Tax Liability of a Sublessor of Realty

January 7, 1959 BIR RULING NO. 035-59 1st Indorsement Returned to the Regional Director, Manila, the herein papers bearing on the case of Mr. Tiu Ka Bin. LibLex The papers of this case disclose that Mr. Tiu Ka Bin is a sublessor of a building located at 1148-56 Narra St., Manila. As such sublessor he received as rentals the sum of P6,285.00 for the year 1955. Being a sublessor of realty, Mr. Tiu Ka Bin is a real estate dealer subject to the fixed tax prescribed in Section 182(s) of the Tax Code. Such being the case, Mr. Tiu Ka Bin should, therefore, keep and use the books of accounts required by Section 334 of the Tax Code. Since his gross quarterly receipts as a sublessor do not exceed P5,000 he may, therefore, use the simplified set of bookkeeping records. The statement of net worth and operations is a part of the simplified set of bookkeeping records. (Section 1, Revenue Regulations No. V-13). Consequently, Mr. Tiu Ka Bin should file the statement of net worth and operations with his income tax return. The allegation that Mr. Tiu Ka Bin does not have any capital investment in the building of which he is the sublessor, even if true, is immaterial and will not exempt him from the requirement of filing the statement of net worth and operations because the regulations do not consider the said allegation a ground upon which a taxpayer may be freed from the said requirement. prcd (SGD.) MELECIO R. DOMINGO Acting Commissioner of Internal Revenue