BIR Ruling [DA-110-06]

March 15, 2006 BIR RULING [DA-110-06] 101 (A) (3); DA355-05 King Capuchino Tan & Associates 2nd Floor Belman II Building Quezon Avenue cor. Cordillera Street Quezon City Attention: Atty. Bayani L. Chua Gentlemen : This refers to your letter dated December 27, 2005 stating that your clients, Filipino-Chinese Amateur Athletic Federation, Inc. (FCAAF) and FCAAF Athletic Foundation, Inc. are both non-stock, non-profit corporations duly registered with the Securities and Exchange Commission (SEC); that FCAAF is the registered owner of several condominium units covered by Condominium Certificate of Title Nos. 32187, 32188, 32189 and 32190 issued by the Registry of Deeds for Manila having acquired the same from the Oro del Sur Industrial Corporation on March 22, 1999; that in 2001, FCAAF, Inc. decided to establish FCAAF Athletic Foundation, Inc. as the operating arm and project implementor of FCAAF, Inc.; that the Board of Trustees of FCAAF, Inc. unanimously agreed to register the ownership of the above-stated condominium units to FCAAF Athletic Foundation, Inc.; that on February 17, 2006, a Deed of Donation was executed by FCAAF, Inc. in favor of FCAAF Athletic Foundation, Inc. whereby the former as an act of liberality and generosity transferred to the latter the above-mentioned condominium units without any consideration. In connection therewith, you now request exemption from the payment of donor's tax under Section 101(A)(3) of the Tax Code of 1997 on the transfer of the condominium units by FCAAF. Inc. to FCAAF Athletic Foundation, Inc., a non-stock, non-profit corporation organized under Section 30(E) of the said Code. In reply thereto, please be informed that inasmuch as the donee is a non-stock, non-profit, corporation organized under Section 30(E) of the Tax Code of 1997, the aforesaid donation is exempt from the payment of donor's tax pursuant to Section 101(A)(3) of the said Code, subject to the condition that not more than 30% of the said gift shall be used by the donee for administration purposes. Moreover, the Deed of Donation is not subject to documentary stamp tax. However, the acknowledgement on said deed is subject to the documentary stamp tax of P15.00 imposed under Section 188 of the Tax Code of 1997. ( BIR Ruling No. DA481-98 dated November 9, 1998; DA355-05 dated August 22, 2005 ) 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. EIDTAa Very truly yours, (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service