Non-deductibility of the Expenses Incurred in the Repairs and/or Remodelling of the Basement Floor of Leased Buildings

March 25, 1959 BIR RULING NO. 162-59 The Provincial Treasurer Iba, Zambales S i r : In reply to your letter dated November 11, 1958, I have the honor to inform you that no deduction from gross income may be made for any amount paid out for new buildings or for permanent improvements, or betterments made to increase the value of any property or estate or any amount expended in restoring property or in making good the exhaustion thereof for which an allowance is or has been made pursuant to Section 31 (a) (2) & (3) of the Tax Code, as amplified by Section 120 of Revenue Regulations No. 2, otherwise known as the Income Tax Regulations. Accordingly, expenses incurred in the repairs and/or remodelling of the basement floor of leased buildings are not deductible from gross income because such expenses are not ordinary but are considered incurred for betterments to increase the value of the property. LLjur Very truly yours, (SGD.) JOSE ARAAS Commissioner of Internal Revenue