Exemption from the Payment of Donor's Tax

August 23, 1988 BIR RULING NO. 404-88 94 (3) 307-87 404-88 Gentlemen : This refers to your letter dated October 12, 1987 requesting in behalf of your client, Prior Provincial of the Augustinian Province of Santo Nio de Cebu-Philippines, Inc. exemption from the payment of donor's tax and documentary stamp tax on the donation made by Mesdames Simoneta Tay and Juliana S. Tay of their respective parcels of lands situated at Quezon City, covered by TCT No. 296515 and TCT No. 296516 in its favor by virtue of Deeds of Donation executed on August 6 and 12, 1987. It appears that the Prior Provincial of the Augustinian Province of Santo Nio de Cebu-Philippines, Inc. is a religious corporation organized and existing under the laws of the Philippines. In reply, please be informed that inasmuch as the donee is a religious corporation, the aforementioned donations are exempt from the payment of donor's tax pursuant to then Section 104(a)(3) [now Section 94(3)] of the Tax Code, subject to the condition that not more than 30% of said gifts shall be used by the donee for administration purposes. Moreover, the aforesaid Deeds of Donations are not subject to the documentary stamp tax prescribed by then Section 209 (now Section 196) of the Tax Code on deed of sale and conveyance of real property since the transfer is gratuitous and has no consideration (Sec. 161, Regulation No. 26). However, the acknowledgment issued by the notary public is subject to the documentary stamp tax of P3.00 imposed on certificates in accordance with then Section 201 (now Section 188) of the same Code. cdta Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner