BIR Ruling No. 460-2020

BUREAU OF INTERNAL REVENUE REPUBLICOFTHE PHILIPPINES DEPARTMENT OF FINANCE Quezon City

RA No. 7279 BIR Ruling No.034-15 CM1-0468-2020 AUG 1 8 2020

SAMAHANG MARALITA CATMON Sitio 6, Catmon, Malabon City 1470 HOMEOWNERS ASSOCIATION,INC.

Attention:DENNIS B.MASTELERO SMC HOA President

Gentlemen:

and Housing Act of 1992". CATMON HOMEOWNERS ASSOCIATION, INC., in favor of its qualified member- beneficiary pursuant to Republic Act No. 7279 otherwise known as the "Urban Development gains tax (CGT), relative to the transfer of title of land from SAMAHANG MARALITA This refers to your letter dated June 14, 2019, requesting exemption from capital

organization duly registered with the Housing and Land Regulatory Board (HLURB) under Originator; that said project was taken-out/paid onNovernber 23, 2004 in the amount of registered owner of the parcel of land located at Lot 12, Blk. 9, Sitio 6, Gov. Pascual Ave. issued by the Registry of Deeds of Malabon"City; that it is a non-stock, non-profit Certificate of Registration No. under the Community Mortgage Program (CMP) with Foundation For Alternatives, Inc., as Catmon Malabon City and covered by Transfer Certificate of Title (TCT) No. ASSOCIATION,INC.,withTaxpayer's. Identification No. It is represented that SAMAHANG MARALITA CATMON HOMEOWNERS ; that the aforesaid lot was acquired through a loan is the

HOMEOWNERS ASSOCIATION, INC. in favor of its member-beneficiary, to wit: involving One Hundred Fifty Four (154) beneficiafies; that on July 22, 2019, a Deed of Absolute Sale was executed by SAMAHANG MARALITACATMON

MARLITA G. SAMSON Member-Beneficiary TCT No. Lot Area (sqm. Lot 12,Blk.9,Sitio 6,Gov.Pascual Ave., Catmon, Malabon City Address

and that Marlita G. Samson, a member-beneficiary, is now in the process of transferring the purchased property to her name.

as amended, considering that the said transfer of property is made only as a formality to subject to either the CGT imposed under Section 27 (D) (5) of the Tax Code of 1997, as amended, or the creditable withholding tax imposed under Revenue Regulations No. 2-98. member-beneficiary who has made full payment of her purchased subdivided lot is not CATMON HOMEOWNERS ASSOCIATION,|INC. in favor of the above-named In reply, please be informed that the transfer by SAMAHANG MARALITA O

SAMAHANG MARALITA CATMON HOMEOWNERS ASSOCIATICIN,INC Page 2 of 2 CMP-0450-20Z0 AUG 1 8 2020

finally effect the transfer of the said property to its member-beneficiary, Marlita G. Samson. who actually bought the same from the former owner through the Association. In other beneficiary who actually owns the aforedescribed lot. words, the association is merely transferring the ownership of the property to its member-

Section 98 of the Tax Code of 1997, as amended, since there is no donative intent on the part of the Association to donate the said property to said member-beneficiary, considering that it could not donate property the ownership of which already belongs to the member beneficiary. (BIR Ruling No. 034-2015 dated February 5, 2015) Furthermore, the said transfer is not subject to the donor's tax imposed under

realty sold shall be granted, assigned, transferred, of otherwise conveyed to a purchaser or purchasers or to any other person or persons designated by such purchaser or purchasers, documents subject to the documentary stamp tax (D$T) imposed therein are those where the thereby excluding from its purview the instant case considering that the supposed purchaser is actually the owner thereof. It is noted that under Section 196 of the Tax Code of 1997, as amended, the deeds or

documentary stamp tax of P30.00' pursuant to Section 188 of the Tax Code of 1997. (BIR Ruling No. 034-2015 dated February 5, 2015). beneficiary is not subject to DST under Section 196of the Tax Code of 1997, as amended. However. the notarial acknowledgment to the deed of conveyance is subject to the Accordingly, the transfer of title of the subject lot in favor of the above-named

after it is established upon proper verification by the Revenue District Officer (RDO) concerned that, considering the rules on valuation on real property, the actual selling price per sale transaction in this case does not exceed P450,000.00 for house and lot and P180,000.00 for lot only for each qualified beneficiaries. (BIR Ruling No. 034-2015 dated February 5, 2015) only be issued after the submission of the requirements provided under RMO 15-2003 and It is, however, understood that the Certificate Authorizing Registration (CAR) shall

However, if upon investigation, it iwill be disclosed 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 represented.

Very truly yours.

aaa

Commissioner of Internal Revenue CAESAR R.DULAY

K-1-JAC 036398

1The new DST rate is used since the transaction took place afer the effectivity of RA 10963 or TRAIN Law.