BIR Ruling No. 046-80

October 27, 1980 BIR RULING NO. 046-80 031-a-1 000-00 46-80 Kalayaan Construction Planning and Management Corporation 305 L & S Building 1515 Roxas Boulevard, Manila Attention : Mr . Bernardo O . Armea Gentlemen: This refers to your letter dated June 21, 1980, and the enclosed circular of the Valley Golf Club, Inc. stating that it is undertaking the reconstruction of the Men's Locker Room of its Clubhouse which was destroyed by fire; and assessing every shareholder/member thereof the amount of P3,500 each to raise the necessary fund for the said project. You are seeking opinion on whether this assessment would be considered as a deductible expense on the part of the shareholder/member, or as capital outlay in the nature of an additional equity to the Club, and therefore not deductible from the gross income of the shareholder/member. In reply, please be informed that the amount of P3,500 that every shareholder/member is paying to the Valley Golf Club, Inc. to help finance the reconstruction of the Men's Locker Room of its Clubhouse is a capital expenditure of said shareholder/member and is therefore not deductible for income tax purposes. aisadc Very truly yours, ROMULO M. VILLA Acting Commissioner