BIR Ruling No. 83-2020

REPUBLIC OF THE PHILIPPINES

DEPARTMENT OF FINANCE

BUREAU OF INTERNALREVENUE

Quezon City

Certificate of Tax Exemption No. SH30-015-2020

CERTIFICATE OF TAX EXEMPTION

issued to

Villa Olympia Subdivision, San Pedro, Laguna 4023 MATER ECCLESIAE SCHOOL,INC TIN:

SEC Company Reg. No.

has proven by actual operation that its primary purpose is one of those enumerated under Section TAX only on the following revenues or receipts: 30(H) of the National Internal Revenue Code of 1997, as amended. It is exempt from INCOME This certifies that the above-named corporation is a non-stock, non-profit corporation and

1 Tuition and Miscellaneous Fees; and

2 Income derived from .the operation of cafeterias/canteens, dormitories -and

bookstores located within its premises, owned and operated by MATER ECCLESIAE SCHOOL. INC.,to be actually, directly and exc!usively used for educational purposes.

-nothing follows-

subject to the provisions of applicable BIR rules 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 valid from the date of issuance until revoked by this Office for 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 ascertainis that the facts are

different, then this Certificate shall be considered null and void.

Issued this day ofJAN 2 4 2020

Maeeemrey

CAESAR R.DULAY

K Commissioner of Internal Revenue 032253

MATER ECCLESIAE SCHOOL, INC. Page 2 of 3 Date issued CTE No. SH30-015-2020 JAN 2 4 2020

TERMS AND CONDITIONS OF THE CERTIFICATE OF TAX EXEMPTION

For Non-Stock, Non-Profit Educational Institution

under Section 30(H of the National Internal Revenue Code of 1997, as Amended

TAX EXEMPTION

1) INCOME TAX. MATER ECCLESIAE SCHOOL, INC. is exempt from the payment 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 set forth under Revenue Memorandum Order (RMO) No 44-2016, to wit:

I It is a non-stock, non-profit educational institution; and

I. Its revenues are actually, directly and exclusively used for educational purposes.

MATER ECCLESIAE SCHOOL, INC.'s interest income from 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 20% final tax and 15%' tax under the expanded foreign currency deposit system imposed under Section 27(D)(1) of the National Internal Revenue Code of 1997, asamended, subject 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 subiect 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.

MATER ECCLESIAE SCHOOL, INC.'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 MATER ECCLESIAE SCHOOL, INC. are exempt from taxation provided

they are owned and operated by it as ancillary services.

LIABILITY FOR INTERNAL REVENUE TAXES

1) INCOME TAX

MATER ECCLESIAE SCHOOLINC. 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

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

of its properties, real or personal, or any activity conducted for profit, which income should

Republic Act No. 10963 increased the tax rate from 7.5% to 15% effective Jan. 1, 2018 Department Order No.149-95 dated November 24.1995 amending Department Order No. 137-87

MATER ECCLESIAE SCHOOL, INC. Page 3 of 3 Date issued CTE No. SH30-0152020 JAN Z 4

be returned for taxation, unless said revenues are actually, directly and exclusively used for educational purposes

2) VALUE ADDED TAX/PERCENTAGE TAX If MATER ECCLESIAE SCHOOL, INC. is engaged in the sale of goods or services in the course of a business pursuit, including transactions incidental thereto, its revenues derived Three Million Pesos (3,000,000.00)3, or to the 3% percentage tax, if gross receipts do not exceed P3,000,000.00. therefrom shall be subject to the 12% VAT, in case the gross receipts from such sales exceed

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

amended.

3) WITHHOLDING TAX MATER ECCLESIAE SCHOOL, INC. shall be constituted as withholding agent for the

government if it acts as an employer and its employees receive compensation income subject

to the withholding tax under Section 79 (A), Chapter XIII, Title 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 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

1 MATER ECCLESIAE SCHOOL, 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 Information 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, maniner 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 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 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