Donor in Philippine Gift Tax Law
Updated June 13, 2026
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Definition
A donor is any person who gratuitously transfers property or money to another person (donee) without receiving equivalent value in return, thereby triggering donor's tax obligations under the National Internal Revenue Code.
Under Section 98 of the National Internal Revenue Code, donor's tax is imposed on the transfer of property by gift by any person, resident or nonresident, whether the gift is direct or indirect and whether the property is real or personal. The donor is the person who makes that gratuitous transfer during his or her lifetime; transfers upon death fall under estate tax instead. The donor is liable for donor's tax on the fair market value of the gift. Since January 1, 2018, the rate under Section 99, as amended by the TRAIN Law, is a flat 6% of total gifts made during the calendar year in excess of ₱250,000, regardless of the relationship between donor and donee.
Detailed explanation
Definition
A donor is any person, natural or juridical, who during his or her lifetime transfers property or money to another person (the donee) without receiving equivalent value in return. Under Section 98 of the National Internal Revenue Code, donor's tax is imposed on the transfer by any person, resident or nonresident, of property by gift, whether the gift is direct or indirect and whether the property is real or personal, tangible or intangible.
Key Characteristics of a Donor
Gratuitous Transfer
The defining feature of a gift is that the transfer is made without full consideration. If the donee pays fair market value, there is no gift. If property is transferred for less than an adequate and full consideration, the amount by which the fair market value exceeds the consideration is deemed a gift, except for real property subject to capital gains tax under Section 24(D) and bona fide, arm's-length sales in the ordinary course of business (NIRC §100).
Intent to Benefit
A donation usually reflects an intent to benefit the donee, whether from affection, family duty, or charity. For tax purposes, the motive does not change the result: a transfer for less than full value is treated as a gift to the extent of the difference (NIRC §100).
Capacity to Transfer
A donor must have legal capacity to make the gift under civil law. Donations between spouses during the marriage are void under Article 87 of the Family Code, except moderate gifts on occasions of family rejoicing.
Donor's Tax Obligations
Tax Rate
Effective January 1, 2018 (TRAIN Law, RA 10963), donor's tax for each calendar year is 6% of total gifts in excess of ₱250,000 (NIRC §99(A)). This replaced the former schedule of 2% to 15% for relatives and the 30% rate for gifts to strangers. The 6% rate applies regardless of the amount or the relationship to the donee.
Taxable Gift Amount
A gift of property is valued at its fair market value at the time of the gift; real property is valued at the higher of the BIR zonal value and the assessor's value (NIRC §102, §88(B)). The ₱250,000 exempt amount applies to each donor's total gifts for the calendar year, not to each donee. Gifts to the national government and its political subdivisions, and gifts to qualifying non-profit educational, charitable, religious, cultural or social welfare institutions that use not more than 30% for administration, are exempt (NIRC §101(A)).
Filing and Payment
A donor files a Donor's Tax Return (BIR Form 1800) within 30 days after the date the gift is made, and the tax is paid at the time of filing (NIRC §103(B)). Late filing or payment results in a 25% surcharge and interest at 12% a year (NIRC §248, §249).
Who Is a Donor
Natural Persons
Any individual, whether Filipino citizen, resident alien, or non-resident alien, may be a donor. For a donor who is a nonresident alien at the time of the gift, property situated outside the Philippines is excluded from the gross gift (NIRC §104).
Juridical Persons
Section 98 applies to transfers by any person, so corporations, partnerships, and other entities that make gratuitous transfers can also be donors.
Donor vs. Testator
A donor makes gifts during lifetime. A testator leaves property by will, and that transfer upon death is subject to estate tax (6% of the net estate under TRAIN, NIRC §84), not donor's tax. A person may be both: they may make lifetime gifts (as a donor) and leave a will (as a testator).
Common Donor Scenarios in the Philippines
A parent gifts ₱500,000 to a child for education: the parent is the donor. A business owner transfers company shares to a family member without payment: the owner is the donor. A retiree donates ₱1,000,000 to a qualifying non-profit educational foundation: the retiree is the donor, but the gift is exempt under NIRC §101(A)(2).
Why it matters
Filipino taxpayers who give gifts, whether to family, friends, or charities, must understand their role as donors and their tax obligations. Failure to file a Donor's Tax Return or pay the 6% tax can result in a surcharge, interest, and legal consequences. Knowing that the ₱250,000 exempt amount is counted per donor for the whole calendar year, and which gifts are exempt (gifts to the government and to qualifying non-profit institutions), helps donors stay compliant with BIR requirements.
How it works
Identify the Gift
Determine whether a transfer is gratuitous. If the donee pays full fair market value, there is no gift. If property is sold for less than its fair market value, the difference is treated as a gift, except for real property covered by the capital gains tax under Section 24(D) and sales made in the ordinary course of business at arm's length (NIRC §100).
Calculate Taxable Gift
Determine the fair market value of the property at the time of the gift; for real property, use the higher of the BIR zonal value and the assessor's value. Add up all gifts you made during the calendar year, leave out gifts exempt under Section 101 (such as gifts to the national government or to qualifying non-profit institutions), and subtract the ₱250,000 exempt amount (NIRC §99, §101, §102).
Compute Tax and File Return
Multiply the total gifts in excess of ₱250,000 by 6% and subtract any donor's tax already paid on earlier gifts in the same year. File BIR Form 1800 (Donor's Tax Return) within 30 days after the date of the gift. Attach proof of value such as the deed of donation and the tax declaration of real property.
Pay Tax and Keep Records
Pay the tax at the time of filing, within 30 days after the gift (NIRC §103(B)). Keep copies of the return, proof of payment, and supporting documents. For real property and shares, the BIR issues an electronic Certificate Authorizing Registration once the tax is paid, which is needed to transfer title.
Examples
Parent gifts ₱500,000 to child for college
Maria Santos transfers ₱500,000 to her son Juan for tuition and makes no other gifts that year. Taxable amount = ₱500,000 − ₱250,000 (annual exempt amount) = ₱250,000. Donor's tax = ₱250,000 × 6% = ₱15,000. Maria files BIR Form 1800 within 30 days and pays ₱15,000 (NIRC §99(A), §103).
Spouse transfers real property to spouse
Roberto wants to donate a house worth ₱2,000,000 to his wife Anna. Under Article 87 of the Family Code, donations between spouses during the marriage are void, except moderate gifts on occasions of family rejoicing. The Tax Code has no exemption for gifts between spouses; the transfer simply cannot be made as a valid donation.
Business owner transfers shares to family member
Carlos owns 60% of a corporation valued at ₱5,000,000. He gifts 30% (₱2,500,000 fair market value) to his daughter and makes no other gifts that year. Taxable amount = ₱2,500,000 − ₱250,000 = ₱2,250,000. Donor's tax = ₱2,250,000 × 6% = ₱135,000 (NIRC §99(A), §102).
Retiree donates to registered charity
Pedro, age 70, donates ₱1,000,000 to a non-stock, non-profit educational foundation that uses not more than 30% of gifts for administration. The gift is exempt from donor's tax under NIRC §101(A)(2), so it does not count toward his taxable gifts for the year.
Multiple gifts to same donee in one year
Angela gifts ₱150,000 to her nephew in January and ₱200,000 in June, and makes no other gifts that year. Total gifts = ₱350,000. Taxable amount = ₱350,000 − ₱250,000 (annual exempt amount for all her gifts in the year) = ₱100,000. Donor's tax = ₱100,000 × 6% = ₱6,000, due with the return for the June gift (NIRC §99(A)).
Common misconceptions
- Myth: A donor only pays tax if the gift exceeds ₱1,000,000.
- Fact: Donor's tax of 6% applies to total gifts in a calendar year in excess of ₱250,000. The ₱250,000 is counted per donor, across all donees, and a return is filed within 30 days after each gift (NIRC §99(A), §103).
- Myth: Gifts to family members are always tax-free.
- Fact: Gifts to relatives are taxed the same way as gifts to anyone else, at 6% of total gifts above ₱250,000 a year. TRAIN removed the old exemption for dowries to children, and donations between spouses during marriage are void under Article 87 of the Family Code (NIRC §99, §101, as amended by RA 10963).
- Myth: A donor can avoid tax by not filing a return.
- Fact: Failure to file BIR Form 1800 within 30 days incurs a 25% surcharge plus 12% annual interest on unpaid tax (NIRC §248, §249). The BIR may assess the tax based on evidence of the gift, and title to donated real property cannot be transferred without proof of payment.
- Myth: The donor's tax rate varies based on the donee's relationship to the donor.
- Fact: The donor's tax rate is a flat 6% for all donors and all donees under TRAIN (RA 10963, effective January 1, 2018). TRAIN removed the separate 30% rate for gifts to strangers, so the relationship no longer affects the tax (NIRC §99).
Questions people ask
What is the difference between a donor and a donee?
A donor is the person who gives the gift; a donee is the person who receives it. Donor's tax is paid by the donor. The donee does not include the gift in his or her gross income for income tax purposes (NIRC §32(B)(3), §98).
Is there donor's tax if my gifts total ₱250,000 or less?
No tax is due if the total gifts you make during the calendar year do not exceed ₱250,000. The ₱250,000 is counted per donor for the whole year, not per donee, so gifts to different people are added together. The law still requires a return within 30 days for every gift that is not exempt under Section 101 (NIRC §99(A), §103).
What happens if I do not file Form 1800 on time?
The BIR may assess the tax due plus a 25% surcharge and 12% annual interest from the due date. Willful failure to file can also be prosecuted. File and pay as soon as possible to stop interest from running (NIRC §248, §249, §255).
Can a non-resident alien be a donor in the Philippines?
Yes. Donor's tax applies to transfers by any person, resident or nonresident. For a donor who is a nonresident alien at the time of the gift, property situated outside the Philippines is not included in the gross gift (NIRC §98, §104).
How do I prove the fair market value of a gift for tax purposes?
The amount of a gift of property is its fair market value at the time of the gift. For real property, the value is the higher of the BIR zonal value and the fair market value in the provincial or city assessor's schedule. The BIR may assess additional tax if a gift is undervalued (NIRC §88(B), §102).
If I gift property to a charity, do I owe donor's tax?
No, if the donee is a qualifying non-stock, non-profit educational, charitable, religious, cultural or social welfare institution, accredited non-government organization, or similar organization, and not more than 30% of the gift is used for administration. Gifts to the national government and its political subdivisions are also exempt. Gifts to organizations that do not qualify are taxed at 6% (NIRC §101(A)).
Can I reduce my donor's tax by claiming the donee as a dependent?
No. Donor's tax is separate from income tax and is not affected by dependent status, and personal or dependent exemptions no longer exist for income tax either. The only relief is the ₱250,000 annual exempt amount per donor and the exemptions under Section 101 for gifts to the government and qualifying non-profit institutions (NIRC §99, §101).
In practice
- A parent planning to gift property to children should file BIR Form 1800 and pay the 6% tax within 30 days to avoid a surcharge and interest.
- Donors often spread gifts across calendar years, because the ₱250,000 exempt amount applies to each donor's total gifts for each calendar year.
- Donors to charities check that the recipient is a qualifying non-stock, non-profit institution or accredited non-government organization before treating the gift as exempt under Section 101.
- Real estate gifts are valued at the higher of the BIR zonal value and the assessor's fair market value; the BIR may assess additional tax plus interest on undervalued transfers.
- Selling property to a relative for less than its fair market value can trigger donor's tax on the difference, except for real property covered by the 6% capital gains tax and arm's-length sales in the ordinary course of business (NIRC §100).
Next steps
Learn more
Donor'S Tax Calculator Compute Tax On Gratuitous Transfers
Gift Tax Calculator Determine Liability On Property Gifts
BIR Form 1800 Donor'S Tax Return
BIR Form 1801 Estate Tax Return
Donor'S Tax Guide Complete Filing Instructions
Property Transfer Tax Guide All Transfer Taxes Explained
Gift Tax Vs Donor'S Tax Understanding The Differences
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Sources & References (3)
Primary sources and the laws, regulations, and official issuances this page relies on. Each citation links directly to the issuing authority’s document.
- LawPhil Project (Arellano Law Foundation). “NIRC §98-101 as amended by RA 10963 to 6% donor's tax over P250,000 annual net gift exclusion; BIR Form 1800.” lawphil.net. Republic Act No. 10963 (TRAIN), amending NIRC Title III (Donor's Tax). Accessed .
- Bureau of Internal Revenue. “BIR: Donor's Tax (6% flat, P250k exclusion, BIR Form 1800, 30-day filing).” bir.gov.ph. Bureau of Internal Revenue, Donor's Tax. Accessed .