Tax Exemption Granted to SPCA (Society for the Prevention of Cruelty to Animals)

February 28, 1958 BIR RULING NO. 143-58 Dr. Basilia Zialcita Taningco c/o S.P.C.A. (Society for the Prevention of Cruelty to Animals) Manila M a d a m : This is with reference to your oral query on whether or not the SPCA (Society for the Prevention of Cruelty to Animals) is liable for the payment of any tax. You stated, in this connection, that the SPCA is a duly registered charitable association and that no part of its net income inures to the benefit of any member thereof. You also informed this Office that the SPCA has been leasing its lot, although you could not give any information as to the amount of annual rental received therefor. In answer thereto, I have the honor to inform you that, if as represented by you, the SPCA is an association organized and operated for charitable purposes and duly registered as such and that no part of its net income inures to the benefit of any member thereof, it is exempt from the payment of income tax on income other than those derived from any of its properties or from any activity conducted for profit, pursuant to Section 27(e) of the Tax Code which reads as follows: "SEC. 27 Exemptions from tax on corporations . 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 if its properties, real or personal, or from any activity conducted for profit, regardless, of the disposition made of such income, shall be liable to the tax imposed under this Code;" Accordingly, the income derived by the SPCA from the lease of its lot and/or from any other activity conducted for profit is subject to the income tax imposed by Section 24 of the Tax Code. Moreover, if the annual rental received by it amounts to P4,000.00 or more, it shall be liable to the payment of annual fixed tax (C-8) as a real estate dealer, the amount of which shall depend on the amount of annual rental received during the preceding year, as follows: Amount of Rental C-8 Fixed Tax P4,000 to P10,000 P 150.00 over P10,000 to P30,000 300.00 over P30,000 500.00 Very truly yours, (SGD.) JOSE ARAAS Commissioner of Internal Revenue