Public Safety Savings & Loan Association, Inc.

December 12, 2008 BIR RULING [DA-(TSF-014) 523-08] DA 406-05 Public Safety Savings & Loan Association, Inc. Ground & 2nd Floor Kiangan Hall Camp Crame, Quezon City Attention: Mr. Robert P. Santos Finance Manager Gentlemen : This refers to your letter dated December 3, 2008 requesting for a certificate of tax exemption from the 20% final withholding tax on the interest income from its bank deposit and deposit substitutes pursuant to Section 5 of Republic Act (R.A.) No. 8367, otherwise known as "The Revised Non-Stock Savings and Loan Association Act of 1997". In reply thereto, please be informed that Section 5 of R.A. No. 8367 entitled "An Act Providing for the Regulation of the Organization and Operation of Non-Stock Savings and Loan Association", provides, viz. : "Sec. 5. Tax Exemption. An Association shall be exempt from payment of tax in respect to income it receives, including interest on its deposits with any bank; Provided, however, That income derived from any of its properties, real or personal, or any activity conducted for profit, regardless of the disposition thereof, is subject to the corresponding internal revenue taxes imposed under the National Internal Revenue Code. CHDTIS Interest earnings on deposits of members with Associations, as well as the shares of its members from the net income of the Associations shall be exempt from income tax." Based on the foregoing, this Office holds that interest income derived by Public Safety Savings and Loan Association, Inc. from its deposit and deposit substitutes is exempt from the 20% final withholding tax. 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. Very truly yours, (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service