Amparo Investment Corp.'s Application for Certification Authorizing Transfer of Title to Foreclosed Real Properties

January 31, 1986 BIR RULING NO. 009-86 34-h 000-00 009-86 Gentlemen : This refers to your letter dated August 8, 1985 requesting clarification concerning your application for certification authorizing transfer of title to real properties foreclosed by you through foreclosure sale. It is represented that Amparo Investment Corporation, a financing company acquired through foreclosure sale real property which was given as collateral by the borrower-mortgagor in securing a loan with the company; and that the mortgagor failed to redeem the property within the period of redemption provided by law. In reply, I have the honor to inform you that Revenue Memorandum Order No. 33-81 provides that banks shall within 30 days after the foreclosure sale, apply for the issuance of the certification required by Section 34(h) of the Tax Code as implemented by Revenue Regulations No. 8-79 as amended by Revenue Regulations No. 9-84 dated June 28, 1984 with the Revenue District Officer having jurisdiction over the place where the real property sold or disposed is located. This is in consonance with the said provision requiring the presentation of the said certification before registration of any document transferring real property is effected by the Register of Deeds. Moreover, pursuant to Revenue Memorandum Order No. 18-82 supplementing Revenue Memorandum Order No. 33-81 insurance and finance companies are included as among those juridical entities allowed to register foreclosure sales and the consolidation of title in their favor, without the immediate payment of the capital gains tax on the foreclosed real property. Accordingly, since you are a financing company, you are allowed to consolidate title to the foreclosed property, without the immediate payment of the capital gains tax. cdtech Upon receipt of the application containing the required information, the Revenue District Officer shall issue the certification authorizing transfer of title to the financing company in the form prescribed by Revenue Memorandum Order No. 33-81. Thereafter, the Revenue District Officer shall conduct the necessary investigation to ascertain the capital gains tax from the mortgagor-debtor. Very truly yours, (SGD.) RUBEN B. ANCHETA Acting Commissioner