BIR Ruling

May 21, 1973 Dr. Eliodoro D. Congco President, The Family Clinic, Inc. 1474 Maria Clara, Sampaloc, Manila S i r : This refers to your letter dated May 3, 1973 requesting that your Corporation be allowed to file separate income tax returns, one return for the hospital and another return for the two schools it operates. It is represented that the Family Clinic, Inc. is a domestic corporation engaged in the operation of a hospital since 1953; that it also operates a School of Nursing and a School of Radiologic Technology, duly licensed, which is related to the main object for which the hospital was established; that in the past the income and expenses of these schools were consolidated with that of the hospital although separate books of accounts are kept for the hospital and the schools; and that the corporation would like to file separate income tax returns so that it will pay 35% income tax for the hospital and 10% tax for the educational institution. In reply thereto, I have the honor to inform you that your request is hereby granted. Accordingly, the Corporation should file an income tax return declaring the gross income derived in the operation of the hospital less the allowable deductions to arrive at the taxable net income which is subject to 25% or 35% income tax. Likewise, the Corporation shall file another return declaring the gross income derived in the operation of its two (2) schools less the allowable deductions to arrive at the taxable net income which is subject to 10% income tax imposable on private educational institutions. Very truly yours, (SGD.) CONRADO P. DIAZ Acting Commissioner of Internal Revenue