Bread of Life Christian Fellowship Center of Kabacan Cotabato, Inc.

September 28, 2009 BIR RULING [NSNP-(S30E-128) 629-09] 30 (E); S-30-030-2003 Bread of Life Christian Fellowship Center of Kabacan Cotabato, Inc. Osias, Kabacan, Cotabato Attention: Mr. Florencio Q. Corpuz Bookkeeper Gentlemen : This refers to your letter dated December 18, 2008 requesting for exemption from the payment of income tax under Sec. 30 of the Tax Code of 1997. Documents submitted to this Office show that Bread of Life Christian Fellowship Center of Kabacan Cotabato, Inc. with TIN 268-167-888 is a non-stock, non-profit association duly registered with the Securities and Exchange Commission (SEC) under SEC Registration No. CN200830511 dated August 14, 2008; and that the purpose for which the corporation was formed is for the administration of its affairs, properties and temporalities. In reply, please be informed that this Office cannot as yet issue the requested ruling/certificate of tax exemption. The Bread of Life Christian Fellowship Center of Kabacan Cotabato, Inc. has to prove by actual operation for at least three (3) years that it is really an organization/association exempt from income tax under Section 30 of the Tax Code of 1997. It must file the necessary annual information return instead of an income tax return on or before the 15th day of the fourth month of the year following the start of its operation as an exempt organization as required under Section 24 of Revenue Regulations No. 2 ( Collector vs. Sinco , G.R. L-9276 dated October 23, 1956). Based on such information return, the Bureau of Internal Revenue thru the concerned Revenue District Office which has jurisdiction over the place of business of the subject taxpayer shall conduct the necessary investigation on corporation's activities undertaken during the period. The determination letter of exemption shall thereafter be issued depending upon the result of our investigation. IcTaAH However, Bread of Life Christian Fellowship Center of Kabacan Cotabato, Inc. shall be subject to the corresponding internal revenue taxes imposed under the Tax Code of 1997 on income derived from any of its properties, real or personal, or any activity conducted for profit regardless of the disposition thereof, which income should be returned for taxation. Likewise, interest income from currency bank deposits and yield or any other monetary benefit from deposit substitute instruments and from trust funds and similar arrangements, and royalties derived from sources within the Philippines are subject to the 20% final withholding tax: provided, however, that the interest income you derive from a depository bank under the expanded foreign currency deposit system shall be subject to a final withholding tax of 7 1/2% pursuant to Section 27 (D) (1) in relation to Section 57 (A) of the Tax Code of 1997. Moreover, it is required to file on or before the 15th day of the fourth month following the end of the accounting period a Profit and Loss Statement and Balance Sheet with Annual Information Return under oath, stating the corporation's gross income and expenses incurred during the preceding period and a certificate showing that there has not been any change in your By-Laws, Articles of Incorporation, manner of operation and activities as well as sources and disposition of income. It should be understood that Bread of Life Christian Fellowship Center of Kabacan Cotabato, Inc., shall be constituted as a withholding agent for the government if it acts as an employer and any of its employees receives compensation income subject to withholding tax, or if it makes income payments to individuals or corporations subject to the withholding tax provided for in Section 57 of the Tax Code of 1997. (BIR Ruling No. S-30-030-2003 dated November 28, 2003) Finally, its books of accounts and other pertinent records shall be subject to periodic examination by revenue enforcement officers of this Bureau for the purpose of ascertaining whether it is compliant with the conditions under which it may be granted tax exemption or tax incentives and/or it pays its tax liability, if any, pursuant to Section 235 of the Tax Code of 1997. (BIR Ruling No. ECCP-23-2000 dated May 12, 2000) This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation it will be ascertained that the facts are different, then this ruling shall be considered as null and void. TSIEAD Very truly yours, Commissioner of Internal Revenue By: (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service