BIR Ruling [DA-535-04]

October 27, 2004 BIR RULING [DA-535-04] 60 (B); DA 199-02 Manila Cordage Company c/o Feliciano F. Miravite, Inc. 12th Floor L.V. Locsin Building corner Ayala and Makati Avenues Makati City Attention: Ms. Agnes Lopez Senior Analyst Gentlemen : This refers to your letter dated October 26, 2004 requesting a ruling to the effect that the interest and/or yield from the deposit substitutes and investment of the trust fund of the Manila Cordage Company Employees' Retirement Plan is exempt from the 20% final tax. It appears that on March 4, 1991, this Office has duly approved the Manila Cordage Company Employees' Retirement Plan as a reasonable retirement benefit plan under then R.A. No. 4917. In reply thereto, please be informed that under Section 60 (B) of the Tax Code of 1997, the income of an employees trust are exempt from income tax. SUCH BEING THE CASE, this Office holds that the interest from currency bank deposit and yield or any monetary benefit from deposit substitutes and from trust funds and similar arrangements derived by the Manila Cordage Company Employees' Retirement Plan which is an employee's trust are exempt from the 20% final tax under Section 24 (B) (1) of the Tax Code of 1997. (CIR vs. GCL Retirement Plan, G.R. No. 95022 dated March 23, 1992) This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. AEIHCS Very truly yours, (SGD.) MILAGROS V. REGALADO Assistant Commissioner Legal Service