BIR Ruling

September 29, 1969 Action Line c/o the Manila Times P.O. Box 775 Manila S i r : This refers to the letter addressed to your column by Mr. Tomas Macaranas of Hagonoy, Bulacan, dated February 17, 1969 requesting legal opinion on a query stated as follows: prcd "I am a retired employee of the National Government under RA 4968 (optional) after rendering 28 years of long and faithful service. Luckily, I was already paid my retirement gratuity. Chapter I, No. 5 of the Income Tax Primer does not include this retirement under the list of non-taxable incomes. The retirement pay under RA 660 is non-taxable. May I know if the gratuity I received is also non-taxable?" In reply thereto, I have the honor to inform you that pursuant to Section 28(c) of Commonwealth Act No. 186 as amended, all benefits granted by the Government Service Insurance System shall be exempt from all types of taxes. Accordingly, retirement gratuity and annuities received by a member of the system under Republic Act No. 4968 and Republic Act No. 660 are not subject to tax and need not be included or declared as part of the gross income tax purposes. Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue