BIR Ruling No. 390-2022

BUREAU OF INTERNAL REVENUE REPUBLIC OF THE PHILIPPINES DEPARTMENT OF FINANCE

Certificate of Tax Exemption No. S30 39 0" f

CERTIFICATE OF TAX EXEMPTION

issued to

MATER DIVINAE GRATIAE COLLEGE, INC. Picardo Airport, Dolores, Eastern Samar 6017 SEC Company Reg. No. TIN:

has proven by actual operation that its primary purpose is one of those enumerated under Section 30(H) of the National Internal Revenue Code of 1997, as amended. It is exempt from INCOME TAX only on the following revenues or receipts: This certifies that the above-named corporation is a non-stock, non-profit corporation and

1. Tuition and Miscellaneous Fees; and 2. Income derived from the operation of cafeterias/canteens, dormitories and bookstores located within its premises, owned and operated MATER DIVINAE GRATIAE COLLEGE, INC., to be actually, directly and exclusively used for educational purposes.

nothing follows

hereof. It is liable, however, to all other taxes not enumerated above. subject to the provisions of applicabie BIR rules and regulations and the tax exemptions, liabilities and responsibitities stated in the Terms and Conditions hereto attached and made an integral part

income tax exemption. violation of any provisions of applicable rules and regulations of the BIR, or the terms and conditions herein set forth. It shall likewise be revoked if there are material changes in the character, purpose or method of operation of the corporation which are inconsistent with the basis for its This certification shall be valid from the date of issuance until revoked by this Office for

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

Issued this day of SEP 1 3 2022

K- Commissioner of Internal Revenue LILIA CATRIS GUILLERMO hl e.Gnl 001345

MATER DIVINAE GRATIAE Page 2 of 3 COLLEGE, INC. CTE No. Date issued SEP 390- 202Z 132022

TERMS AND CONDITIONS OF THE CERTIFICATE OF TAX EXEMPTION

under Section 30(H) of the National Internal Revenue Code of 1997, as Amended For Non-Stock, Non-Profit Educational Institution

TAX EXEMPTION 1) INCOME TAX. MATER DIVINAE GRATIAE COLLEGE, INC. is exempt from the payment of income tax only on revenues and receipts enumerated on the Certificate of requisites as set forth under Revenue Memorandum Order (RMO) No 44-2016, to wit: Tax Exemption. It is understood that the school must continue to meet the following

I. i.It is a non-stock, non-profit educational institution; and Its revenues are actually, directly and exclusively used for educational purposes.

audited financial statement together with the following: to compliance with the conditions that as a tax-exempt institution it shall on an annual basis under Section 27(D)(1) of the National Internal Revenue Code of 1997, as amended, subject submit to the Revenue District Office concerned an annual information return and duly deposits and yield from deposit substitute instruments used actually, directly and exclusively in pursuance of its purpose as an educational institution, are exempt from the 20% final tax and 15%' tax under the expanded foreign currency deposit system imposed MATER DIVINAE GRATIAE COLLEGE, INC.'s interest income from currency bank

b C) or placed in money markets, on or before the 1 5th day of the fourth month following the end of its taxable year (Sec. 4, Finance Department Order No. 137-87)2. Board Resolution by the school administration on proposed projects (i.e.. equipment, books and the like) to be funded out of the money deposited in banks Certification of actual utilization of the said income; and construction and/or improvement of school buildings and facilities, acquisition of from passive investment not subject to the 20% final withholding tax and 15% tax on interest income under the expanded foreign currency deposit system imposed by Section 27(D)(1) of the National Internal Revenue Code of 1997, as amended. Certification from their depository bank as to the amount of interest income earned

2) VALUE ADDED TAX (VAT) ON EDUCATIONAL SERVICES. Pursuant to Section within the premises of MATER DIVINAE GRATIAE COLLEGE, INC. are exempt non-profit educational institution are exempt from VAT. Moreover, revenues derived from assets used in the operation of cafeterias/canteens, dormitories and bookstores located from taxation provided they are owned and operated by it as ancillary services. DIVINAE GRATIAE COLLEGE, INC.'s, gross receipts from operations as a non-stock, 109(1)(H) of the National Internal Revenue Code of 1997, as amended, MATER

LIABILITY FOR INTERNAL REVENUE TAXES

1) INCOME TAX MATER DIVINAE GRATIAE COLLEGE, INC. is subject to income tax on all its under National Internal Revenue Code of 1997, as amended, on its income derived from any of its properties, real or personal, or any activity conducted for profit, which income should be returned for taxation, unless said revenues are actually, directly and exclusively used for educational purposes. income/receipts/revenues not expressly exempted and stated in the Certificate of Tax Exemption. Moreover, it is subject to the corresponding internal revenue taxes imposed

Deparment Order No. 149-95 dated'November 24.1995 amending Deparanent Order No.L37-87 1 Republic Act No. 10963 increased the tax rate froin 7.5% to 15% effective Jan. 1, 2018

Page 3 of 3 MATER DIVINAE GRA LEGE, INC. Date issued 2 SFP 13 2022 390-202Z

2) VALUE ADDED TAX/PERCENTAGE TAX from such sales exceed Three Million Pesos (P3,000,000.00)3, or to the 3% percentage tax. If MATER DIVINAE GRATIAE COLLEGE INC. is engaged in the sale of goods or services in the course of a business pursuit, including transactions incidental thereto, its revenues derived therefrom shall be subject to the 12% VAT, in case the gross receipts if gross receipts do not exceed P3,000,000.00.

Notwithstanding that it is a non-stock, non-profit corporation, its purchase of goods or properties, services and importation of goods shall nevertheless be subject to the 12% VAT pursuant to Sections 106, 108 and 107 of the National Internal Revenue Code of 1997, as amended.

3) WITHHOLDING TAX agent for the government if it acts as an employer and its employees receive compensation National Internal Revenue Code of 1997, as amended, as implemented by Revenue 98, as amended. MATER DIVINAE GRATIAE COLLEGE. INC. shall be constituted as withholding income subject to the withholding tax under Section 79 (A), Chapter XIII, Title II of the Regulations No. 2-98, as amended, or if it makes income payments to individuals or corporations subject to the withholding tax pursuant to Section 57 of the National Internal Revenue Code of 1997, as amended, and as implemented by Revenue Regulations No. 2-

TAXPAYER DUTIES & RESPONSIBILITIES 1) The honoraria/allowances given to members of the Board of Trustees must be reasonable and subject to iiquidation (DOF Opinion No. 005-2019).

2) Required to file on or before the 15th day of the fourth month following the end of the accounting period a Profit and Loss Statement and Balance Sheet with the Annual Information Copy of this Certificate of Tax Exemption shall be attached to the aforementioned Annual Return under oath, stating its gross income and expenses incurred during the preceding period and a certificate showing that there has not been any change in its By-laws, Articles of Incorporation, manner of operation and activities as well as sources and disposition of income. Information Return.

3) Under Section 235 of the National Internal Revenue Code of 1997, as amended, any provision of existing general and special law to the contrary notwithstanding, the books of accounts and other pertinent records of tax-exempt organization or grantees of tax incentives shall be' subject to it has been granted tax exemptions or tax incentives, and its tax liabilities, if any. examination by the BIR for purposes of ascertaining compliance with the conditions under which

4) Further, it is also required under Section 6(C) in relation to Section 237 of the National Internal Revenue Code of 1997, as amended, to issue duly registered receipts or sales or commercial invoices for each sale or transfer of merchandise or for services rendered which are not directly

related to the activities for which the Association is registered. (Revenue Memorandum Circular No. [RMC] No. 76-2003).

5) Finally, it is subject to the payment of registration fee of PhP 500.00 as prescribed in Section 236(B) of the National Internal Revenue Code of 1997, as amended.

3 Republic Act No. 10963 increased the VAT threshold from P1,919,500.00 to P3,000,000,00 effective Jan. i, 2018