Exemption from Donor's Tax

December 4, 1990 BIR RULING NO. 227-90 94 (a) (3) 109-89 227-90 S i r : This refers to your letter dated May 8, 1990 requesting in behalf of your clients, the Community of Benedictine Sisters and the St. Scholastica's College, Inc., exemption under Section 94 (a)(3) of the Tax Code, of the conditional donation of two (2) parcels of land situated at Barangay Iruhin, Tagaytay City, covered by TCT Nos. T-14326 and T-14327 made by the Community of Benedictine sisters in favor of the St. Scholastica's College, Inc. by virtue of a Deed of Donation executed on April 16, 1990. aisadc It appears from the documents submitted that the Donee, St. Scholastica's College, Inc., is a non-stock, non-profit educational corporation, paying no dividends, governed by trustees who receive no compensation and irrevocably devoting all its income, whether student's fees, or gifts, donations, subsidies or other forms of philanthropy, solely to the accomplishment and promotion of the purposes, aims and objectives for which it was organized, and no part of its income inure to the benefit of any person whensoever. In reply, please be informed that pursuant to Section 94 (a)(3) of the Tax Code, as amended, gifts in favor of an educational corporation or institution, among others, are exempt from the donor's tax provided that not more than thirty per centum (30%) of gifts shall be used by such donee for administration purposes. Such being the case, this Office, is therefore of the opinion as it hereby holds that the aforementioned donation of 2 parcels of land covered by TCT Nos. T-14326 and T-14327 by your client, the Community of Benedictine Sisters in favor of the St. Scholastica's College, Inc. on April 16, 1990 is exempt from the payment of the donor's tax. Very truly yours, (SGD.) VICTOR A. DEOFERIO, JR. Deputy Commissioner