Researching Deed of Donation to Married Child
I need to craft a thorough legal article on the Deed of Donation to a married child in the Philippines. This will include topics like legal basis, property relations, donations, tax implications, and more. The article will thoroughly cover the family code, civil code, donations to spouses vs. married children, and other legal considerations. To make it current, I'll need to look into any updates to donor's tax (especially with the TRAIN law). I'll gather specific case laws and sample provisions to provide an accurate view!
Looking up BIR donor's tax regulations
I should check the BIR regulations for donor's tax forms, especially BIR Form 1800, since it's typically due within 30 days of donation. This will ensure I'm providing the most up-to-date and accurate information on tax filing requirements for donations in the Philippines. I'll
Crafting legal article on Deed of Donation to a Married Child
I need to create a well-rounded legal article on the Deed of Donation to a married child in the Philippine context. This will cover essential details like legal basis, property relations, taxes, formalities, parental rights, and more. I’ll include aspects such as legitime, the Family Code, and civil code distinctions, as well as updated info on the BIR donor's tax and TRAIN law. I’ll also incorporate sample provisions, steps, and jurisprudence. Time to dive into those details!
Writing comprehensive article on donation to married child
I need to craft a detailed article focusing on donations to married children, addressing legal limitations and context. I'll highlight that donations between spouses are generally void but may allow moderate gifts in family celebrations. While parents can donate to their children, certain restrictions may apply, especially regarding property types. Jurisprudence, such as the "Heirs of Malate vs CA" and "Spouses Abalos vs Heirs of Gomez" cases, may help clarify property distinctions. Time to delve into these cases for further details!
Structuring the legal article
I’m setting up to create a thorough article on donations to married children in the Philippines. Key sections will include an overview of legal bases
Writing Legal Article on Donation to Married Child
I need to craft the article according to the provided instructions, incorporating citations from multiple sources. While images aren't necessary for a legal article, I'll focus on a text-only format. The article needs to include an outline addressing donation definitions, the legal framework (Civil Code, Family Code, TRAIN law, BIR regulations), and key aspects such as donor capacity, property limitations due to legitime, and donation formalities. Additionally, I'll detail the acceptance process, especially for donations to a married child. Let's structure it accordingly.
Donor's tax and requirements
The donor's tax is set at a 6% flat rate for net gifts above P250k, as outlined by the TRAIN law (RA 10963) effective from Jan 1, 2018. Donors must file Form 1800 within 30 days of making the donation. For real property donations, documentary stamp tax (DST) applies at 1.5%, though certain exemptions can apply. While verifying these details, I’ll also consider potential restrictions like reserva troncal, which could affect property donations to descendants. Need to confirm this concept as well.
For property relations, if the donation is only to a married child, the property becomes their exclusive property (as per Article 92, par. 1), and the spouse does not have co-ownership. However, the fruits or income may follow the community property or conjugal rules depending on the regime.
The donor's tax is 6% for net gifts exceeding P250k, and the tax return requires filing Form 1800 within 30 days. Real property donation may involve documentary stamp tax (DST), often exempted depending on execution. I'll confirm this while reviewing the details further.
Considering donor's tax and restrictions
Under the TRAIN law (RA 10963), donations above P250k are taxed at a 6% flat rate, and donors must file Form 1800 within 30 days. For real property donations, documentary stamp tax applies at P15 for every P1k of the fair market value, with some exemptions. It's useful to consider the concept of reserva troncal in certain
For the BIR eCAR procedures, the donor must file Form 1800, pay the donor’s tax and documentary stamp tax, and then obtain an electronic Certificate Authorizing Registration (eCAR) from the Bureau of Internal Revenue (BIR) to present to the Register of Deeds.
Additionally, for donations of real property, the Local Government Units (LGU) collect a local transfer tax of 0.5% of the fair market value (FMV), which is often referred to as a "donation tax" by the LGU. I'll verify the details.
For the BIR eCAR procedures, the donor needs to file BIR Form 1800, pay the donor’s tax and documentary stamp, then secure an electronic Certificate Authorizing Registration (eCAR) to present to the Register of Deeds.
Additionally, when donating real property, a local transfer tax of 0.5% based on fair market value (FMV) must be paid to the applicable Province or City. This is often called a "donation tax" by LGUs.
Donations to a married child can make the property exclusive to the child. However, if both the child and their spouse are named, the property becomes conjugal or community property.
For this guide, I need to address the
Thought for 1m 31s
Below is an in-depth, practitioner-style primer on Deeds of Donation executed by parents in favor of a married child in the Philippines. It synthesizes the Civil Code, Family Code, National Internal Revenue Code (as amended by the TRAIN Law), Bureau of Internal Revenue (BIR) issuances, Local Government Code provisions, and illustrative jurisprudence. Citations to publicly available sources are embedded.
1. Governing Statutes & Key Doctrines
| Area | Principal Sources | Core Rules |
|---|---|---|
| Civil Code, Title III – Donations | Arts. 725-773 | Requisites, form, revocation grounds, collation. |
| Family Code (E.O. 209, 1987) | Arts. 92, 86-90 | Property acquired “by gratuitous title” during marriage is exclusive property of the donee-spouse; fruits/income follow the couple’s property regime. (Philippine Law Firm) |
| National Internal Revenue Code (NIRC) as amended by RA 10963 (TRAIN) | §99 | Flat 6 % donor’s tax on net gifts above ₱250,000 per calendar year, regardless of relationship. (National Tax Research Center, Salenga Law Firm) |
| BIR Form 1800 & ONETT rules | BIR Form 1800 Guidelines; RMC 56-2024 | File and pay within 30 days from date of donation; eCAR issued by RDO of the property’s location. (Bir CDN, Bir CDN) |
| Documentary Stamp Tax (DST) | NIRC §196 (as amended) | 1.5 % of fair market value (FMV) on donations of real property; payable via BIR Form 2000-OT within 5 days after month-end. (Respicio & Co., mtfcounsel.com) |
| Local Transfer Tax | Local Government Code §§135-136 | Provinces: up to 0.5 % of FMV; Metro Manila cities up to 0.75 %; payable within 60 days to the City/Provincial Treasurer. (Respicio & Co., File Docs Phil) |
2. Capacity & Limitations
Donor (parent) must have free disposal of the property and of the portion disposable by will (Arts. 749, 750).
Donee (married child) must be capacitated to accept; unborn children conceived at the time of donation may be donees (Art. 742; Respicio article). (RESPICIO & CO.)
Extent of donation
- Parents may not impair the legitime of compulsory heirs (Arts. 750-771).
- Donations exceeding the disposable free portion are reducible upon the donor’s death (collation).
Prohibited donations (Arts. 739-743) do not include donations from parents to children, so they are valid.
Reserva troncal warning – If the married child pre-deceases the parents, property that originally came from an ascendant by gratuitous title may be subject to reserva troncal in favor of relatives within the third degree of the line of origin (Art. 891). (Philippine Law Library)
3. Effect on the Married Child’s Property Relations
| Child’s Property Regime | Result of a Sole Donation to the Child | Authority |
|---|---|---|
| Absolute Community of Property (ACP) | Donated property is exclusive of the donee; fruits/income become community property (Art. 91 FC). | Art. 92(1) FC; Spouses Abalos doctrine. (Philippine Law Firm, RESPICIO & CO.) |
| Conjugal Partnership of Gains (CPG) | Exclusive property; fruits/income are conjugal gains (Art. 109 FC). | |
| Separation of Property (by pre-nup or judicial) | Remains exclusive in full, including fruits, unless spouses stipulate otherwise. |
Tip: If parents intend both spouses to own the property, they must name the spouse as co-donee in the deed; otherwise the spouse acquires no title and consent is unnecessary for later dispositions.
4. Form & Formalities
| Type of Property | Mandatory Form | Additional Requirements |
|---|---|---|
| Real property | Public instrument (notarized) “specifying the property donated and the value of the charges the donee must satisfy” plus acceptance in the same or a separate public instrument (Art. 749 CC). | • If acceptance is in a separate deed, donor must be notified in authentic form and the fact noted in both deeds. • Present deed + BIR eCAR to the Registry of Deeds (RD) for annotation/issuance of new TCT. |
| Personal property > ₱5,000 | Donation and acceptance in writing (Art. 748 CC). | Delivery completes transfer; registration not required. |
| Personal property ≤ ₱5,000 | Oral donation valid if accompanied by simultaneous delivery. |
Failure to observe formalities renders the donation void (Art. 748).
5. Step-by-Step Process for a Real-Property Donation to a Married Child
| # | Action | Who |
|---|---|---|
| 1 | Draft Deed of Donation & Acceptance (parents as donors; married child as sole donee; include full technical description & tax dec. nos.). | Counsel/notary |
| 2 | Notarize the deed. | Notary public |
| 3 | Secure BIR ONETT Computation Sheet & pay Donor’s Tax (Form 1800) within 30 days. Attach zonal valuation, tax dec., IDs, marriage certificate of donee, etc. | Donor |
| 4 | Pay DST (Form 2000-OT) within 5 days after month-end. | Donor/Donee |
| 5 | Obtain eCAR from the RDO; validity five (5) years. | Donee |
| 6 | Pay Local Transfer Tax to City/Provincial Treasurer within 60 days. | Donee |
| 7 | Present Deed + eCAR + Treasurer’s receipt to Registry of Deeds; pay registration fees; new TCT issued in donee’s (exclusive) name. | Donee |
| 8 | Update Assessor’s Office tax declaration. | Donee |
6. Taxes & Illustrative Computation
Assume: FMV per zonal value = ₱3 000 000; no prior gifts this year.
| Tax | Base | Rate | Payor | Amount |
|---|---|---|---|---|
| Donor’s Tax | ₱3 000 000 – 250 000 exemption = 2 750 000 | 6 % | Donor | ₱165 000 |
| DST | ₱3 000 000 | 1.5 % | Usually Donee | ₱45 000 |
| Local Transfer Tax (Province) | ₱3 000 000 | 0.5 % | Donee | ₱15 000 |
| Registration Fees | per LRA schedule | – | Donee | ~₱8-10 k |
Late filing surcharges: 25 % (or 50 % if willful) + 12 % annual interest (NIRC §§248-249). (Bir CDN)
7. Revocation & Remedies
| Ground | Who may invoke | Effect |
|---|---|---|
| Birth, adoption, survival of donor’s child after the donation (Art. 760) | Donor | Automatic revocation. |
| Ingratitude – e.g., serious offense, refusal of support (Art. 765) | Donor | Judicial action within one year from knowledge. |
| Non-fulfilment of conditions | Injured party | Judicial action; property reverts to donor. |
Upon revocation, donee must return property + fruits (Art. 766). Registration in RD may still be cancelled upon presentation of final judgment.
8. Collation, Legitimes & Estate Planning Issues
- Compulsory-heir protection – Donation is imputed to the child’s legitime at succession opening (Art. 1061).
- Reduction – Excess portion may be reduced in an action for rescission or reduction filed by co-heirs.
- Reserva troncal traps – If the married child dies childless before the parents, donated property may have to revert to the bloodline of the original ascendant (the donor’s line) rather than the surviving in-law. (RESPICIO & CO.)
9. Special Situations
| Scenario | Key Points |
|---|---|
| Parents want donation to benefit both spouses | Name both spouses as co-donees. Title will be conjugal/communal, and both must sign future dispositions. |
| Donee’s spouse is a foreigner | Foreign nationals cannot own land; donation of Philippine land to both spouses is invalid as to the foreign spouse, but net proceeds of a future sale may be given. (Respicio & Co.) |
| Donation to a minor child | Acceptance must be through the child’s parent-guardian; court approval required if real property will later be sold. |
| Conditional or onerous donation | Allowed if conditions are not contrary to law/morals; consider adding forfeiture clause upon non-compliance. |
| Donation mortis causa | If transfer is to take effect only at death, it is a will, not an inter vivos donation, and must observe testamentary formalities and estate-tax rules. |
10. Documentary Checklist
- Draft Deed of Donation & Acceptance (with marital status, TINs).
- CTCs of donors’ & donee’s IDs; marriage certificate of donee.
- Certified true copy of TCT/OCT; latest tax declaration & tax clearance.
- BIR zonal valuation print-out; photos of property.
- BIR Forms 1800 (Donor’s Tax) & 2000-OT (DST) with payment slips.
- Approved ONETT Computation Sheet and eCAR.
- Treasurer’s Office transfer-tax receipt.
- RD registration fee receipts; new TCT.
- Updated tax declaration & Real-Property-Tax payment proof.
11. Best-Practice Tips
- Spell out exclusivity – Insert: “This donation is made exclusively in favor of our daughter, Maria dela Cruz, to be her paraphernal property.”
- Reserve usufruct if parents wish to keep using the property.
- Time the filing – Avoid December rush; BIR treats the date on the deed as the taxable date.
- Keep originals & eCAR barcode – Banks and RD will not honor photocopies.
- Update wills & estate plans to reflect large donations and avoid future legitime disputes.
Frequently Asked Questions
| Q | A |
|---|---|
| Does my in-law need to sign? | No, unless the spouse is a co-donee. The donation is the married child’s exclusive property. |
| Can the donated condo be sold without my consent as donor? | Once the deed is registered, ownership transfers; donor consent is not needed. You may, however, impose an explicit non-alienation clause. |
| Is the ₱250k donor’s-tax exemption per child? | No. The exemption is per donor, per calendar year, aggregated over all gifts. |
| What if I give cash instead of land? | Cash donations over ₱250k in a year are still subject to 6 % donor’s tax; use Form 1800 and keep bank proofs. |
| Can I revoke if my child becomes hostile? | Yes, under ingratitude grounds—but you must sue within one year of learning of the act and prove a ground under Art. 765 CC. |
Disclaimer: This article is for general information only and is not a substitute for individualized legal or tax advice. Always consult Philippine-licensed counsel or a tax professional before executing a deed of donation or paying taxes.