BIR Ruling No. 498-2018

BUREAU OF INTERNAL REVENUE REPUBLICOFTHF PHILIPPINES DEPARTMENT CF FINANCE Quezon (ity

Certificate of Tax Exemption No.

498-2018

CERTIFICATE OF TAX EXEMPTION issued to

8485 F. Reyes St., De Leon Compound, Balibago, Sta. Rosa City, Laguna KAINOS LEARNING INSTITUTE INC. SEC Company Reg. No. TIN:

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: This certifies that the above-named corporation is a non-stock, non-profit corporation

2. Income derived from the operation of cafeterias/canteens, dormitories and 1.Tuition fees and Other school fees; and for educational purposes. bookstores located within its premises, owned and operated by KAINOS LEARNING INSTITUTE INC., to be actually, directly and exclusively used

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.

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. for violation of any provisions of applicable rules and regulations of the BIR, or the terms and This certification shall be valid from the date of issuance until revoked by this Office

H 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 Issued this-day of MAR 14 2018 This Certificate of Tax Exemption is being issued on the basis of the facts and

1RanMy

K-1-JAC Commissioner of Internal Revenue CAESAR R.DULAY 014481

Page 2 of 3 Kainos Learning Institute Inc. CTE No.4982018 Date issued 3-14-2018

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

TAX EXEMPTION

1) INCOME TAX.KAINOS LEARNING INSTITUTE 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:

Office concerned an annual information return and duly audited financial statement together with the National Internal Revenue Code of 1997, as amended, subject to compliance with the conditions that as a tax-exempt educational institution it shall on an annual basis submit to the Revenue District the following: KAINOS LEARNING INSTITUTE INC.'s interest income from currency bank deposits and yield from deposit substitute instruments used actually, directly and exclusively in pursuance of its income under the expanded foreign currency deposit system imposed under Section 27 (D) (1) of purpose as an educational institution, are exempt from the 20% final tax and 7 1/2% tax on interest ii.Its revenues are actuaily, directly and exclusively used for educational purposes. It is a non-stock, non-profit educational institution; and

(a)Certification from their depository banks as to the amount of interest income earned from passive investment not subject to the 20% final withholding tax and 7 1/2% 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) VALUE ADDED TAX (VAT) ON EDUCATIONAL SERVICES. Pursuant to Section 109(1)(H) of the NIRC, KAINOS LEARNING INSTITUTE_INC.'s gross receipts from operations as a non-stock, non-profit educational institution are exempt from VAT.

LIABILITY FOR INTERNAL REVENUE TAXES

D) INCOME TAX

NIRC,as amended, on its income derived from any of its properties, real or personal, or any activity KAINOS LEARNING INSTITUTE INC. is subject to income tax on all its Exemption. Moreover, it is subject to the corresponding internal revenue taxes imposed under income/receipts/revenues not expressly exempted and stated in the Certificate of Tax

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

Kainos Learning Institute Inc. Page 3 of 3 Date issued 3-14-2018 CTE No.982018

actually, directly and exclusively used for educational purposes. conducted for profit, which income should be returned for taxation, unless said revenues are

2) VALUE ADDED TAX/PERCENTAGE TAX

If KAINOS LEARNING INSTITUTE INC. is engaged in the sale of goods or services in the therefrom shall be subject to the 12% VAT, in case the gross receipts from such sales is One Million course of a business pursuit, including transactions incidental thereto, its revenues derived tax, if gross receipts do not exceed P1,919,500.00. Nine Hundred Nineteen Thousand Five Hundred Pesos (P1,919,500.00), or to the 3% percentage

Sections 106 and 107 of the NIRC. 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

3WITHHOLDING TAX

government if it acts as an employer and its employees receive compensation income subject to the Revenue Regulations No. 2-98, as amended, or if it makes income payments to individuals or KAINOS LEARNING INSTITUTE INC. shall be constituted as withholding agent for the withholding tax under Section 79 (A), Chapter XIII, Title II of the NIRC, as implemented by

Corporations subject to the withholding tax pursuant to Section 57 of the NIRC, and as implemented

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

TAXPAYER DUTIES & RESPONSIBILITIES

1)KAINOS LEARNING INSTITUTE 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, manner 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.