BIR Ruling No. 605-2020

REPUBLICOFTHE PHILIPPINES

DEPARTMENT OF FINANCE BUREAU OF INTERNALREVENUE Quezon City

Certificate of Tax Exemption No. SH30-0605-2020

CERTIFICATE OF TAX EXEMPTION

issued to

1648 Taft Avenue corner Pedro Gil St., Brgy. 694, Zone 075, Malate, Manila PHILIPPINE CHRISTIAN UNIVERSITY CORPORATION 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

2. Student activities and laboratory fees; and 1. Tuition and matriculation fees; 3. Income derived from the operation of cafeterias/canteens, CHRISTIAN UNIVERSITY CORPORATION, to be actually, directly and bookstores located within its premises, owned and operated by exclusively used for educational purposes. dormitories and PHILIPPINE

--nothing follows.

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

conditions herein set forth. It shall likewise be revoked if there are material changes in the violation of any provisions of applicable rules and regulations of the BIR, or the terms and character, purpose or method of operation of the corporation which are inconsistent with the basis for its income tax exemption. 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 OCT 2 7 2020

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K-1 Commissioner of Internal Revenue CAESAR R.DULAY Bd 037289

PHILIPPINE CHRISTIAN UNIVERSITY CORPORATION Page 2 of 3 Date issued_9CT 2 7 2U28 CTENo.SH(30.- D 6 05 - 2 0 2 0

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

set forth under Revenue Memorandum Order (RMO) No 44-2016, to wit: of income tax only on revenues and receipts enumerated on the Certificate of Tax Exemption. It is understood that the school must continue to meet the following requisites as PHILIPPINE CHRISTIAN UNIVERSITY CORPORATION is exempt from the payment

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

currency bank 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 PHILIPPINE CHRISTIAN UNIVERSITY CORPORATION's interest income from

under Section 27(D)(1) of the National Internal Revenue Code of 1997, as amended, subject 20% final tax and 15%' tax under the expanded foreign currency deposit system imposed

to compliance with the conditions that as a tax-exempt institution it shall on an annual basis submit to the Revenue District Office concerned an annual information return and duly

audited financial statement together with the following:

(a Certification from their depository bank as to the amount of interest income

earned 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.

b Certification of actual utilization of the said income; and

c Board Resolution by the school administration on proposed projects (i.e.,

construction and/or improvement of school buildings and facilities, acquisition

of equipment, books and the like) to be funded out of the money deposited in

banks or placed in money markets, on or before the 15th day of the fourth

month following the end of its taxable year (Sec. 4, Finance Department Order

No. 137-87)2.

2) VALUE ADDED TAX (VAT) ON EDUCATIONAL SERVICES.

Pursuant to Section 109(1)(H) of the National Internal Revenue Code of 1997, as amended,

PHILIPPINE CHRISTIAN UNIVERSITY CORPORATION's, gross receipts from

operations as a non-stock, non-profit educational institution are exempt from VAT.

Moreover, revenues derived from assets used in the operation of cafeterias/canteens,

dormitories and bookstores located within the premises of PHILIPPINE CHRISTIAN

UNIVERSITY CORPORATION are exempt from taxation provided they are owned and

operated by it as ancillary services.

LIABILITY FOR INTERNAL REVENUE TAXES

1 INCOME TAX

PHILIPPINE CHRISTIAN UNIVERSITY CORPORATION is subject to income tax on

all its 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

Republic Act No. 10963 increased the tax rate from 7.5% to 15% effective Jan. 1, 2018

2 Department Order No. 149-95 dated November 24, 1995 amending Department Order No. 137-87

Page 3 of 3 PHILIPPINE CHRISTIAN UNIVERSITY CORPORATION CTENo.SH30-0605 -20 20 Date issued_OCT2 7 2020

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. under National Internal Revenue Code of 1997, as amended, on its income derived from any

2) VALUE ADDED TAX/PERCENTAGE TAX gross receipts do not exceed P3,000,000.00. If PHILIPPINE CHRISTIAN UNIVERSITY CORPORATION 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 from such sales exceed Three Million Pesos (P3,000,000.00)3, or to. the 3% percentage tax, if

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

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

TAXPAYER DUTIES & RESPONSIBILITIES of operation and activities as well as sources and disposition of income. Copy of this Certificate of Tax Exemption shall be attached to the aforementioned Annual Information PHILIPPINE CHRISTIAN UNIVERSITY CORPORATION, is required to file on or 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 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 Return under oath. Return.

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

3) 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).

4) 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.

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