BIR Ruling No. 561-2020

BUREAU OF INTERNAL REVENUE REP YBLICOF THE PHILIPPINES DEPARTMENT OF FINANCE

Quezon City

Certificate of Tax Exemption No:

BOI-LEH -.0 5 6 1 - 2 0 2 U

CERTIFICATE OF TAX EXEMPTION

TO ALL WHOM IT MAY CONCERN:

as amended, provided that the selling price of said residential units does not exceed Identification Number (TIN) withholding tax on its income received directly in connection with its economic and low-cost housing project (vertical), Vine Residences Phase 3 (Tower 5) -- Brgy. San Bartolome, Novaliches, Quezon City, consisting of 05, 2017, for a period of three (3) years beginning from December 29, 2017 to December 28, 2020, 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 (RR) No. 2-98. P3,000,000.00 per residential unit. dwelling purposes, located at Brgy. San Bartolome, Novaliches, Quezon City, a project duly registered with the Board of Investments (BOI) under Registration No. This certifies that SM DEVELOPMENT CORPORATION, with Taxpayers residential units used solely for family home or , is exempt from income tax and creditable dated May

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

appropriate taxes under the National Internal Revenue Code of 1997, as amended. purposes such as leasing, retail stores, offices, etc., shall be subject to the payment of with the BOI, if any, as well as the 83 parking slots, including those units used for commercial However, the sale of residential units in excess of the 396 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

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. This Certificate of Tax Exemption is being issued on the basis of the facts and Issued this day of OCT 0 1 2020

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K1-GPS Commissioner of Internal Revenue CAESAR R. DULAY 036870

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

SM DEVELOPMENT CORPORATION [Vine Residences Phase 3 (Tower 5)] Date issued: ITE No.: BQITLEH UC1U Zu28 0561-2020

OF THE CERTIFICATE OF TAX EXEMPTION TERMS AND CONDITIONS

1. The exemption from income and creditable withholding taxes covers only income directly

Such exemption shall not cover revenues from units with selling price exceeding P3,000,000.00. attributable to the revenues generated from the project, Vine Residences Phase 3 (Tower 5) - for family home or dwelling purposes, located at Brgy. San Bartolome, Novaliches, Quezon City. Brgy. San Bartolome, Novaliches, Quezon City, consisting of 396 residential units used solely

2 The Company is obligated to construct and sell 396 residential units based on the following

schedules/sales revenues:

Year (No. of Units) Volume 1 95 (in PhP 000) Value

Total 2 201 396

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.

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 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. incentives, VAT and duty exemptions, deductions, credits or exclusions from the tax base, as may

h 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 examination by revenue enforcement officers of this Bureau for the 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 1997, as amended.

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

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