BIR Ruling [DA-585-04]

November 18, 2004 BIR RULING [DA-585-04] 101 (A) (3);S30-056-2001 Follosco Morallos and Herce Suite 1506, 88 Corporate Center 141 Valero corner Sedeo Sts. Salcedo Village, Makati City Attention: Atty. Rachel P. Follosco Gentlemen : This refers to your letter dated June 14, 2004 requesting on behalf of your client, San Sebastian College-Recoletos, Inc. (SSCRI) for a confirmation of your opinion that the donation of several parcels of land in its favor is exempt from donor's tax and documentary stamp tax. Documents submitted shows that SSCRI is an educational institution possessing requisite Department of Education (DepEd) and Commission on Higher Education (CHED) accreditation/recognition; that it is constituted by members of the religious congregation of the Order of Augustinian Recollects (OAR);that on the other hand, San Ramon Properties, Inc. (now San Ramon Holdings, Inc.) is a corporation duly organized and existing under Philippine laws, and is the owner of several parcels of land covered by Transfer Certificates of Title (TCT) Nos. 174944, 172490, 172502 and 214990 with an area of eighty thousand (80,000) sq.m.;that said properties are all located in an area being developed for mixed purposes ( i.e., residential, industrial, and commercial) at Brgy. Canlubang, Calamba, Laguna; that thru Deeds of Donation, the aforestated properties are donated to SSCRI primarily to serve as a school site to be established by SSCRI; and that the Deeds of Donation further allows SSCRI to use the said lots for purposes incidental to its operation, as well as in the pursuit of its other authorized activities and purposes, as provided under its Articles of Incorporation. TCaSAH In reply, please be informed that inasmuch as the donee is a non-stock, non-profit educational institution, the aforementioned 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 for administration purposes. Moreover, the aforesaid donation is not subject to documentary stamp tax prescribed by Section 196 of the Tax Code of 1997, but only to the documentary stamp tax of P15.00 imposed under Section 188 of the same Code. This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be ascertained that the facts are different, then this ruling shall be considered as null and void. Very truly yours, Commissioner of Internal Revenue By: (SGD.) MILAGROS V. REGALADO Assistant Commissioner Legal Service