BIR Ruling No. 267-2020

BUREAU'OF INTERNAL REVENUE REPUBLIC OF THE PHILIPPINES DEPARTMENT OF FINANCE

Quezon City

Certificate of Tax Exemption No:

BOI-LEH - 0 2 6 7 - 2 0 2 0 CERTIFICATE OF TAX EXEMPTION

TO ALL WHOM IT MAY CONCERN:

earlier, but in no case earlier than the date of registration of the project with the BOI, pursuant to Executive Order (EO) No. 226, otherwise known as the "Omnibus Investments Code of Sunset Drive, Mall of Asia Complex, Pasay City, consisting of 1,634 housing units used Solely for family home or dwelling purposes, located at Seaside Boulevard corner Sunset Drive, Mall of Asia Complex, Pasay Citv.a project duly registered with the Board of Investments beginning from November 2014 or actual start of commercial operations/selling, whichever is withholding tax on its income received directly in connection with its low cost mass housing project (vertical), Shore Residences Tower A and Tower Bi- Seaside Boulevard corner (BOI) under Registration No. . 1987 and Section 2.57.5 (B) (2) of Revenue Regulations (RR) No. 2-98, as amended. Identification Number (TIN) This certifies that SM DEVELOPMENT CORPORATION, with Taxpayers dated March 05, 2014, for a period of three (3) years , 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 Revenue Code of 1997, as amended.Provided, however, that beginning January 01, 2021, the 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. Moreover, the sale by the Company of residential lot valued at P1,919,500.00 and

the BOI (per License to Sell No. units), as well as the 30 commercial units and 1,535 parking slots, including those other units used for commercial purposes such as leasing, retail stores, offices, etc., shall be subject to the payment of appropriate taxes under the National Internal Revenue Code of 1997, as amended. However, the sale of housing units in excess of the 1,634 housing units registered with dated May 27, 2014, the excess is 4,0573 housing

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 of_MAY 2 5 2020

ea

Sale of lot only,regardless of the price, shall be subject toVAT starting January O1, 2021 pursuant to Republic Act (RA) 3 Out of the excess of 4,057 housing units, 3,483 housing units covering Shore Residences Towers C and D were the subject K-1-LMAT of Certificate of Tax Exemption No. 209-2018 dated February 20, 2018. The Alteration of Plan issued by the Housing and Land Use Regulatory Board (HLURB) dated February 24, 2014 shows that Shore Residences under Certificate of Registration No. 25781 and License to Sell No. 029190 both dated May 27.2014 includes Towers A, B. C., and D. No. 10963. Commissioner of Internal Revenue CAESAR R.DULAY 403361.4

SM DEVELOPMENT CORPORATION (Shore Residences Tower A and Tower B) Date issued: CTE No.: MAY 2 6 2020 BOI-LEH-0 26 7 - 20 2 Q

OF THE CERTIFICATE OF TAX EXEMPTION TERMS AND CONDITIONS

1. The exemption from income and creditable withholding taxes covers only income directly attributable to the revenues generated from the project, Shore Residences Tower A and Tower B corner Sunset Drive, Mall of Asia Complex, Pasay City. Such exemption shall not cover revenues -- Seaside Boulevard corner Sunset Drive, Mall of Asia Complex, Pasay City, consisting of 1,634 housing units used solely for family home or dwelling purposes, located at Seaside Boulevard] from units with selling price exceeding P3,000,000.00.

2 The Company is obligated to construct and sell 1,634 housing units based on the following

schedules/sales revenues:

Year 1 (No. of Units) Volume 1,011 (PhP'000) 2,852,408 Value

2 3 500 1 23 1,410,686 347,029

Total 4 1,634 4,610,123

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 RepublicAct(RA) No: 107084, 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 incentives, VAT and duty exemptions,deductions, credits or exclusions from the tax base, as may 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.

6. The Company shall be constituted as a withholding agent for the government if it acts as employer 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 amended, and implemented by Revenue Regulations (RR) No. 2-98, as amended.

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. PAGE2OF2