BIR Ruling

March 21, 1967 Mr. Federico C. Alimusa 431 Bugallon, San Juan Rizal S i r : This refers to your letter dated February 20, 1967 requesting information on a query stated as follows: "(1) Is the service-connected disability compensation from the United States Veterans Administration of either a Philippine Scout or Commonwealth Army Veteran, taxable? cdll "(2) Is a disabled Phil. Scout or Commonwealth Army veteran without means of livelihood except their monthly compensation from the USVA required to file their income tax? "(3) If a Phil. Scout receives more than P1,000.00 and a Commonwealth Army veteran more than P700.00 monthly compensation from the USVA, are they required to buy Class "B" additional Residence Certificate? "(4) Is the monthly allowance from the USVA for educational assistance amounting to P260.00 of a dependent child also taxable?" llcd In reply thereto, I have the honor to inform you as follows: Pursuant to Sections 1 and 2 of Republic Act No. 360, pensions, compensation, allowances and other benefits received by a resident veteran and/or his beneficiary on or after June 9, 1949, from the United States Government, thru the United States Veterans Administration, are exempt from the income tax. Accordingly, a disabled Philippine Scout or Commonwealth Army Veteran who has no other source of income aside from such pensions, compensations, allowances and other benefits need not file an income tax return. Pursuant to Commonwealth Act No. 465, a Philippine Scout or Commonwealth Army Veteran who does not own any real property in the Philippines worth P15,000.00 or more, receives no salaries or wages and is not engaged in trade or business is not required to pay the additional residence tax (Class "B"). Moreover, being a part of the privilege or benefit enjoyed by a Philippine Scout or Commonwealth Army veteran under Republic Act No. 360, the monthly allowances from the United States Veterans Administration for educational assistance to a dependent child of the former in the amount of P260.00 is also exempt from the income tax. LibLex Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue