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    BIR Ruling No. 128-2013

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    Mary Ann Celeste Leuterio
    The document discusses a request for exemption from donor's tax on a donation of four parcels of land from one individual to a religious corporation. The Bureau of Internal Revenue ruled that the donation is exempt from donor's tax as long as no more than 30% of the donation is used for administrative purposes by the donee. The deed of donation is also not subject to documentary stamp tax.

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    BIR Ruling No. 128-2013

    Uploaded by

    Mary Ann Celeste Leuterio
    51 views3 pages
    The document discusses a request for exemption from donor's tax on a donation of four parcels of land from one individual to a religious corporation. The Bureau of Internal Revenue ruled that the donation is exempt from donor's tax as long as no more than 30% of the donation is used for administrative purposes by the donee. The deed of donation is also not subject to documentary stamp tax.

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    BIR RULING

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    The document discusses a request for exemption from donor's tax on a donation of four parcels of land from one individual to a religious corporation. The Bureau of Internal Revenue ruled that the donation is exempt from donor's tax as long as no more than 30% of the donation is used for administrative purposes by the donee. The deed of donation is also not subject to documentary stamp tax.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    51 views3 pages

    BIR Ruling No. 128-2013

    Uploaded by

    Mary Ann Celeste Leuterio
    The document discusses a request for exemption from donor's tax on a donation of four parcels of land from one individual to a religious corporation. The Bureau of Internal Revenue ruled that the donation is exempt from donor's tax as long as no more than 30% of the donation is used for administrative purposes by the donee. The deed of donation is also not subject to documentary stamp tax.

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    © All Rights Reserved
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    of 3

    April 4, 2013

    BIR RULING NO. 128-13

    Sec. 101 (A) (3) of the Tax Code of 1997;


    BIR Ruling No. 300-2011

    Atty. Geraldine E. Jorda


    Sto. Niño Pilgrim Center
    Osmeña Blvd. cor. Burgos St.
    Cebu City

    Ma'am :

    This refers to your letter dated 16 August 2011 indorsed to this Of ce by


    Revenue Region No. XIII, Cebu City on September 1, 2011, requesting exemption from
    donor's tax on the donation of four (4) parcels of land executed by Fr. Jerome P.
    Mesina ("Donor") in favor of the Prior Provincial of the Augustinian Province of Santo
    Niño de Cebu-Philippines, Inc. ("Donee").
    Documents submitted show that on 16 June 2011, the Donor, with Tax
    Identi cation No. (TIN) 232-292-311, executed a Deed of Donation in favor of the
    Donee, a non-stock, non-pro t religious corporation sole, with TIN 000-655-179,
    represented by Fr. Eusebio B. Berdon, OSA, over four (4) parcels of land located at
    Tolotolo, Consolacion, Cebu, particularly described as follows:
    1. A parcel of residential land, described as Lot No. 12000, Cad 545-D
    (New), containing an area of 10,747 sq.m., more or less, covered by
    Original Certificate of Title (OCT) No. OP-56634;
    2. A parcel of residential land, described as Lot No. 7623, Cad 545-D
    (New), containing an area of 10,845 sq.m., more or less, covered by
    Original Certificate of Title (OCT) No. OP-56635;
    3. A parcel of residential land, described as Lot No. 7636, Cad 545-D
    (New), containing an area of 25,882 sq.m., more or less, covered by
    Original Certificate of Title (OCT) No. OP-56707; and
    DCASIT

    4. A parcel of residential land, described as Lot No. 7942, Cad 545-D


    (New), containing an area of 4,349 sq.m., more or less, covered by
    Original Certificate of Title (OCT) No. OP-56708.
    that while the above described properties are registered in the name of the Donor, the
    true and bene cial owner thereof is the Donee; that as an act of liberality in order to
    formalize the ownership of the said properties, the Donor voluntarily and freely
    conveyed by way of donation unto the Donee the said four (4) parcels of land.
    In support of the request, the following documents were submitted:
    1. Letter request for exemption;
    2. Certi ed True Copy of the Certi cate of Registration with the
    CD Technologies Asia, Inc. © 2016 cdasiaonline.com
    Securities and Exchange Commission (SEC) and Articles of
    Incorporation of the Donee;
    3. Duplicate Original of the Deed of Donation;
    4. Certified True Copy of the donor's tax return;
    5. Certi ed True Copy of the Original Certi cates of Title of the donated
    lots;
    6. Certified True Copy of the Tax Declarations of the donated lots; and
    7. Certified True Copy of BIR Certificate of Registration of the Donee.
    In reply, please be informed that gifts in favor of an educational and/or charitable,
    religious, cultural or social welfare corporation, institution, accredited nongovernment
    organization, trust or philanthropic organization or research institution or organization
    is exempt from the payment of the donor's tax pursuant to Section 101 (A) (3) of the
    Tax Code of 1997, as amended, subject to the condition that not more than 30% of said
    gift shall be used by the donee for administration purposes.
    Inasmuch as the Prior Provincial of the Augustinian Province of Santo Niño de
    Cebu-Philippines, Inc. is a religious corporation sole, any donation to it is exempt from
    the payment of donor's tax pursuant to the above provisions of the Tax Code subject to
    the condition that not more than thirty percent (30%) of said donation shall be used by
    the donee for administration purposes. In case of donation of real property, the
    Register of Deeds shall annotate this condition at the back of the TCT/OCT because
    failure to comply with the said condition shall be a ground for the revocation of the
    exemption from the payment of the donor's tax.
    Section 185 of Revenue Regulations No. 26, otherwise known as the Revised
    Documentary Stamp Tax Regulations, implementing Title VII of the Tax Code, provides
    that conveyances of realties not in connection with a sale, to trustees or other persons
    without consideration are not taxable. Accordingly, the aforesaid deed of donation is
    likewise, not subject to the documentary stamp tax prescribed under Section 196 of
    the Tax Code, as amended, but only to the documentary stamp tax of P15.00 imposed
    under Section 188 of the same Code. (BIR Ruling No. 300-2011 dated August 12, 2011)
    Furthermore, if the donor is a VAT-registered person and the donation is an
    ordinary asset, the donation is subject to VAT pursuant to Section 4.106-7 of Revenue
    Regulations (RR) No. 16-2005, as amended, the same being considered a transaction
    deemed sale. But, if the donor is not a VAT-registered person, the donation is exempt
    from VAT. THIcCA

    It is to be noted that if the same property acquired by donation is subsequently


    conveyed by way of sale or exchange, the sale will be subject to corporate income tax
    on the gain realized which is determined by deducting from the gross selling price the
    historical cost or the adjusted basis thereof, as it would be in the hands of the donor,
    pursuant to Section 27 in relation to Section 101, both of the Tax Code of 1997, as
    amended, and consequently to the creditable expanded withholding tax under Section
    2.57.2 of RR No. 2-98, as amended. If Prior Provincial of the Augustinian Province of
    Santo Niño de Cebu-Philippines, Inc. donates the same property donated to it to a non-
    exempt donee, it shall be liable for donor's tax pursuant to Section 98 of the Tax Code
    of 1997, as amended.
    This ruling is being issued on the basis of the foregoing facts as represented.
    CD Technologies Asia, Inc. © 2016 cdasiaonline.com
    However, if upon investigation, it will be disclosed that the facts are different, then this
    ruling shall be considered null and void.

    Very truly yours,

    (SGD.) KIM S. JACINTO-HENARES


    Commissioner of Internal Revenue

    CD Technologies Asia, Inc. © 2016 cdasiaonline.com

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