Application for Optional Retirement filed by Mrs. Erlinda L. Gutierrez

December 10, 1999 BIR RULING NO. 199-99 Sec. 5 R.A. 6638-00-000-199-99 Ms . Estelita V . Datu Chief, Personnel Division BIR, National Office BIR Road, Diliman, Quezon City M a d a m : This refers to your letter dated November 12, 1997 in connection with the application for optional retirement filed by MRS . ERLINDA L. GUTIERREZ . It is represented and your records show that Mrs. Erlinda L. Gutierrez retired from the Bureau under the provisions of Republic Act No. 6683 (Early Retirement) effective February 10, 1989; and that she was paid her separation pay in the amount of P27,644.03. Based on the foregoing, you now request for legal opinion on whether or not the application for optional retirement under Presidential Decree No. 1146, as amended by RA 8291, by Mrs. Gutierrez may be given due course. In reply, please be informed that Section 5 of R.A. 6683 provides, viz: SEC. 5. Exclusiveness of Benefits. An appointive official or employee who retires or elects to be separated from the service under this Act shall not be eligible for optional retirement with gratuity under Republic Act Nos. 1616 and 4968 or with pension under Commonwealth Act No. 186, as amended by Republic Act No. 660, or under Presidential Decree No . 1146 , as amended, or vice-versa. Accordingly, Mrs. Gutierrez' application for optional retirement under P.D. 1146, as amended, is without legal basis and therefore, cannot be given due course. However, Mrs. Gutierrez shall be entitled to the return of her GSIS personal contributions pertaining to her retirement only and the corresponding share of the government with interest earned pursuant to existing rules and regulations of GSIS in accordance with Section 4 of RA 6683. She shall likewise be entitled to the commutation of her unused vacation and sick leaves pursuant to the same provision. This shall include cash payment equivalent to eighteen (18) times her basic monthly pension and old-age pension benefit in accordance with Section 11, RA 8291 amending PD 1146, dividends as provided for in Section 2 5 of RA 8291; and premiums paid and interest earned on automatic life insurance and/or optional insurance under Section 24 and 26 of RA 8291. This is because where the benefits provided by RA 6683 for the same contingencies are less than the benefits provided under PD 1146, as amended by RA 8291, the GSIS shall pay only the difference (Section 55 of RA 8291). Moreover, the benefits paid by the GSIS shall be exempt from all taxes as provided by Section 39 of RA 8291. Very truly yours, (SGD.) BEETHOVEN L. RUALO Commissioner of Internal Revenue