QuestionsQuestions (BIR REVENUE MEMORANDUM CIRCULAR NO. 34-91)
It addresses the ante-dating of Deeds of Sale/Transfer of real properties to evade income tax or creditable withholding tax, or to reduce tax liabilities.
Ante-dating (1) before the effectivity of the capital gains tax law; (2) before the effectivity of the Finance Department Order establishing the zonal value; and (3) before the effectivity of regulations imposing the creditable withholding tax on sales or transfers of real property.
Public instruments transferring real properties presented to the appropriate revenue official beyond three (3) months from the date of notarization shall be considered ante-dated.
The tax liabilities of the parties are determined in accordance with the rules and regulations obtaining at the time the documents are presented to the BIR.
The three (3) months period is counted from the date of notarization; presentation beyond that timeframe triggers the presumption/consideration that the deed is ante-dated.
It was presented more than three (3) months from notarization (about 4+ months), so it shall be considered ante-dated under the circular.
For instruments considered ante-dated under the circular, tax computation follows the rules/regulations obtaining at the time the document is presented to the BIR, not the ante-dated date.
Their tax liabilities will be determined using the tax rules in effect at the time of presentation to the BIR, instead of the earlier rules they attempted to benefit from through ante-dating.
Because ante-dating may be done to avoid or reduce liabilities tied to these specific tax regimes or valuation rules that became effective at different times.
It refers to notarized instruments (such as Deeds of Sale or Transfer) that constitute public documents transferring ownership or interests in real properties.
The circular enjoins strict compliance with its provisions by taxpayers and/or the concerned parties dealing with the presentation of the instruments to the BIR, as well as the relevant BIR officials in applying the rule.
To stop further losses of revenue due to malpractices involving ante-dating and to ensure correct determination of tax liabilities.
The circular explicitly mentions income tax and creditable withholding tax (as well as the capital gains tax law in relation to one type of ante-dating).
It undermines reliance on the earlier effectivity that the taxpayer attempted to invoke; instead, it uses the effectivity of the rules at the time of actual presentation to the BIR.