Exemption of Gifts to Educational and/or Charitable, Religious, Cultural or Social Welfare Corporation or Institution from Donor's Tax

April 7, 1988 BIR RULING NO. 130-88 29 (h) (1) (94) 103-88 130-88 Gentlemen : This refers to your letter dated March 3, 1988 requesting confirmation of your opinion that donation of real property by Maison Du Dela Salle College in favor of Dela Salle-Lipa, Inc. is not subject to donor's tax. It is represented that the donee is a non-profit and non-stock educational institution paying no dividends to its stockholders and devoting all its income to the goal of providing Christian education to the Filipino youth; and that it is the recipient of donations of real property located in Lipa City and covered by TCT Nos. T-32222 and T-32223. In reply, please be informed that pursuant to Section 94(3) of the Tax Code, as amended, gifts in favor of an educational and/or charitable, religious, cultural or social welfare corporation or institution are exempt from the donor's tax provided that not more than thirty per centum of said gifts shall be used by such donee for administration purposes. Moreover, Section 29(h)(A) of the Tax Code, as amended, provides that gifts actually paid or made within the taxable year to domestic corporations for educational purposes, among others, are deductible for income tax purposes only to an amount not in excess of 6% in the case of an individual donor and 3% in the case of a corporate donor of the donor's taxable income derived from business as computed without the benefit of said donation. In view thereof, this Office is of the opinion as it hereby holds that the aforementioned donations are exempt from the payment of the donor's tax. cdta Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner