Jul 092014
IN THE recently issued Revenue Memorandum Circular (RMC) No. 46-2014, the Bureau of Internal Revenue (BIR) clarified that a financial lease is essentially a mode of extending credit, and is therefore subject to documentary stamp tax (DST) as a loan and not as a lease.
Generally, a lease is an agreement whereby a person (lessor) binds himself to give a property to another — (lessee) for use and enjoyment for a certain period of time in return for rental payments.