Exemption from Income Tax — Provident Fund

January 12, 1981 BIR RULING NO. 006-81 56-b 000-00 006-81 Bangko sa Lupa ng Pilipinas (Land Bank of the Philippines) 6th Floor, B.F. Condominium Bldg. Intramuros, Manila Attention: Atty . A . B . F . Gaviola, Jr . Legal Counsel Gentlemen : This refers to your letter dated June 20, 1980 seeking opinion on whether or not the Provident Fund of that Office would remain exempt from income tax once it declares and distributes cash dividends to its members before they terminate their membership in accordance with the rules and regulations of the said Provident Fund. cdt In reply, please be informed as follows: 1. The tax exempt status under Section 56(b) of the Tax Code of 1977, as amended, of your Provident Fund, would not be destroyed and would remain if what would be distributed or divided among and shared and partaken by the members thereof is the cash income or earnings generated by the Fund from its investments. 2. The exemption from income tax of the Fund is lost if it had been formally organized into a stock corporation, and cash dividends were declared from the income it earns as a corporation. cd Very truly yours, RUBEN B. ANCHETA Acting Commissioner