Beginning October 15, 1984, Gross Rental Payment for Lease of Real Property Amounting to at least P500.00 is Subject to 5% Expanded Withholding Tax

November 12, 1991 BIR RULING NO. 245-91 50 (b) 303-88 245-91 Gentlemen : This refers to your letter dated June 18, 1991 requesting in behalf of your client, The Philippine Society For the Prevention of Cruelty To Animals, for a certification that rent income from its properties are not subject to withholding tax pursuant to Republic Act No. 1178 which allegedly took effect on June 19, 1954. In reply, please be informed that P.D. No. 1955 which took effect on October 15, 1984, withdrew all exemptions from or any preferential treatment in the payment of duties, taxes, fees, imposts and other charges heretofore granted to private business enterprises and/or persons engaged in any economic activity. Such being the case, beginning such date, gross rental payment for lease of real property amounting to at least P500.00 is subject to 5% expanded withholding tax under Section 1 (c) of Revenue Regulations No. 6-85 otherwise known as the Revised and Consolidated Expanded Withholding Tax Regulations implementing Section 50 (b) of the Tax Code, as amended. For this purpose, an individual payor of rentals is constituted as the withholding agent, with respect to payment made in connection with his trade or business. (Sec. 2, Revenue Regulations No. 6-85). Very truly yours, (SGD.) JOSE U. ONG Commissioner