REVENUE REGULATIONS NO. 26-2020 issued on October 6, 2020 implements
Section 4 (zzz) of Republic Act (RA) No. 11494 (Bayanihan to Recover as One Act)
relative to donations of identified equipment for use in public schools.
The Regulations cover all donations of personal computers, laptops, tablets, or
similar equipment (i.e. mobile phone, printer) for use in teaching and learning in public
schools starting from the effectivity of the said Act on September 15, 2020 up to
December 19, 2020.
Donor/s of said equipment shall be entitled to the following tax incentives:
a. Deduction from the gross income of the amount of contribution/donation
subject to limitations, conditions and rules set forth in Section 34 (H) of the
Tax Code and to the following conditions:
i. That the Deed of Donation shall indicate in detail the items donated,
its quantity/number and the amount/value of the donation;
ii. That the deduction shall be availed of in the taxable year in which the
expenses have been paid or incurred;
iii. That the taxpayer can substantiate the deduction with sufficient
evidence, such as sales invoice/s, delivery receipt and other
adequate records –
• The amount of expenses being claimed as deduction;
• Proof or acknowledgement of receipt of the contributed/donated
property by the recipient public school.
b. Exemption from the payment of Donor’s Tax pursuant to Sections 101 (A)
(2) and (B) (2) of the Tax Code.
c. In case of foreign donation, the importation of personal computers, laptops,
tablets, or similar equipment by the Department of Education (DEPED), or
Commission on Higher Education (CHED), or TESDA, shall be EXEMPT
from Value-Added Tax (VAT); provided, that if the importer/consignee is
other than the abovementioned agencies, in order for the imported articles
to be exempt from VAT, the importer should present a Deed of Donation
duly accepted by the abovementioned agencies.
The importation hereof shall not be subject to the issuance of Authority
to Release Imported Goods (ATRIG) under Revenue Memorandum Order
(RMO) No. 35-2002, as amended, and the said goods may be released by
the Bureau of Customs (BOC) without the need of ATRIG. The BIR may,
however, conduct post investigation audit on the importations released by
the BOC without ATRIG pursuant to the Regulation.
d. In the case of local donation where the personal computers, laptops,
tablets, or similar equipment are originally intended for sale or for use in the
course of business by the donor, the same shall not be treated as
transaction deemed sale subject to VAT under Section 106 (B) (l) of the Tax
Code. Furthermore, any input tax VAT attributable to the purchase of
donated personal computers, laptops, tablets, or similar equipment not
previously claimed as input tax shall be creditable against any output tax.
The above rules shall also apply to donations by ECOZONE locators
to the abovementioned agencies.
For purposes of availment of the tax incentives provided under the
Regulations, no prior determination or ruling issued by the BIR shall be
required.
The amount of donation shall be based on the actual acquisition cost of
personal computers, laptops, tablets, or similar equipment donated. If the personal
computers, laptops, tablets, or similar equipment donated had already been used, its
depreciated value shall be taken into consideration.