Clarification of the Provisions of Sec. 334 (NIRC)

October 13, 1958 BIR RULING NO. 555-58 B. W. Vetter & Company Certified Public Accountants 914 Daniel Building Tulsa, Oklahoma Attention : Mr . James L . Dumolt Gentlemen : Reference is made to your letter dated July 16, 1958 wherein you requested clarification of the provisions of Section 334 of the National Internal Revenue Code of this country in connection with the question of whether or not your client's (a U.S. Corporation) branch office in the Philippines is required to keep the books of accounts prescribed in the aforesaid section of the said Code. In reply thereto, I have the honor to inform you as follows: Since your client is doing business here and is also maintaining a branch office in this country, its total net income derived from all sources within the Philippines is subject to Philippine income tax pursuant to Section 24 of the National Internal Revenue Code. Being subject to the said tax which is an internal revenue tax, your client is, therefore, covered by the provisions of Section 334 of the aforesaid Code in so far as transactions within this jurisdiction are concerned. However, inasmuch as the principal office of your client cannot be reached by our laws, said Office being in the United States, perforce, our jurisdiction over your client will be exercised only thru its branch office here which is in fact an extension of its personality. Consequently, the aforesaid branch office must keep the books of accounts, i.e., the journal and the ledger, required by Section 334 of the Tax Code. cdt Very truly yours, (SGD.) MELECIO R. DOMINGO Acting Commissioner of Internal Revenue