BIR Ruling No. 564-2020

REPUBLIC OF THE PHILIPPINES

BUREAU OF INTERNAL REVENUE DEPARTMENT OF FINANCE

Quezon City DT

Certificate of Tax Exemption No:

BOI-LEH-0564-202

CERTIFICATE OF TAX EXEMPTION

TO ALL WHOM IT MAY CONCERN:

housing project (vertical), Spring Residences Phase 2 (Tower 3) -- West Service Road, Identification Number (TIN) withholding tax on its income received directly in connection with its economic and low-cost Barangay Sun Valley, Paranaque City, consisting of 412 residential units used solely for family home or dweiling purposes, located at West Service Road, Barangay Sun Valley, Paranaque City, a project duly registered with the Board of Investments (BOI) under December 29, 2017 to December28,'2020, pursuant to Executive'Order (EO) No. 226, Revenue Regulations (RR) No. 2-98, as amended, provided that the selling price of said otherwise known as the Omnibus Investments Code of 1987 and Section 2.57.5 (B) (2) of residential units does not exceed P3,000,000.00' per residential unit. Registration No. This certifies that SM DEVELOPMENT CORPORATION, with Taxpayers dated May 05, 2017, for a period of three (3) years beginning from is exempt from income tax and creditable

below, or house and lot and other residential dwellings valued at P3,199,200.00 and below, is exemption from VAT shall only apply to sale of house and lot and other residential dwellings exempt from value-added tax (VAT) pursuant to Section 109 (1) (P) of the National Internal Revenue Code of 1997, as amended. Provided, however, that beginning January 01, 2021, the with selling price of not more than P2,000,000.00. Moreover, the sale by the Company of residential lot valued at P1,919,500.00 and

units), as well as the 75 parking slots, including those units used for commercial purposes such as leasing, retail stores, offices, etc., shall be subject to the payment of appropriate taxes under the National Internal Revenue Code of 1997, as amended. with the BOI (per License to Sell No. However, the sale of residential units in excess of the . dated June 26, 2018, the excess is 22 residential residential units registered

applicable BIR rules and regulations and the Terms and Conditions stated at the back hereof. The Company is liable, however, for all other applicable taxes not discussed above. The grant of tax exemption herein is subject to the compliance with the provisions of

that the facts are different, then this Certificate shall be considered null and void. documents as represented and submitted. However, if upon investigation, the BIR ascertains This Certificate of Tax Exemption is being issued on the basis of the facts and

Issued this day of OCT 0 1 2020

1eesam

CAESAR R. DULAY

K-1-LMAT Commissioner of Internal Revenue 036869

Sale of lot only, regardless of the price, shall be subject to VAT starting January 01, 2021 pursuant to Republic Act (RA) No. 10963. Per Certification dated June 25, 2020 issued by the BOI.

(Spring Residences Phase 2 (Tower 3) SM DEVELOPMENT CORPORATION Date issued: U2020 CTE No.: BOI-LEH- 3564-2020

OF THE CERTIFICATE OF TAX EXEMPTION TERMS AND CONDITIONS

1. The exemption from income and creditable withholding taxes covers only income directly attributable to the revenues generated from the project, Spring Residences Phase 2 (Tower 3) - used solely for family home or dwelling purposes, located at West Service Road, Barangay Sun exceeding P3,000,000.00. West Service Road, Barangay Sun Valley, Paranaque City, consisting of 412 residential units Valley, Paranaque City. Such exemption shall not cover revenues from units with selling price

The Company is obligated to construct and sell 412 residential units based on the following schedules/sales revenues:

Year Total 2 C (No. of Units) Volume 200 412 160 52 (in PhP000) Value

3. In the computation of the project's ITH, interest income from in-house financing shall not be considered as part of the revenues generated from the registered housing project.

4 The Company's entitlement to ITH for its BOI-registered housing project is subject to the

compliance with the provisions of the Specific Terms and Conditions of its BOI Registration.

5. Pursuant to Section 4 of Republic Act (RA) No. 107083, the Company is required to file its tax

returns and pay its tax liabilities, on or before the deadline as provided under the National Internal Revenue Code of 1997, as amended, using the electronic system for filing and payment of taxes of the BIR. It shall file with BOI a complete annual tax incentives report of its income-based tax incentives, VAT and duty exemptions, deductions, credits or exclusions from the tax base, as may be provided under E.O. 226, within the periods prescribed under RA No. 10708's Implementing Rules and Regulations and Joint Memorandum Circular No. 1-2016 dated September 1, 2016.

6. The Company shall be constituted as a withholding agent for the government if it acts as employer amended, and implemented by Revenue Regulations (RR) No. 2-98, as amended. and any of its employees received compensation income subject to compensation withholding tax, or if it makes payments to individuals or corporations subject to the withholding taxes as source as required under Chapter XIII and Section 57 of the National Internal Revenue Code of 1997, as

7.The Company is required to file on or before the 15th day of the fourth month following the close of its accounting period of a Profit and Loss Statement and Balance Sheet with the Annual Information Return under oath, stating its gross income and expenses incurred during the taxable year.

8.Finally, the Company's books of accounts and other pertinent records shall be subject to periodic it is complying with the conditions under which it has been granted tax exemption or tax incentives and its tax liability, if any, pursuant to Section 235 of the National Internal Revenue Code of 1997. examination by revenue enforcement officers of this Bureau for the purpose of ascertaining whether as amended.

An Act Enhancing Transparency in the Management and Accounting of Tax Incentives Administered by Investmen

Promotion A gencies.

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