BIR Ruling No. 529-2019

REPUELIC OF THE PHILIPPINES

DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE

Quezon Ciry

Certificate of Tax Exemption No.

0523-26t6

CERTIFICATTE GTTAX EXEMPTION

issued to

THE GOOD SHEPHERD SCHOOL OF IMELDA.INC

Riverside, Imelaa, Zamboanga Sibugay 7007

SEC Company Reg. No. TN:

This certifies that the above-narned corporation is a non-stock, non-prefit educational

institution and 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:

Y. Tuition fees and Otier schooi fees; and

Income derived from the operaticu of cafeterias/canteens, dormitories and bookstores located within its premises, owned and operated by THE GOOD SHEPHERD SCHOOL OF IMELDA, INC., to be actuaily, directly and exclusively used for educational purposes. Hothing follows

subject to the provisions of appiicable Ik ruies and regulations and the tax exemptions.

liabilities and responsibilities stated in the 'Terms and Conditions hereto attached and made an

integral part hereof. It is liable, however, to all other taxes not enumerated above.

This certification shall be valia frou the daie of issuance until revoked by this Office

tor 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 income tax exemption.

This Certificate of Tax Exemption is being issued on the basis of the facts and documents 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.

Issued this day of SEP 2 7.2050

Commissioner of Internal Revenue CAESAR R. DULAY 029050 K

THE GOOD SHEPHERD SCHOOL OF IMELDA. INC. CTE No. 0529-20

Page 2 oi'3 Date issued_ SFP? ?_?

TERMS AND CONDITIONS OF THE CERTIFICATE OF TAX EXEMPTION For Non-Stock, Nen-Profit Educational Institution under Section 30(H) of the National Internal Revenue Code of 1997 as Amended

TAX EXEMPTION

1) INCOME TAX.THE GOOD SHEPHERD SCHOOL OF IMELDA,INC. is exempt from the forth under Revenue Memorandum Oraer (RMO) No 44-2016, to wit: payment of income tax only on reverues and receipts enumerated on the Certificate of Tax Exemption. It is understood that the schcol must continue to meet the following requisites as set

ii. Its revenues are actuaily, directiy and exchusively used for educational purposes. It is a non-stock, non-profit educational institution; and

THE GOOD SHEPHERD SCHOOL OF IMELDA. INC.'s interest income from currency bank pursuance of its purpose as an educational institution, are exempt from the 20% final tax and 15%: deposits and yield from deposit substitute instruments used actually, directly and exclusively in

the conditions that as a tax-exempt educational institution it shall on an annual basis submit to the statement together with the following: Revenue District Office concerned an annual information return and duly audited financial tax on interest income under the expanded foreign currency deposit system imposed under Section 27 (D) (1) of the National Internai Revenue Code of 1997, as amended, subject to compliance with

system imposed by Section 27 (D) (1) of the National Internal Revenue Code of 1997. as amended; and 15%' tax on interest income under the expanded foreign currency deposit (a)Certification from their depository banks as to the amount of interest income earned from passive investnent not subiect to the 20% final withholding tax

(b)Certification of actual utilization of the said income; and

of equipment, books and the like) to be funded out of the money deposited in following the end of its taxable year (Sec. 4, Finance Department Order No. 137-87)2 (c)Board Resolution by the school administration on proposed projects (i.e. construction and/or improvement of school buildings and facilities, acquisition banks or placed in money markets, on or before the 1 5th day of the fourth month

2) VALUE ADDED TAX (VAT) ON EDUCATIONAL SERVICES. Pursuant to Section

and bookstores tocated within the premises of THE GOOD SHEPHERD SCHOOL _OF activities. receipts from operations as a non-stock, non-profit educational institution is exempt from VAT Moreover, revenues derived from assets used in the operation of cafeterias/canteens, dormitories IMELDA, INC. are exempt from taxation provided they are owned and operated by it as ancillary 109(1)(H) of the NIRC, THE GOOL_SHEPHERD SCHOOL OF IMELDA, INC.'s gross

2 Depariment Order No. 149-95 dated No vember 24, 1995 amending Department Order No. 137-87. : Republic Act N. 10963 increased the i:x rate from 7.5% to 15% etfective January 1. 2018. :

Page 3 of 3 THE GOOD SHEPHERD SCHOOL OF IMELDA,INC. CTE No. Date issued_SEP 2 1 TU TE

LIABILITY FOR INTERNAL REVENUE TAXES

1) NCOME TAX.

THE GOOD SHEPHERD SCHOOL OF IMIELDA INC. is subject to income tax on all its

income/receipts/revenues not expressiy exempted and stated in the Certificate of Tax

Exemption. Moreover, it is subject to the corresponding internal revenue taxes imposed under NIRC, as amended, on its income derived from any of its properties, real or personal, or any activity

conducted for profit, which income shouid be returned for taxation, unless said revenues are

actually, directly and exclusively used for educational purposes.

2) VALUE ADDED TAX/PERCENTAGE TAX :

If THE GOOD SHEPHERD SCHOOL OF IMELDA, 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 1 2% V AT, in case the gross receipts from such sales exceed

Three Million Pesos (F3,000,000.00), or to the 3% percentage tax, if gross receipts do not exceed P3.000,000.00.

Notwithstanding that it is a non-stock, nici-profit corporation, its purchase of goods or properties or services and importation of goods shali nevertheless be subject to the 12% VAT pursuant to

Sections 106 and 107 cf the NIRC.

3) WITHHOLDING TAX.

THE GOOD SHEPHERD SCHOOL OF IMELDA, INC. shall be constituted as withholding

agent for the government if it acts as an employer and its empioyees receive compensation income

subject to the withholding tax' under Section 79 (A), Chapter XIHI, Title II of the NIRC, as

implemented by Revenue Regulatiens No. 2-98, as amended, or if it makes income payments to

individaals or corporations subject to the withholding tax pursuant to Section 57 of the NIRC, and

as implemented by Revenue Regulations No.: 2-98, as amended.

TAXFAYER DUTIES & RESPONSBILITIES

1)THE GOOD SHEPHERD SCHOOL OF IMELDA,INC. is 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 Inforrnation 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. Copy of this Certifieate of Tax Exemption shall be attached to

the aforementioned Annual Information Return.

2) 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

examination by the BIR for purposes of ascertaining compliance with the conditions under which

it has been granted tax exemptions or tax incentives, and its tax liabilities, if any.

3) Further, it is also required under Sectior 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 mierchandise 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).

4) Finally, it is subject to the payment oft'registration fee of PhP 500.00 as prescribed in Section 236

(B) of the Nationai Internal Revenue Codt. cf 1997. as amended

3 Republic Act No. 10963 increased the VAT threshold irom P1,919,500.00 to P3,000,000.00 effective january 1, 2018.