Missionary Servants of the Blessed Sacrament

March 4, 2010 BIR RULING [DA-(DT-004) 039-10] Section 101 (A) (3); DA-048-06 dated February 15, 2006; ENPS-014-2008 dated February 22, 2008; DA-329-2008 dated May 30, 2008 Missionary Servants of the Blessed Sacrament PO Box 025-5100 San Jose Occidental Mindoro Attention: Sr. Rosanna Favero, MSBS Local Superior Mesdames : This refers to your letter dated February 24, 2010 requesting for exemption from the payment of donor's tax on your donation of a parcel of land pursuant to the provisions of Sec. 101 of the Tax Code of 1997. It is represented that Missionary Servants of the Blessed Sacrament, Inc. is a religious congregation engage in different missionary apostolate. On February 2, 2010, you executed a Deed of Donation in favor of the Mother Caterina School, Inc., an educational institution with Tax Identification Number 005-957-282-000, over a parcel of land with improvements covered by Tax Certificate of Title No. T-12258, situated in Mabini Extension, Barangay Labangan, San Jose, Province of Occidental Mindoro, containing an area of One Thousand Five Hundred Four (1,524) * square meters. In reply, please be informed that gifts in favor of an educational and/or charitable, religious, cultural or social welfare corporation, institution, accredited nongovernment organization, trust or philanthropic organization or research institution or organization is exempt from the payment of the donor's tax pursuant to Section 101 (A) (3) of the Tax Code of 1997, as amended, subject to the condition that not more than 30% of said gift shall be used by the donee for administration purposes. (DA-329-2008 dated May 30, 2008) AHECcT Inasmuch as Mother Caterina School, Inc. is an educational institution, any donation to it is exempt from the payment of donor's tax pursuant to the above provisions of the Tax Code subject to the condition that not more than thirty percent (30%) of said gift shall be used by the donee for administration purposes (ENPS-014-2008 dated February 22, 2008). In case of donation of real property, the Register of Deeds shall annotate this condition at the back of the Transfer Certificate of Title because failure to comply with the said condition shall be a ground for the revocation of the donation pursuant to Article 764 of the New Civil Code. Section 185 of Regulations No. 26, otherwise known as the Revised Documentary Stamp Tax Regulations, implementing Title VII of the Tax Code, provides that conveyances of realties not in connection with a sale, to trustees or other persons without consideration are not taxable. Accordingly, the deed of donation is likewise, not subject to the documentary stamp tax prescribed under Section 196 of the Tax Code, as amended, but only to the documentary stamp tax of P15.00 imposed under Section 188 of the same Code. (BIR Ruling No. DA-048-06 dated February 15, 2006). 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.) MARISSA O. CABREROS OIC-Assistant Commissioner Legal Service