BIR Ruling

April 19, 1976 St. Joseph's Convent of Perpetual Adoration P. O. Box 155 Quezon City Attention: Sister Mary Clare Dimson Superior Gentlemen : In reply to your letter dated January 19, 1976, I have the honor to inform you that no tax shall be due from you on your purchase of a lot adjacent to your Convent. Moreover, the gain or difference between the acquisition cost and the proceeds of the sale of a part of your property in Baguio shall not be subject to income tax it appearing that the proceeds of such sale would be used in furtherance of the religious and charitable purposes for which the corporation was organized. In the case of Manila Polo Club v. Collector of Internal Revenue (CTA Case No. 293, promulgated August 31, 1959), exemption from the payment of income tax on profits derived from the sale of real properties was granted considering that the disposition was not only incidental but was also necessary to accomplish the purposes for which the Club was organized. (see also Xavier School, Inc. vs. Commissioner, CTA Case No. 1682, October 8, 1969) cdta Very truly yours, CONRADO P. DIAZ Acting Commissioner of Internal Revenue TAN-1182-568-4 "TAXPAYERS SHOULD INDICATE THEIR TAN IN ALL COMMUNICATIONS TO THE BIR."