Strata 2000 Condominium Corporation

March 13, 2008 BIR RULING [DA-155-08] RR No. 8-2005; DA-097-2006; DA-390-06 Strata 2000 Condominium Corporation Strata 2000 Bldg., F. Ortigas Jr. Road, Ortigas Center, Pasig City Attention: Mark Jordan A. Del Rosario Building Administrator Gentlemen : This refers to your letter dated January 23, 2008 requesting for tax exemption on Meralco's refund to the Corporation under Revenue Regulation No. 8-2005. It is represented that Strata 2000 Condominium Corporation is a non-stock, non-profit corporation duly registered with the Securities and Exchange Commission (SEC) under SEC Registration No. 121214 and that it was already issued by the Bureau of Internal Revenue a Certificate of Tax Exemption under BIR Ruling No. DA-629-2007 dated December 7, 2007. In reply, please be informed that your case is similar to the case in BIR Ruling No. DA-390-2006 dated June 23, 2006. The facts of the case are as follows: LSHA is a non-stock, non-profit corporation. It has a refund of the excess utility payments with MERALCO covering the period 1995 to 2003. It is not engaged in any profitable activities that would result in the imposition of income taxes, consequently, it has not claimed the above utility payments as deductions for income tax purposes. It is not subject to income tax, thus, it has not claimed the utility payments as deductions resulting in a benefit. This Office ruled in said case that aCATSI ". . . considering that LSHA is an organization exempt from income tax and it has not been engaged in any profitable activities that would result in the imposition of taxes, thereby it has not claimed the above utility payments as deductions for income tax purposes, the refund of the excess utility payments in its favor, therefore, will not give rise to or create a taxable income. Consequently, said refund is not subject to the withholding tax prescribed under R R N o. 8-2005." Since the refund of the excess utility payments in favor of Strata 2000 Condominium Corporation will not give rise to or create a taxable income, the refund of the excess utility payments with MERALCO is not subject to the withholding tax considering that Strata 2000 is a non-stock, non-profit corporation and is not engaged in any profitable activities. This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be ascertained that the facts are different, then this ruling shall be considered null and void. Very truly yours, Commissioner of Internal Revenue By: (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service