Donations to Research Group Exempt from Donor's Tax

December 22, 1993 BIR RULING NO. 503-93 DONATIONS TO RESEARCH GROUP EXEMPT FROM DONOR'S TAX 94 (a) (3) 76-92 03-93 Pampamilyang Paaralang Agrikultura, Inc. 3rd Floor, Pieco Bldg., 2242 Pasong Tamo Makati, Metro Manila Attention: Mr . Felix Mabanta Sr . Vice-Chairman This refers to your letter dated October 14, 1993 requesting for exemption of the donations of several parcels of land made by individuals and corporate donors in favor of the Pampamilyang Paaralang Agrikultura, Inc. (PPAI). LLjur It is represented that the PPAI is a non-stock and non-profit education, research and social welfare corporation organized and existing under and by virtue of the laws of the Philippines, paying no dividends, governed by trustees who receive no compensation, and devoting all its income to the accomplishment and promotion of the purposes enumerated in its articles of incorporation; that Deeds of Donations of real properties were executed by the following corporate and individual donors in favor of PPAI, viz.: 1) Deed of Donation executed by Groja, Inc. represented by its Chairman and President, Gerardo B. Javellana in favor of PPAI covering a parcel of land situated in Barangay Libo-o, Municipality of Dingle, Province of Iloilo and covered by TCT No. T-93764 issued by the Registry of Deeds of the City of Iloilo; 2) Deed of Donation executed by Ayala Corporation represented by Messrs. Renato L. de la Fuente and Ramon F.R. Medina in favor of PPAI covering a parcel of land situated at Bo. Dagatan, Lipa City, Batangas, identified as Lot No. 12929-A-1 containing an area of 13,486 being a portion of that property identified as Lot No. 12929-A and covered by Transfer Certificate of Title No. 41108; 3) Deed of Donation executed by Mr. Emmanuel A. Ticzon in favor of PPAI covering a parcel of land situated in Barangay San Lorenzo, San Pablo City, containing an area of Twenty Thousand (20,000) square meters; 4) Deed of Donation executed by Mr. Ciriaco A. Reyes, Jr. in favor of PPAI covering a parcel of land situated in Porac, Pampanga covered by TCT No. 316441-R of the Registry of Deeds for the Province of Pampanga. In reply, please be informed that inasmuch as the donee is an educational, research and social welfare corporation, the aforementioned donation is exempt from the payment of donor's tax pursuant to Section 94(a)(3) of the Tax Code, as amended, subject to the condition that not more than 30% of said gift shall be used by the donee for administration purposes. Moreover, the aforementioned Deed of Donation is not subject to documentary stamp tax prescribed under Section 196 as amended but only to the documentary stamp tax of P3.00 imposed under Section 188 of the same Code. LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue