BIR Ruling

February 16, 1972 Messrs. Carlos J. Valdes & Co. 1130 Perez Street Paco, Manila Gentlemen : This refers to your letter dated November 16, 1971 requesting that your client, Our Lady of the Rosary Foundation, Inc., be granted exemption from the payment of income tax as a title-holding corporation under Section 27(k) of the Tax Code. In reply thereto, I have the honor to inform you that the second paragraph of the Foundation's Amended Articles of Incorporation which was filed with the Securities and Exchange Commission on February 4, 1972, reads as follows: "Second. That the Corporation is organized for the exclusive purpose of holding title to properties real or personal, collecting income therefrom, and turning over the entire amount thereof, less expenses, to a tax-exempt organization. And for the accomplishment of the purpose for which this was organized, for the rehabilitation of the lepers and other homeless and needy soul. (As amended on July 24, 1971.)" From the abovequoted provision of its Amended Articles of Incorporation, the Foundation falls within the purview of Section 27(k) of the Tax Code as a title-holding corporation. In view thereof, this Office is of the opinion that the Our Lady of Rosary Foundation, Inc. is exempt from the payment of income tax under Section 27(k) of the Tax Code. Moreover, it is exempt from the filing of income tax returns. However, the Foundation is required to file on or before April 15 of each year, 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 year, the tax-exempt organizations receiving such income less expenses 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. cdta Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue