Mr. Jovencio V. Oliveros, Sr.

January 6, 2009 BIR RULING [DA-(I-001) 002-09] DA526-05 Mr. Jovencio V. Oliveros, Sr. No. 13 I. Villegas Street San Francisco Del Monte Quezon City Sir : This refers to your letter dated May 8, 2008 stating that you are the registered owner of a parcel of land together with the improvements thereon covered by TCT No. N-199082 issued by the Registry of Deeds for Quezon City; that on the other hand, Armando V. Oliveros is the registered owner of a parcel of land together with the improvements thereon covered by TCT No. N-199295 issued by the Registry of Deeds for Quezon City; that the aforesaid properties were acquired by virtue of two (2) separate Deeds of Absolute Sale from Salvador D. Oliveros and Corazon Victoria on November 16, 1998 and November 13, 1998, respectively; that through confusion and errors inadvertently committed the aforesaid properties were allotted as follows, the property sold to you should have been Lot 10-D-3 with an area of 68.04 square meters while the lot allotted to Armando V. Oliveros should have been Lot 10-D-2 with an area of 67.73 square meters; that to correct the error in the technical descriptions, the parties decided to voluntarily exchange the said properties without any monetary consideration; and that on October 3, 2008, Armando V. Oliveros and you have executed a Deed of Exchange to rectify the error in the technical description. ADcEST Based on the foregoing circumstances, you now request for exemption from the payment of capital gains tax and documentary stamp tax relative to the swapping of real properties to rectify the error through a Deed of Exchange and made without monetary consideration. In reply thereto, please be informed that considering that the swapping of the above-mentioned properties is without any monetary consideration, and considering further that the purpose of executing a Deed of Exchange is merely to correct a mistake inadvertently committed in designating the metes and bounds of the above-described properties, this Office holds that the said swap transaction is not subject to the capital gains tax imposed under Section 24 (D) (1) of the Tax Code of 1997 nor to the creditable withholding tax imposed under Section 57 thereof, as implemented by Revenue Regulations No. 2-98, as amended. Furthermore, the Deed of Exchange is not subject to the documentary stamp tax imposed under Section 196 of the Tax Code of 1997, as amended, but only to the P15.00 documentary stamp tax imposed under Section 188 of the said Code. 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.) JAMES H. ROLDAN Assistant Commissioner Legal Service