BIR Ruling [DA-259-00]

June 9, 2000 BIR RULING [DA-259-00] 24 (D), 40 (A); 174-90; 174-90; DA-259-2000 Ms. Lorna Esperanza #28 Nstra. Sra. De Soledad St. San Antonio Valley 9 Paraaque, Metro Manila M a d a m : This refers to your letter dated February 28, 2000 requesting in effect for exemption from the payment of the capital gains and documentary stamp taxes in connection with your intention to assign your right over a condominium unit (Storage Unit #ST3C) at Pasong Tamo Tower located at Pasong Tamo Ave., Makati City, in favor of Mr. & Mrs. David M. Quinio, Jr. In reply, please be informed that assignment of rights in real property is not subject to capital gains tax under Section 24(D)(1) of the Tax Code of 1997 because in assignment of rights, the assignee merely steps into the shoes of the assignor without acquiring a better right than what the assignor had in the property to which the right assigned pertains while the title or ownership thereof still remains with the developer. However, any gain realized by you from and as a consequence of such assignment is subject to income tax. The Deed of Assignment, however, is subject to the P15.00 documentary stamp tax imposed under Section 188 of the Tax Code of 1997. 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 from that as represented, then this ruling shall be considered null and void. LexLib Very truly yours, Commissioner of Internal Revenue By: (SGD) LILIAN B. HEFTI OIC, Deputy Commissioner Legal and Inspection Group