BIR Ruling No. 179-84

November 16, 1984 BIR RULING NO. 179-84 29-c-090-84-179-84 M a d a m : This refers to your letter dated October 22, 1984 requesting exemption from the withholding tax on retirement benefits which you will receive from the Philippine Trust Bank. Documentary evidence submitted show that due to your hearing defect which is now under treatment, you were advised by your physician to retire from the service as Asst. Cashier of Philtrust Bank. In reply thereto, I have the honor to inform you that pursuant to Section 29(c)(7)(B) of the Tax Code, as amended any amount received by an official or employee or by his heirs from the employer as a consequence of separation of such official or employee from the service of the employer due to death, sickness or other physical disability or for any cause beyond the control of the said official or employee is exempt from income tax. In view thereof, this Office is of the opinion as it hereby holds that any and all amounts you received from Philtrust Bank as a result of your separation from the service of the corporation due to your hearing defect which is a physical disability, are exempt from all taxes and consequently from withholding tax prescribed by Section 91, Chapter XI, Title II of the Tax Code, as amended by Batas Pambansa Blg. 135 and implemented by Revenue Regulations No. 6-82. It is however, understood that this tax exemption does not include payments for your salary and cash equivalent of your accumulated vacation and sick leaves, if any. Very truly yours, (SGD.) RUBEN B. ANCHETA Acting Commissioner