Mariza M. Rabago-Uy

June 25, 2010 BIR RULING [DA-(C-026) 111-10] RA 8763; BIR Ruling 002-03; DA-400-2003 Mariza M. Rabago-Uy OIC-Revenue District Office RDO No. 53-A, Las Pias City Madam : This refers to your Memorandum dated February 25, 2010 requesting for legal opinion as to the taxability of the sale of property by HomeCredit Mutual and Loan Association (HomeCredit). It appears that HomeCredit is a domestic mutual building and loan association duly organized and existing under the laws of the Philippines; that HomeCredit has been operating as a mutual benefit building and loan association whereby its stockholder-members contribute to the capital build-up of the association by way of subscription or fixed dues (regular, equal and periodical payments); that the Bureau previously issued BIR Ruling No. 002-03 dated February 12, 2003 and DA-400-2003 dated November 6, 2003, wherein it was confirmed that HomeCredit, as a building and loan association guaranteed by the Home Guaranty Corporation, is exempt from all taxes; and that HomeCredit sold a parcel of land situated at Barangay Almanza Doz, Las Pias, Metro Manila and covered by TCT No. T-112578 to Abigail Joy D. Gamboa and Ofelia D. Gamboa. In reply, please be informed that Section 20 (d) of R.A. No. 8763, otherwise known as the "Home Guaranty Corporation Act of 2000," provides that when guaranteed by Home Guaranty Corporation, loan associations including their franchises, capital reserves, surplus, and their loans, receipts, and income, shall be exempt from all taxation. It is clear from the above-cited law and BIR ruling that HomeCredit is exempt from capital gains tax or creditable withholding tax on the sale of its real property. This serves as authority for the Revenue District Officer concerned to issue the Certificate Authorizing Registration covering the transfer from HomeCredit to Abigail Joy D. Gamboa and Ofelia D. Gamboa of a parcel of land situated at Barangay Almanza Doz, Las Pias, Metro Manila and covered by TCT No. T-112578. 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, Commissioner of Internal Revenue By: (SGD.) GREGORIO V. CABANTAC Deputy Commissioner