BIR Ruling [DA-542-99]

September 21, 1999 BIR RULING [DA-542-99] Ms. Muriel Macaraeg Esteban c/o The Probe Team 13 Matipid Street, Sikatuna Village Diliman, Quezon City M a d a m : This refers to your letter dated September 15, 1999 requesting, in favor of your father, Mr. Catalino Macaraig, Jr., for further exemption from the payment of capital gains and documentary stamp taxes in connection with his intention to likewise assign to you his right over a parking space (LB 111) at the Cityland Pioneer located at Pioneer Street, Mandaluyong City; and that we have issued to your said father our BIR Ruling No. DA-477-99 regarding his assignment of rights to you over a condominium unit (unit 736) which ruling is quoted as follows: ". . . assignment of rights in real property is not subject to the 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 . LibLex "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." In reply, please be informed that your father's further request for the exemption from the payment of capital gains and documentary stamp taxes on the assignment of right to you over the parking space (LB 111) located in the same building is hereby granted for the same reason mentioned in the aforementioned ruling. However, any gain realized by him from you and as a consequence of such assignment is subject to income tax. Very truly yours, Commissioner of Internal Revenue By: (SGD.) SIXTO S. ESQUIVIAS IV Deputy Commissioner (Legal & Enforcement Group)