BIR Ruling

April 2, 1974 Mr. Francisco Farro 737 P. Leoncio St. Sampaloc, Manila S i r : In reply to your letter dated November 24, 1973, I have the honor to inform you of Presidential Decree No. 220 which took effect on June 20, 1973 exempting from Philippine income tax social security benefits, gratuities, pensions and other similar benefits, arising out of employment abroad and received by employees and workers who are retired and who came to reside in the Philippines for the remaining years of their lives, be they citizens of the Philippines or not, and whether the employer is a foreign government or a foreign private entity. The exemption equally applies to such incomes received by citizens of the Philippines after their retirement from the same sources even if they should continue to reside in the foreign country where they were employed or in any other country where they may emigrate after their retirement (Revenue Regulations No. 6-73 dated July 10, 1973 implementing Presidential Decree No. 220). Accordingly, social security benefits, gratuities, pensions or other similar benefits received by resident citizens, resident aliens and non-resident citizens from foreign governments or from foreign private entities during the taxable year 1973, i. e., January 1 to December 31, 1973 and thereafter shall be exempt from Philippine income tax. cdt You may direct your question and inquiries on the realty taxes to the Department of Finance; and to the City Government of Manila, with respect to the Local Tax Code. Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue TAN-1601-593-5