Assignor of Real Property Not Subject to Capital Gains Tax

March 6, 1984 BIR RULING NO. 050-84 34-h-000-00-050-84 S i r : This refers to your letter dated January 17, 1984 requesting exemption from payment of capital gains tax on the receipt of your share in the estate of the late Macaria P. Angeles who died intestate on January 8, 1981 consisting of a parcel of land with an area of 817 square meters, more or less, covered by Transfer Certificate of Title No. 288566 of the Register of Deeds of Quezon City. Documentary evidence submitted show that on July 30, 1982 a Deed of Assignment was executed whereby the assignor, granted the assignees, namely, Ignacio Palacio and Anacleta Palacio Villena who are the brother and sister of the decedent their lawful share in the estate of the late Macaria Angeles, wife of the Assignor; and that as certified to on May 18, 1981 by the Regional Director, Revenue Region No. 4-A, the estate tax due on the transmission of said estate had already been fully paid. In reply, please be informed that no capital gains tax accrued and became collectible on account of the aforementioned Deed of Assignment because in this case, no taxable sale or transfer of property took place between the assignor and the assignees. The assignor did not part with any property but merely gave to the assignee what rightfully belonged to them as their share in the decedent's estate, the corresponding estate tax on which had already been fully paid. In view thereof, this office is of the opinion as it hereby holds that the assignor of real property in this case is not subject to the capital gains tax imposed by Section 34(h) of the Tax Code as amended. Accordingly, the aforesaid Deed of Assignment may be registered with the Register of Deeds of Quezon City, without the necessity of payment of capital gains tax by the assignor. Very truly yours, (SGD.) RUBEN B. ANCHETA Acting Commissioner