Tax notes: Transfer of land to a condominium corporation

PURSUANT to Revenue Memorandum Order (RMO) 18-2009, the Bureau of Internal Revenue (BIR) has dispensed with the requirement to secure a ruling before any certificate authorizing registration (CAR) or Tax Clearance can be issued by the concerned revenue district office on the transfer of land and common areas from the real estate developer to the condominium corporation.

This will be applicable in cases where the facts and the circumstances surrounding the transfer of land and common areas to the condominium corporation are analogous to the facts and circumstances contained in the previously promulgated rulings of the BIR resolving the tax issues on the matter.

This notwithstanding, the concerned taxpayers may still secure a prior ruling from the BIR to confirm the tax-exempt status of the transfer.

RMO 18-2009 also specifies the tax consequence of the transfer of land and common areas to the condominium corporation.

Upon receipt of all the documentary requirements enumerated under RMO 18-2009, the concerned revenue district office shall issue the CAR or the Tax Clearance on the transfer of the land and common areas to the condominium corporation. (Source: Punongbayan & Araullo)