BIR Ruling

October 15, 1971 Atty. Ruben G. Bragado Nuevo Iloco, Mawab Davao del Norte S i r : This refers to your letter dated April 23, 1971 requesting information on whether or not your parents, Mr. and Mrs. Cipriano Bragado are subject to Philippine income tax on the benefits and/or pensions which they are receiving from the United States Social Security Commission. In reply, I have the honor to inform you that under Section 45(1)(A) & (B) of the Tax Code, as amended by R.A. No. 6110, every Filipino citizen, whether residing in the Philippines or abroad, and every alien residing in the Philippine, regardless of whether his gross income was derived from sources within or without the Philippines, are required to file income tax returns and to pay the tax thereon. Moreover, Republic Act No. 4917 is by express provision applicable only to retirement benefits of officials and employees of private firms in the Philippines. Accordingly, social security pensions of retired U.S. Government employees are not covered by the said law. In view thereof, and considering that there is no law declaring U.S. Social Security Pensions exempt from Philippine income tax, the pensioner or retiree, like your parents, are required to file their joint income tax return every year if their total gross income which include said pension received each year amounts to One thousand eight hundred pesos, or more. (Sec. 45, N.I.R.C.) aisa dc Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue