Monday, March 18, 2013

Failed Tax Scheme?

(original web post 09/25/12) (BIR Media Release)

Does anyone have an update concerning this serious matter at SOMA?

http://www.mb.com.ph/articles/249408...g-housing-plan

BIR revokes ruling on housing plan

March 24, 2010, 5:49pm

The Bureau of Internal Revenue (BIR) revoked Wednesday an earlier ruling on the build-to-own (BTO), build-your-own (BYO) and other similar housing or condominium unit-owned schemes that resulted in the non-payment of taxes due to government.

BIR Commissioner Joel Tan-Torres said his agency nullified its previous ruling —
BIR Ruling No. DA-245-2005 on constructing or building housing or condominium units — after a thorough investigation conducted by regional district officer Gerry Dumayas and assistant regional district officer Christina Barroga of BIR-RDO in Taguig.

Dumayas and Barroga, in coordination with BIR-Makati RDO Alfredo Misajon ruled that Meridien East Realty and Development Corporation (Meridien) and Century Properties Inc., failed to pay the income taxes and value-added taxes in million of pesos.

Meridien and Century properties, in a joint venture transaction last April 2009, contested that they only manage the construction of the condominium project in Global City, Taguig, and the funds as payment of the individual investors/co-developers are pooled in the bank with the developer, as project manager, receiving only a project management fee.

Moreover, the assignment and delivery of the developed units to a joint owner, is claimed non-taxable being merely a transaction to effect the return of capital contribution. This resulted to the non-payment of income taxes and value-added tax by Meridien and CPI on the gross project amount.

However, upon RDO 44’s investigation of the facts presented. They found out that Meridien and CPI misrepresented said transactions, which nullified the said ruling. (Jun Ramirez)

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