BIR Ruling [DA-551-04]

November 5, 2004 BIR RULING [DA-551-04] 101 (A) (3) 013-2003 Lorraine Computer and Technical School, Inc. B. Mendoza St., San Fernando City, Pampanga Attention: Ms. Loreta L. Razon Gentlemen : This refers to your letter dated July 7, 2004 requesting exemption from the payment of donor's tax on the donation of a parcel of land by Ms. Loreta L. Razon to Lorraine Computer & Technical School, Inc . It appears that Lorraine Computer & Technical School, Inc . is a non-stock, non-profit educational institution duly organized and existing under and by virtue of the laws of the Philippines, under the supervision of the Technical Education and Skills Development Authority (TESDA); that the school offer technical, vocational and other short term courses at very affordable fees in order to provide an alternative opportunity to the youths who cannot afford the high cost of collegiate education; that the school have maintained linkages with non-government organizations and private civic organizations for sponsorship of scholarship programs for the benefit of poor but deserving high school graduates of public school who could not afford post secondary education; that Ms. Loreta L. Razon is the absolute and registered owner of a parcel of land situated in San Fernando City, Pampanga, covered by Transfer Certificate of Title No. 247420-R, issued by Registry of Deeds for the Province of Pampanga; and that for and in consideration of the love and affection of Ms. Loreta L. Razon has for the school to attain its educational purposes and as an act of liberality and generosity, she hereby voluntarily and freely gives, transfers and conveys by way of donation unto the said school, its executors, administrators and assigns, all rights, titles and interests which she has in the above-described real property, together with all the buildings and improvements found therein, free from all liens, encumbrances and charges whatsoever. aSTcCE In reply, please be informed that inasmuch as the donee is a non-stock, non-profit educational institution, the aforesaid donation is exempt from the payment of donor's tax pursuant to Section 101(A)(3) of the Tax Code of 1997, subject to the condition that not more than 30% of said gift shall be used by the donee for administration purposes. Moreover, the aforesaid Deed of Donation is not subject to the documentary stamp tax prescribed under Section 196 of the Tax Code of 1997. However, the acknowledgment 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. DA-013-2003 dated July 18, 2003) 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. Very truly yours, (SGD.) MILAGROS V. REGALADO Assistant Commissioner Legal Service