BIR Ruling No. 002-2024

REPUBLIC OF THE PHILIPPINES

BUREAU OF INTERNAL REVENUE DEPARTMENT OF FINANCE

National Office Building Quezon City

Republic Act No.4726 BIR Ruling No. 474-19 OT- 0 0 2 - 2 0 2 4

JAN 1 8 2024

1634 Taguig City ALVEO LAND CORP. Alveo Corporate Center 728 28th St., Bonifacio Global City

Attention: Attorney-in-Fact ANTONIO S. SANCHEZ HII

MICHELLE A. ALIGGAYU Attorney-in-Fact

Gentlemen:

Internal Revenue Code ("Tax Code") of 1997, as amended. that the transfer dr conveyance of common areas, including the land and facilities and utilities to the Condomihium Corporation, without consideration, is not subject to income tax, creditable withholding tax ("CWT"), value-added tax ("VAT"), documentary stamp tax ("DST"), but subject to DST on notarial acknowledgement under Section 188 of the Nation:l This refers to your request on behalf of ALVEO LAND CORP. ("ALC")' for a ruling

under the laws of the Republic of the Philippines. Documents submitted disclose that ALC is a corporation duly organized and existing

located in Felix Huerta St., Sta. Cruz, Manila, more specifically described in Transfer and existing under and by virtue of the laws of the Republic of the Philippines. It is the duly. registered owner of the parcel of land with an area of approximately 9,273 square meters Certificate of Title ("TCT") No. Likewise,MANILA JOCKEY CLUB, INC. ("MJCl") is a corporation duly organized of Registry of Deeds of the City of Manila.

(the "Condominium Corporation") is a non-stock, not-profit corporation duly registered with the Securities and Exchange Commission ("SEC") and organized pursuant to the provisions of Master Deed with Declaration of Restrictions for the purpose of holding title of the land as well as the common area of the project. On the otKer hand,CELADON PARK MANILA CONDOMINIUM CORPORATION

(the "Project"); ahd ALC executed a Master Deed with Declaration of Restrictions including its amendments, and further caused the same to be 'annotated on the aforesaid TCT No. executed betweeri ALC and MJCI, ALC has developed and constructed Celadon Park Manila In accordance with the Joint Development Agreement dated February 16, 2005.

1 Formerly: Community innovations, Inc.

OT-0022024

JAN 1 8 2024

respective rights, interests, and title over the common areas, which include the land with a total the Deed of Conveyance, whereby ALC and MJCI assigns, transfers, and conveys all their area of 9,273 square meterswherein the Project is developed and constituted to the Condotninium Corporation for the use of the owners and residents of all the condominium unit of the Project. Hence, this request. Thereafter, on May 6, 2019, ALC, MJCI, and the Condominium Corporation executed

that whenever the common areas in a condominium project are held by a condominium corporation, such corporation shall constitute the management body of the project. The corporate purposes of such a corporation shall be limited to the holding of the common areas, of the project, and to such other purposes as may be necessary, incidental or convenient to the accomplishment of said purposes. either in ownership or any other interest in real property recognized by law, to the management In reply, please be informed that Section 10 of Republic Act ("RA").No. 4726 provides

the common benefit of the unit owners. therefore, no capital gains tax or CWT is payable and collectible. The purpose of the conveyance to the Condominium Corporation is for the management of the project for with the sale made to Condominium Corporation, no taxable income will be generated and Since the Deed of Conveyance is made without consideration and is not in connection

to the DST of P30.00 under Section 188 of the Tax Code of 1997, as amended. consideration are not taxable." However, the notarial acknowledgment to such deed is subject that "conveyances of realty not in connection with a sale, to trustees or other persons without 185 of the Revised Documentary Stamp Tax Regulations (Regulation No. 26) which provides Moreover, it is also exempt from the imposition ofDST imposed under Section

be considered as a transaction subject to VAT pursuant to Section 105 of the Tax Code of 1997, party to another where the beneficial ownership of which is retained by the original party is not Corporation composed of the condominium unit owners, the real estate developer receives no additional payment. The conveyance is without any monetary consideration and is not in connection with any sale in favor of the Condominium Corporation. As such, the same cannot embodied in the Deed of Conveyance is also not subject to VAT under Title IV of the Tax Code of 1997, as amended. It must also be noted that the transfer of the real property from one taxable. When the title of the land and the common areas are transferred to the Condominium as amended. Finally, the transfer of land and the common areas of the Condominium Corporation as

upon investigation, it will be ascertained that the facts are different, then this ruling shall be considered null and void. This ruling is being issued on the basis of the foregoing facts as presented. However, if

Very truly yours.

UMAGUI.JR

K mmissioner of Internal Revenue

PAGE 2OF 2