tax Problem 14 13 Annual insurance premium Divide by Multiply by documentary stamp tax rate Documentary stamp tax Problem 14 14 The documentary stamp tax on the affidavit of loss is P15.00. Problem 14 15 The documentary stamp tax would be P10.00. Problem 14 16 Sales price Less: Unpaid mortgage balance Balance Less: Amount not subject to DST Balance Divide by Multiply by Documentary stamp tax Add: DST for the first P1,000 Total documentary stamp tax

P P

50 1.50 75

P100,000 200 500 P 0.30 P 150 P250,000 200 1,250 P 0.30 P 375 P1,000,000 200 5,000 P 0.50 P 2,500 P P P 5,000 4 1,250 0.50 625

P1,000,000 200,000 P 800,000 1,000 P 799,000 P 1,000 799 P 15 P 11,985 15 P 12,000

BUSINESS AND TRANSFER TAXATION 5th Edition (BY: VALENCIA & ROXAS) 74 SUGGESTED ANSWERS
Chapter 14: DOCUMENTARY STAMP TAXES

Problem 14 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 Problem 14 18 a. P 0 b. P 0

P15,000 3,750 250 P19,000

See page 503 of the textbook. Deeds of property donated to the government are exempt from documentary stamp tax.