BIR Ruling

January 14, 1970 Mr. Alberto R. Dominguez 856 Maria Cristina St. Sampaloc, Manila S i r : This refers to your letter dated January 5, 1970 stating the following: "Last year the Estate of the lates Mrs. Paz M. Vda. de Dominguez, was transferred to the heirs (children of the deceased) and the corresponding estate and inheritance taxes paid. Among others are two pieces of land with buildings which are under lease to tenants. The Real Estate Dealers Tax for 1968 was in the name of "Paz M. Vda. de Dominguez", while in 1969 the Real Estate Dealers Tax was paid by one of the heirs 'Lourdes C. Dominguez' as taxpayer (administratrix or manager) for the Registered Business name of 'Heirs of Paz Dominguez' with all the heirs as Co-owners. The amounts paid for each year was P300.00 for the tax. cdt "The total gross rentals received last 1969 amounted to P14,680.00 so that the corresponding share of each heir as co-owner is only P2,446.66. "1. Is the payment of the Real Estate Dealers tax in the name of 'Lourdes C. Dominguez' correct or should it be in the name of 'Heirs of Paz Dominguez' the registered business name. "2. In view of the share of each co-owner is only P2,446.66 which is less than P3,000 per annum, may the Real Estate Dealers Tax be dispensed with (or exempted for 1970 and henceforth) under present existing laws and regulations." In reply, I have the honor to inform you that inasmuch as the real properties inherited remain undivided among the heirs, the real estate dealer's fixed tax should be paid in the name of "Heirs of Paz Dominguez", the registered business name of the co-ownership and not in the name of the heirs. As regards your liability and your co-owners to the real estate dealer's fixed tax, you and your co-owners are liable to said tax only in your collective and not individual capacity. Hence, the Heirs of Paz Dominguez remain subject to the P300.00 real estate dealer's fixed tax under Section 182 (A) (3) (aa) of the Tax Code, as amended by Republic Act No. 6110, it being represented that its rental income for 1969 is P14,680. casia Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue