BIR Ruling No. 565-2020

BUREAU OF INTERNAL REVENUE REPUBLIC OF THE PHILIPPINES DEPARTMENT OF FINANCE

Quezon City

Certificate of Tax Exemption No:

BOI-LEH - 0 5 65 - 2 0 2 0

CERTIFICATE OF TAX EXEMPTION

TO ALL WHOM IT MAY CONCERN:

housing project (vertical), Spring Residences Phase 2 (Tower 4) -- West Service Road, (RR) No. 2-98, as amended, provided that the selling price of'said residential units does 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 368 residential units used solely for July 05, 2018 to July 04, 2021, pursuant to Executive Order (EO) No. 226, otherwise known as the Omnibus Investments Code of 1987 and Section 2.57.5 (B) (2) of Revenue Regulations family home or dwelling purposes, located at West Service Road, Barangay Sun Valley, Paranaque City, a project duly registered with the Board of Investments (BOI) under 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 residentiai 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 77 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 with the BOI (per License to Sell No. the National Internal Revenue Code of 1997, as amended. However, the sale of residential units in excess of the 368 residential units registered dated July 05, 2018, the excess is 23 residential

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 ofOCT 0 1 2020

aae,a1y

K-1-LMAT Commissioner of Internal Revenue CAESAR R. DULAY 036868

Sale of lot only, regardless of the price, shall be subject to VAT starting January O01. 2021 pursuant to Republic Act (RA) Per Certification dated June 25, 2020 issued by the BOI. No. 10963.

(Spring Residences Phase 2(Tower 4)] SM DEVELOPMENT CORPORATION Date issued: CTE No.: BOILEH- 0C 0555-2020 Zua

TERMS AND CONDITIONS

OF THE CERTIFICATE OF TAX EXEMPTION

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 4) - West Service Road, Barangay Sun Valley, Paranaque City, consisting of 368 residential units

used solely for family home or dwelling purposes, located at West Service Road, Barangay Sun Valley, Paranaque City. Such exemption shall not cover revenues from units with selling price exceeding P3,000,000.00.

2. The Company is obligated to construct and sell 368 residential units based on the following

schedules/sales revenues:

Year Total 2 (No. of Units) Volume 368 200 100 68 (in PhP 000) 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

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. 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

6.The Company shall be constituted as a withholding agent for the government if it acts as employer 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 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.

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 examination by revenue enforcement officers of this Bureau for the purpose of ascertaining whether and its tax liability, if any, pursuant to Section 235 of the National Internal Revenue Code of 1997, it is complying with the conditions under which it has been granted tax exemption or tax incentives

as amended.

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

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