BIR Ruling No. 120-61

April 10, 1961 BIR RULING NO. 120-61 The Children's Memorial Foundation (Phil.) Inc. Banawe Street, Quezon City Gentlemen : This is in connection with your request for reconsideration of our ruling denying your request for exemption from payment of income tax under the provisions of Section 27(e) of the National Internal Revenue Code which reads as follows: "Sec. 27 Exemption from tax on corporation . The following organizations shall not be taxed under this title in respect to income received by them as such xxx xxx xxx "(e) Corporation or association organized and operated exclusively for religious, charitable, scientific, athletic, cultural, or educational purposes, or for the rehabilitation of veterans, no part of the net income of which inures to the benefit of any private stockholder or individual; Provided, however, That the income of whatever kind and character from any activity conducted for profit, regardless of the disposition made of such income, shall be liable to the tax imposed under this Code." To be exempt under the abovequoted provision of the Tax Code, a corporation must satisfy two conditions, to wit: (1) it must be organized exclusively for religious, charitable, scientific, athletic, cultural or educational purposes and (2) no part of the net income of the corporation shall inure to the benefit of any private stockholder or individual. cdpr According to the report of our agent who reinvestigation this case, you are a non-stock, non-profit organization, established principally to maintain a foundation dedicated to the protection, care, and advancement of the health, treatment and cure of diseases or disabilities of children of the Philippines, Southeast Asia and the rest of the world. It was also ascertained that in the event of dissolution of the corporation, the remaining assets and surplus will be transferred to the Government. In view of the foregoing, this Office is of the opinion that you are exempt from payment of income tax under the provisions of Section 27(e) of the Tax Code. You are not however, exempt from filing your income tax return inasmuch as your income of whatever kind and character from any of your properties, real or personal or from any activity conducted for profit, regardless of the disposition made of such income, is subject to tax. prcd Very truly yours, (SGD.) MELECIO R. DOMINGO Commissioner of Internal Revenue