BIR Ruling No. 321-2018

REPUBLIC OF THE PHILIPPINES

DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE

Quezon City.

RA No. 7279 BIR Ruling No.034-15 321-2018 3-6-2018

MOHON TISA RESIDENTS ASSOCIATION HOA, INC Motra Mohon I, Brgy. Tisa, Cebi: City, Cebu 6000 -

Attention : FELIX V.GAHOL

Gentlemen: *

This refers to your letter jiated July 28, 2016, requesting exemption from capital gains

tax (CGT), relative to the transfer of title of land from MOHON TISA RESIDENTS ASSOCIATION HOA, INC. ("MOTRA" for brevity), in favor of its qualified member. beneficiary pursuant to Repubiic Act 7279 'otherwise known as the "Urban Development and Housing Act of i 992"

It is represented that MOTRa, with Taxpayer's Identification No. is the registered owner.of the parcel of Jand iocated at Brgy. Tisa, Cebu City and covered by Transfer Certificate of Tiile (TCT) No. issued by the Registry of Deeds of Cebu City; that it is a non-stoci, non-profit organization duly registered with the Housing and Land Regulatory Board (HLURB) with Registration No. that the aforesaid iot was acguired through a loan uinder the Community .Mortgage Program (CMP) of the Social Housing Finance Corporation (SHFC); that said project was taken-out/paid on .june 28, 1993

beneficiaries; that on June: 10, 2015. a Deed of Absotute Sale was executed by MOTRA in in the amount of pesos (F ', involving

favor of its member-beneficiary. to wit:

Member- BeneficiariesTCT No. Fe{ix V.Gahol Description Lot Area Brgy. Tisa, Cebu City Address

and that Felix V. Gahol, a member-beneficiary. is now in the process of transferring the purchased property to his n&me.

In reply: piease be informed_that the transfer by MOTRA in favor of the above.-- named member-beneficiary who has made full payment of his purchased subdivided lot is not subject to either the C:GT imposed under Section 27 (D) (5) of the Tax Code of 1997, as amended, or the creditabie withhotding tax imposed under Revenue Regulations No. 2-98 as amended, considering that the said transfer of property is made without any consideration and effected only as a formaiity io finaily effect the transfer of the said property to its

of th-: proer: :: : n .ber-beneficiary who actually owns the aforedescribed lot. member-eneFii-- F!:.: V. Gahol, who actually bought the same from the former owner thro: th: : ::.. *:: other words, the association is merely trarisferring the ownership

to dor: .- .- r:."- to said member-beneficiary, considering that it could not donate propsr .: * ..* which already belongs to the member-beneticiary himself. (BIR Rin : :.. (::-::: : t:: February 5, 2015) 99 o" tr:-. T a:: -: :: : :-7, since there is no donative intent on the part of the Association -rther.:. 1--:id transfer is not subject to the donor's tax imposed under Section

exei:: fr: i: w the instant case considering that the supposed purchaser is actualiv t -r t: * Besides, no consideration is involved in said transaction upon subjset t. ti : . stamp tax (DST) imposed therein are those where the realty sold or to ay o*:* :r. :* persons designated by such purchaser or purchasers, thereby shall bs grt*:. ::. transferred, or otherwise conveyed to a purchaser or purchasers Whieh ers tet te Ir 1: :c:**: 1:- :.ir Section 196 of the Tax Code of 1997, the deeds or documents s../.. .1d be based.

of`P13.00 pu-euar: u: S%:-1on 188 of the Tax Code of 1997. (BIR Ruling No. 034-2015 dated beneflein is m i s::- t: DST underSection 196 of the Tax Code of {997. However, the r:ctariai a!ier.- to the deed of conveyance is subject to the documentary stamp tax Februry 5. 2015. "cordir:: :. tansfer of titie of the subject lot in favor of the above-named

conesrnted :ha:. :si:ie.ng the rules on valuation on real property, the actual selling price afisr i is asteisiss wn proper verification by the Revenue District Officer (RDO) P130.00.0: for io% on: tor each qualified beneficiaries. (BIR Ruling No. 034-2015 dated oniy: b: isus' :e: t:: ::'omission of the requirements provided umder RM0) 15-2003 and per sns*a:i: ir ihis case does not exceed P450,000.00 for house and lot and Fe0rA52E it i.. n***. rstood that the Certificate Authorizing Registration (CAR) shall

However. if upon ivastgation, it will be disclosed that the facts are different, then this ruline shall ne ceaaaersd null and void. Tr!:: r: i: tig issued on the basis of the foregoing facts as represented

Very truly yours,

18ramw

Commissioner of internal Revenue CAESAR R. DULAY 014066

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