Atty. Francisco I. Naputo, CPA

December 3, 2009 BIR RULING [DA-(DT-068) 725-09] 101 (A) (3); DA-329-2008 Atty. Francisco I. Naputo, CPA 73 Apacible St., Philam Village Las Pias City Sir : This refers to your letter dated October 02, 2009 requesting on behalf of your client, Philippine Union Mission Corporation of Seventh-Day Adventists Church ("PUMCO" for brevity) , for exemption from the payment of donor's tax on its proposed donation to South Philippine Adventist College, Inc. (hereinafter called SPAC) . It appears that PUMCO is a non-stock, non-profit religious institution created under the laws of the Republic of the Philippines with SEC Registration No. 1139 with principal office address at NPUM Compound, Donada corner San Juan Sts., Pasay City; that SPAC is a non-stock educational institution which is likewise created under the laws of the Republic of the Philippines with SEC Registration No. 017958, and whose principal office is at Camachiles, Matanao, Davao del Sur; that it is duly recognized by the Department of Education (DepEd) and Commission on Higher Education (CHED), is clothed with authority to conduct and operate a secondary course and various college degrees; and that PUMCO proposes to donate to SPAC the parcel of land encompassing the entire SPAC campus with a total area of approximately Nineteen Thousand Nine Hundred Thirty Eight Point Three hectares (19,938.3 has.), together with all improvements existing thereon, covered by Transfer Certificate of Title (TCT) No. T-3069, issued by the Register of Deeds of the Province of Davao. In reply, please be informed that inasmuch as the donee is an educational institution, donations to it are exempt from the payment of 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. The Register of Deeds shall, however, 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. IDSaEA Moreover, the proposed Deed of Donation that will be executed for the purpose is not subject to documentary stamp tax. 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, as amended. 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.) JAMES H. ROLDAN Assistant Commissioner Legal Service