BIR Ruling No. 241-11

July 22, 2011 BIR RULING NO. 241-11 Section 101 (A) (3) of 1997 Tax Code; BIR Ruling No. 452-93; BIR Ruling No. 252-93; BIR Ruling No. DA-028-98 Church in Manila- Church Assembly Hall, Inc. 1007 Ongpin St. Sta. Cruz, Manila Attention: Mr. Joseph Tan President Gentlemen : This refers to your letter dated January 25, 2011 requesting for tax exemption enjoyed by religious organizations under Section 101 (A) (3) of the National Internal Revenue Code (NIRC) of 1997, as amended. Documents submitted show that Samuel Ng Chan (TIN 104-003-118-000) is the absolute and registered owner of a parcel of land with the building existing thereon located at Jose Abad Santos St.,Tondo, Manila and covered by Transfer Certificate of Title No. 157632 with an area of 202.30 sq.m. (Subject Property).On February 15, 2011, a Deed of Donation was executed by the afore-named donor in favor of Church in Manila-Church Assembly Hall, Inc. (TIN 000-848-152-000),a religious institution registered with the Securities and Exchange Commission (SEC) under SEC Registration Certificate No. 20890 dated June 18, 1962. In reply, please be informed that gifts in favor of educational and/or charitable, religious, cultural or social welfare corporation, institution, accredited nongovernment organization, trust or philanthropic organization or research institution or organization is exempt from the payment of the donor's tax pursuant to Section 101 (A) (3) of the NIRC of 1997, as amended, subject to the condition that not more than thirty percent (30%) of said gift shall be used by the donee for administration purposes. (BIR Ruling No. 452-93 dated November 19, 1993) TcIAHS Inasmuch as Church in Manila-Church Assembly Hall, Inc. is a religious corporation, any donation to it is exempt from the payment of donor's tax pursuant to the above provisions of the NIRC, as amended, subject to the condition that not more than 30% of said gifts shall be used by the donee for administration purposes. In case of donation of real property, the Register of Deeds shall annotate this condition at the back of the title because failure to comply with the said condition shall be a ground for the revocation of the donation pursuant to Article 764 of the New Civil Code. Section 185 of Regulations No. 26, otherwise known as the Revised Documentary Stamp Tax Regulations, implementing Title VII of the NIRC, provides that conveyances of realties not in connection with a sale, to trustees or other persons without consideration are not taxable. Accordingly, the deed of donation is likewise not subject to the documentary stamp tax prescribed under Section 196 of the NIRC, as amended, but only to the documentary stamp tax of P15.00 imposed under Section 188 of the same Code. (BIR Ruling Nos. 252-93 dated January 17, 1993 and DA-028-98 dated January 29, 1998) This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. Very truly yours, (SGD.) KIM S. JACINTO-HENARES Commissioner of Internal Revenue