RMO No. 18-2009: Dispenses with the requirement of securing a ruling from the BIR as a requisite for the issuance of Certificate Authorizing Registration (CAR)/Tax Clearance (TCL) on the conveyance of land and common areas by the real estate developer to the Condominium Corporation and prescribes the policies and guidelines in the issuance of CAR/TCL in respect thereto

Key points

1. No prior ruling required. The taxpayer does not have to secure a BIR ruling first, but may still do so at his option to confirm the tax-exempt status of the transfer.
2. Condition for the RDO to proceed. Once the required documents are in, the RDO may issue the CAR/TCL if the facts are analogous to those in the previously promulgated BIR rulings specified in the Order.
3. Documents the RDO requires. These include a signed request letter with reasons and facts, the notarized Master Deed of Conveyance of Land and Common Areas with Declaration of Restrictions and any amendment, the TCT, the Tax Declarations of the land and common areas, and the SEC Registration, Articles of Incorporation and By-Laws of the Condominium Corporation. Copies must be certified true copies.
4. Tax treatment of the transfer. No creditable withholding tax is payable. The Deed of Conveyance is exempt from DST under Sec. 196 of the Tax Code, and the transfer is not subject to VAT under Title IV.
5. DST on notarial acknowledgment. The notarial acknowledgment on the Deed is subject to DST of P15.00 under Section 188 of the Tax Code, as amended.

Who is affected

• Real estate developers
• Condominium Corporations
• Revenue District Officers

Deadlines and effectivity

• Issued June 3, 2009