BIR Ruling No. 609-2017

REPUBLIC O: THE PHILIPPINES

DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE Quezon City

Certificate of Tax Exemption No: 609-20 17

CERTIFICATE OF TAX EXEMPTION

TO ALL WHOM IT MAY CONCERN:

income received urrectly in connection with its low-cost mass housing projects, Sun the Board of Investments (BOl) under Registration No. Number Residences Tower 1 consisting of 2,057 units and Sun Residences Tower 2 consisting of 1,947 units, both located at Espania Bivd.. cor. Mayon St.. Quezon City. duly registered with and Registration No. This certifies that SM DEVELOPMENT CORPORATION. with Tax Identification is exempt from income tax and creditable withholding tax on its dated May 12, 2011. respecuvery. dated November !9, 2010

Residences Tower 1 and October 2012 for Sun Residences Tower 2, or the actual start of commercial operations/selling, whichever is earlier, but in no case earlier than the date of registrations of the projects with the BOl, pursuant to Executive Order No. 226. otherwise known as the "Omnibus Investments Code of 1987" and Section 2.57.5 (B) (2) of Revenue Regulations (RR) No. 2-98, as amended. The exemption is for a period of 3 years beginning from December 2010 for Sun

and below, is VAT-exempt tinder Section (09(1)(P) of the National Internal Revenue Code of 1997, as amended. Moreover. the sale by the Company of residential dwellings valued at P3.199.200.00

appropriate taxes under thc National internal Revenue Code of 1997. as amended. Residences Tower l and 1.947 residential units in Sun Residences Tower 2. as well as the 189 commercial units and 649 parking slots in both towers shall be subject to the payment of However. the sale of residential units in excess of 2.057 residential units in Sun

applicable BiR ruies and regulations and the Terms and Conditions stated at the back hereof. The Company is liable, however, for al' other applicable taxes not discussed above. The grant of tax cxcmption herein is subject to the compliance with the provisions of

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

Issued this day of. 0EC 1 4 2017

8MAy

+K-I-LMAT Comnissioner of Internal Revenue CAESAR R. DULAY +.. 011743

(Sun Residences Tower 1 & Tower 2) SM DEYELOPMENT CORPORATION CTE NO. Date issued_12m 509-3017 14-2012

OF THE CERTIFICATE OF TAX EXEMPTION TERMS AND CONDITIONS

The exemption from income and creditable withholding taxes covers only income directly of 2,057 units and Sun Residences Tower 2 consisting of 1,947 units. both iocated at Espania Blvd., cor Mayon St., Quezon City. Such exemption shal! not cover revenues from units with attributabie to the revenues generated from the projccts. Sun Residences Tower I consisting selling price exceeding

2 The Company is obligated to construct and sell 2,057 units for Sun Residences Tower 1 and

1,947 units for Sun Residences Tower 2, based on the fol!owing schedules/sales revenues:

Sun Residences Tower 1: Sun Residences Tower 2:

Total Year 2 (No. of Units) Volume 2,057 1.029 514 4 (Php'000) Value Tota! Yea (No. of Units) Volume 1 584 9 4 3 89 (Php'000) Value

3 In the computation of thc project's ITH, interest income from in-house financing shail not be considered as part of the revenues generated trom th: registered hot:sing project.

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. 10708'. the Company is required to file its tax 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. deductior:s. cred-ts or exclusions from the tax base. as may be provided under E.O. 226. within the periocs prescribed under RA No. 10708's Implenenting Rules and Regulations and Joint Menorandum Circular No. 1-2016 dated 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 September 1.2016.

6. The Company shall be constituted as a withholdirg agent for the government if it acts as employer and any of its employees received compensaticn income subiect to coinpensation Internal Revenue Code of 1997. as amended, and implemented by Rever:ue Regulations (RR) withhotding 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 No. 2-98. as airiended.

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 Stafenrent 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 examination by revenue enforcement officers pf this Burealt for she purpose of ascertaining whether 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 I997, as amended.

An Act Enhaneing Transparency in the Management and Accorinting of Tax Incentives Administered by Investment Promotion Agencies.

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