BIR Ruling

July 3, 1970 Mindoro College Calapan, Oriental Mindoro Attention: Most Rev . William Jos , Dusbak Chairman, Board of Trustees Gentlemen : This refers to your letter requesting exemption of the Mindoro College of Calapan, Oriental Mindoro, from the payment of income tax and filing of the corresponding income tax return under Section 27 (e) of the Tax Code. Investigation disclosed that the Mindoro College (hereinafter referred to as the School) is a non-stock, non-profit, religious-educational corporation duly registered with the Securities and Exchange Commission; that the purposes for which the school was established are: to instruct the educate boys and girls; to promote the principles of true higher education; to establish and maintain a Catholic institution of learning where thorough and systematic instruction shall be given in the arts and sciences and letters for which the usual diploma be awarded; and to educate and train students in such branches and methods as will best suit them for successful work in the field of education and professional undertakings; that the school shall have the power subject to the limitations imposed by law to purchase, hold, own, mortgage, pledge, lease and sell real and personal property, use its own seal and exercise all rights and power inherent, incidental and implied according to the laws of the Republic of the Philippines; that the school and its principal office shall be established and located in the town of Calapan, province of Oriental Mindoro; that the school shall be maintained by means of tuition, matriculation, entrance and other fees collected from the students and such other income that may be acquired from its present or future activities and properties; that the school derives no income from its properties or from any activity conducted for profit; that if the school derives income from any source whatsoever, it is merely incidental to its activities as a non-stock, non-profit, religious-educational and other related activities; and that no part of its income, if any inures or accrues to the benefit of any private individual or shareholder, as this is a non-stock corporation. In view of the foregoing, this Office is of the opinion as it hereby holds that the Mindoro College is exempt from the payment of income tax under Section 27 (e) of the Tax Code. The school is, however, subject to income tax on income derived from any of its properties, real or personal, or from any activity conducted for profit, regardless of the disposition made of such income. If it has not earned any taxable income, it is also exempt from the filing of income tax returns. Moreover, the school 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 and a certificate showing that there has not been any substantial change in its By-Laws, Articles of Incorporation, manner of operation and activities as well as sources and disposition of income. aisadc Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue