Solution manual transfer and business taxes by valencia CHAPTER 14 DOCUMENTARY STAMP TAX

BUSINESS AND TRANSFER TAXATION 5th Edition (BY: VALENCIA & ROXAS) SUGGESTED ANSWERS 72 Chapter 14: DOCUMENTARY STAMP TAXES CHAPTER 14 DOCUMENTARY STAMP TAXES Problem 14 – 1 True True False – the transaction False – to be taxed against the party who is not exempt True False – 10 days from the close of the month True True True 10 True Problem 14 – B Problem 14 – A Problem 14 – B Problem 14 – C Problem 14 – D Documentary stamp tax to be paid (P1,000/P200) x P10 x P2 Documentary stamp tax to be paid ($5,000 x P40/P200) x P0.30 DST on first P5,000 DST on excess of the first P5,000 = (P395,000/P5,000) x P10 Total documentary stamp tax Documentary stamp tax (P800,000/P1,000) x P15 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 – Face value of the bonds Divide by Multiply by documentary stamp tax Documentary stamp tax Problem 14 – Par value of the stock (P100 x 1,000 shares) Divide by Multiply by documentary stamp tax Documentary stamp tax Problem 14 – Par value (P100 x 100 shares) P 100 P 300 P 20 790 P810 P12,000 P 142 P145 P290 P50,000 200 250 P 1.50 P 375 P100,000 200 500 P 2.00 P 1,000 P10,000 BUSINESS AND TRANSFER TAXATION 5th Edition (BY: VALENCIA & ROXAS) SUGGESTED ANSWERS 73 Chapter 14: DOCUMENTARY STAMP TAXES Divide by value 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 P P 200 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 Annual insurance premium Divide by P Multiply by documentary stamp tax rate Documentary stamp tax P P 5,000 1,250 0.50 625 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 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) SUGGESTED ANSWERS 74 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 P15,000 3,750 250 P19,000 Problem 14 – 18 a P – – b P – – See page 503 of the textbook Deeds of property donated to the government are exempt from documentary stamp tax  .. .BUSINESS AND TRANSFER TAXATION 5th Edition (BY: VALENCIA & ROXAS) SUGGESTED ANSWERS 73 Chapter 14: DOCUMENTARY STAMP TAXES Divide by value Multiply by documentary stamp tax Documentary stamp. .. 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 P P 200 50 1.50... Divide by P Multiply by documentary stamp tax rate Documentary stamp tax P P 5,000 1,250 0.50 625 Problem 14 – 14 The documentary stamp tax on the affidavit of loss is P15.00 Problem 14 – 15 The documentary