Gian Paolo V. Dela Concepcion

December 16, 2009 BIR RULING [DA-(I-039) 786-09] Section 24 (D) (1) and Section 196; DA-60-2004 Gian Paolo V. Dela Concepcion Luis Antonino V. Dela Concepcion No. 7 Fordham St., White Plains Quezon City Gentlemen : This refers to your letter dated November 11, 2009 requesting for exemption from the payment of capital gains tax and documentary stamp tax on the swapping of real properties to correct a mistake and without consideration. It is represented that Gian Paolo V. Dela Concepcion, with Tax Identification Number (TIN) 233-424-869, is the registered owner of a parcel of land with improvements thereon as evidenced by Transfer Certificate of Title No. 337912 identified as Lot 9A of the subdivision plan (LRA) PCS-359 approved as a non-subdivision project, being a portion of Lot 9, Blk-15, (LRC) PCS-359 LRC CLR Record No. 699, 875, 917) containing the area of 288 sq. m. more or less; that Luis Antonino V. Dela Concepcion, with Tax Identification Number (TIN) 172-609-727, is likewise presently the registered owner of a parcel of land with improvements thereon as evidenced by Transfer Certificate of Title No. 337913 identified as Lot 9B (corner) of the subdivision plan (LRA) PCS-359 approved as a non-subdivision project, being a portion of Lot 9, Blk-15, (LRC) PCS-359 LRC CLR Record No. 699, 875, 917) containing the same area of 288 sq. m. more or less; that the subject adjoining properties were titled on October 19, 2009; that upon discovery of error of the titling of subject properties, Gian Paolo V. Dela Concepcion and Luis Antonino V. Dela Concepcion have voluntarily agreed to exchange the properties presently registered in their names as specified in the Deed of Exchange of Real Property dated December 7, 2009 without any monetary consideration from any of the parties involved wherein Gian Paolo V. Dela Concepcion (Lot 9A) barters and exchanges his property together with the improvements thereon with that of Luis Antonino V. Dela Concepcion (Lot 9B corner) as intended by the parties that Lot 9A should belong to Luis Antonino V. Dela Concepcion and Lot 9B (corner) should be registered to Gian Paolo V. Dela Concepcion, in order to correct the mistake resulting from the typographical error committed in the preparation of the Deed of Sale with Partition dated August 24, 2009, and consequently, in the titling of said parcels of land with the Registry of Deeds for Quezon City. DaHcAS In reply, please be informed that since the exchange transaction is without any monetary consideration and considering further that the execution of the Deed of Exchange is merely for the purpose of correcting the mistake above-described, the exchange of realties by Gian Paolo V. Dela Concepcion and Luis Antonino V. Dela Concepcion is not subject to the capital gains tax imposed under Section 24 (D) (1) of the Tax Code of 1997. Moreover, the said swapping of real properties is not likewise subject to the documentary stamp tax imposed under Section 196 of the Tax Code of 1997. However, the notarial acknowledgement to the said Deed of Exchange is subject to the documentary stamp tax of P15.00 only pursuant to Section 188 of the said Code. (DA-060-2004 dated Feb. 10, 2004) 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