BIR Ruling [DA-078-96]

February 23, 1996 BIR RULING [DA-078-96] Mr. Gregorio Buning Sto. Cristo, Pulilan, Bulacan S i r : This refers to your letter dated July 19, 1995 requesting in effect for exemption from the payment of the corresponding taxes due on the transfer of a parcel of land in your favor. Documents submitted show that the Spouses Leoncio Santiago and Virgencia Sayo are the registered owners of a parcel of land situated in Sto. Cristo, Pulilan, Bulacan covered by Original Certificate of Title No. RO-1287 (0-7129) issued by the Office of the Register of Deeds for the Province of Bulacan with an area of 13,961 square meters; that your piece of land was inadvertently included in the title of the said spouses; and that in order to correct the said mistake, you had the said lot surveyed and have agreed on the following divisions: cd 1) Gregorio Buning Lot 908-A an area of 3,801 square meters 2) Spouses Leoncio Santiago Lot 908-B with an area and Virgencia Sayo of 10,160 square meters In reply, please be informed that since the exchange transaction in question is without any monetary consideration and considering further that the execution of the said "Kasunduan sa Pagsasauli ng Lupa" is merely to correct a mistake, this Office is of the opinion as it hereby holds that the aforementioned transaction is not subject to the capital gains tax, imposed under Section 21(e) of the Tax Code nor to the creditable withholding tax imposed under Revenue Regulations No. 1-90. Furthermore, it is not likewise subject to the documentary stamp tax imposed under Section 196 of the Tax Code. However, the notarial acknowledgment to the said document is subject to the documentary stamp tax of P10.00 only pursuant to Section 188 of the Tax Code, as amended by Republic Act No. 7660. This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. (BIR Ruling No. 027-93 dated January 15, 1993) Very truly yours, ALICIA P. CLEMENO Assistant Commissioner (Legal Service)