Private Educational Institutions Subject to Income Tax

April 23, 1984 BIR RULING NO. 072-84 24-a-000-00-072-84 Gentlemen : In reply to your letter dated August 5, 1982, I have the honor to inform you that under Section 24(a) of the National Internal Revenue Code, as amended, private educational institutions, whether stock or non-stock, shall pay a tax of ten percent of their taxable net income from the operation of the school, related school activities, and on their passive investment income consisting of interests, dividends, royalties and the like. Moreover, in addition to all ordinary and necessary expenses, private educational institution whether stock or non-stock shall also be allowed to deduct during the taxable year when they incurred expenses for the expansion of school facilities pursuant to Section 30(a)(3) of the Tax Code. In other words, this Office cannot grant you a certificate of tax exemption, on the ground that, as a private educational institution, you are subject to income tax. cdta Very truly yours, (SGD.) RUBEN B. ANCHETA Acting Commissioner