Chapter 1 (Succession and Transfer Tax)

Mortis causa transfer of property is effected:

• When the property is received by the heir

• When the court awarded the ownership of property to a particular heir

• Upon the death of the decedent

• Upon payment of estate tax

Justification for the imposition of transfer tax.

• Redistribution of wealth theory

• Benefit received theory

• State partnership theory

• All of the choices

The tax imposed on the transfer of property without consideration between two or more persons who are living at the time the transfer is made.

• Estate tax

• Business tax

• Donor's tax

• Personal tax

Which of the following statements is false?

Transfer tax is

• Imposed upon gratuitous transfer of property

• Of two kinds: estate tax and donors' tax

• Classified as national tax

• None of the choices

The object of estate tax is the:

• Right to transmit

• Decedent

• Properties of the decedent

• Beneficiaries

Statement 1: Cancellation of existing debt as payment for services rendered by the debtor is a gratuitous transfer.

Statement 2: A sale is a form of transfer transaction that requires payment of transfer tax.

• Statements 1 and 2 are true

• Statements 1 and 2 are false

• Statement 1 is true but statement 2 is false

• Statement 1 is false but statement 2 is true

Statement 1: A sale on installment basis is considered as an onerous transfer.

Statement 2: A gift out of love to former girlfriend is an onerous transfer.

• Statement 1 is true but statement 2 is false

• Statement 2 is true but statement 1 is false

• Both statements are correct

• Statements 1 and 2 are false

Statement 1: The rights to succession are transmitted from the moment of death of the decedent, notwithstanding the postponement of the actual possession or enjoyment of the estate by the beneficiary.

Statement 2: The heirs succeed immediately to all the property of the deceased ancestor at the moment of death as completely as if the ancestor had executed and delivered to them a deed for the same before his death.

• Only statement 1 is correct

• Only statement 1 is wrong

• Both statements are correct

• Both statements are wrong

Which among the following statements is correct?

• Estate taxation is governed by the statue in force at the time of death of the decedent.

• Estate tax accrues as of the death of the decedent.

• Succession takes place and the right of the State to tax the privilege to transmit the estate vests instantly upon death.

• All of the choices

The tax imposed on the right to transmit property death is known as mortis causa tax.

• True

• False