Implementation and Use of the LRA's Philippine Land Registration and Information System (PHILARIS) for the Automated Verification of the BIR Electronic Certificate Authorizing Registration (eCAR)

November 13, 2013 BIR RULING NO. 415-13 Secs. 101 (A) (2); 196; BIR Ruling No. 094-10 Punong Barangay Edgar S. Bihag Barangay Cubacub, Mandaue City Sir : This is refers to your letter dated August 16, 2010, as indorsed by the Regional Director of Revenue Region No. 13, Cebu City on September 7, 2010, requesting for tax exemption on the donation made by Ms. Zenaida Hindang Bathan of a portion of her property to Barangay Cubacub, Mandaue City. Documents submitted show that Zenaida Bathan (TIN 143-236-427) is the registered owner of a parcel of land covered by Transfer Certificate of Title (TCT) No. 34200 located at Cubacub Rd. Interior, Purok 3, Cubacub, Mandaue City with an area of 996 sq.m. On the other hand, Barangay Cubacub (TIN 237-805-468) is a local government unit in the City of Mandaue, Cebu. On September 12, 2008, thru a Deed of Donation Inter Vivos, Zenaida Hindang Bathan had ceded, transferred and conveyed to Barangay Cubacub, Mandaue City a portion of the afore-described property consisting of 241 sq.m. bearing Lot No. 1519-C of the subdivision plan Psd-07-022094. The Office of the Barangay Captain of Barangay Cubacub, Mandaue City, by way of an unnumbered Resolution, Series of 2008, accepted the property donated to it by the donor and undertakes to use the property in accordance with the purpose for which it was donated, that of being a barangay road. EIcSTD In reply, please be informed that Section 101 (A) (2) of the Tax Code of 1997 provides that: "SEC. 101. Exemption of Certain Gifts . The following gifts or donations shall be exempt from the tax provided for in this Chapter: (A) In the Case of Gifts Made by a Resident. (1) ... (2) Gifts made to or for the use of the National Government or any entity created by any of its agencies which is not conducted for profit, or to any political subdivision of the said Government; and xxx xxx xxx" Inasmuch as the donee is a political subdivision of the National Government and the real property donated by Zenaida Hindang Bathan shall be utilized by the donee as a barangay road, the aforesaid donation is exempt from the payment of donor's tax pursuant to Section 101 (A) (2) of the Tax Code of 1997, as amended. (BIR Ruling No. 094-10 dated October 6, 2010) Moreover, the Deed of Donation is not subject to the documentary stamp tax. However, the notarial acknowledgment on the deed is subject to the documentary stamp tax of P15.00 imposed under Section 188 of the Tax Code of 1997, as amended. Lastly, the Register of Deeds shall annotate the Deed of Donation Inter Vivos at the back of the TCT because failure to comply with particular terms therein shall be a ground for the revocation of the donation pursuant to Article 764 of the New Civil Code. This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation it will be ascertained that the facts are different, then this ruling shall be considered as null and void. DHSEcI Very truly yours, (SGD.) KIM S. JACINTO-HENARES Commissioner of Internal Revenue