BIR Ruling

September 27, 1976 Atty. Amando K. Gaitos Mezzanine Floor, Del Mundo Bldg. 2121 Taft Avenue, Manila S i r : This refers to your letter dated September 9, 1976 requesting that the donation in the amount of P600,000.00 to your client, the Salvation Army (Philippines) Inc., a religious organization be deductible in full from the gross income of the donor, William J. Shaw Foundation, Inc. pursuant to Presidential Decree No. 507. In reply, I have the honor to inform you that in our letter to you dated February 9, 1976, we held that your client is not qualified to avail of the benefits of Presidential Decree No. 507, for the reason that your client is essentially a religious organization. Although the organization may be undertaking charitable and social welfare activities such activities are merely incidental to the purpose for which it was organized, which is religious (See BIR Ruling No. 75-001 dated January 14, 1975). In view therefore, your request is hereby denied. However, the said donation is deductible from the gross income of the donor, provided that the amount claimed as deduction is not in excess of three per centum of its taxable net income, as computed in accordance with Section 30(h) of the Tax Code. Very truly yours, EFREN I. PLANA Acting Commissioner of Internal Revenue TAN-1456-040-3