BIR Ruling [DA-170-98]

April 24, 1998 BIR RULING [DA-170-98] J.B. Del Rosario and Associates Suite 505-507 West City Plaza Building 66 West Avenue 1100 Quezon City Attention: Mr . Jose B . del Rosario Principal Architect Gentlemen : In reply to your letter dated April 3, 1998, please be informed that your general professional partnership of architects formed for the purpose of practising your profession is exempt from income tax pursuant to Section 26 of the Tax Code of 1997. Accordingly, payments to said partnership for professional services rendered are exempt from the withholding tax provisions of Revenue Regulations No. 6-85, otherwise known as the Revised and Consolidated Expanded Withholding Tax Regulations, implementing then Section 50(b) of the Tax Code, as amended, now Section 57(B) of the Tax Code of 1997. (BIR Ruling No. 160-91 dated August 21, 1991) However, partners in a general professional partnership, such as in your case, shall be liable to income tax only in their separate and individual capacities, based on their distributed shares from the net income of the partnership, whether actually or constructively received. For purposes of computing the distributive shares of the partners, the net income of the partnership shall be computed in the same manner as a corporation. Finally, the income tax returns of the partners shall be filed on a quarterly basis. cdtech Very truly yours, (SGD.) SIXTO S. ESQUIVIAS IV Deputy Commissioner Legal & Enforcement Group