BIR Ruling [UN-175-94]

June 8, 1994 BIR RULING [UN-175-94] Ms. Leonisa Ocampo 1003 Solis, Tondo Manila M a d a m : This refers to your letter dated September 7, 1993 stating that you are already eighty (80) years old having been born on February 4, 1913 and retired last May 1992 as Registrar of De Ocampo Memorial College; that you are receiving P5,000.00 a month for a period of five (5) years, effective May 16, 1992 as pension from said school from which a withholding tax of P400.00 a month is being deducted by the school since June 1992. You now request that the same be exempted from income tax and consequently from the withholding tax and that the tax already withheld be refunded to you. In reply, please be informed that under R.A. No. 7432, which was approved on April 23, 1992, senior citizens shall be entitled to exemption from the payment of individual income tax; provided that their annual taxable income does not exceed the poverty level of P60,000.00 or such amount as may be determined by the National Economic and Development Authority (NEDA) for a certain taxable year. For purposes of said Act, the term "senior citizen" shall mean any resident citizen of the Philippines at least sixty (60) years old, including those who have retired from both government offices and private enterprises, and has an income of not more than sixty thousand pesos (P60,000.00) per annum subject to review by the National Economic and Development Authority (NEDA) every three years. (Sec. 2, R.A. 7432) In view thereof, and considering that you are already eighty (80) years old and your pension is only P60,000.00 annually, this office is of the opinion as it hereby holds that you are exempt from the payment of income tax on your pension of P60,000.00 per annum provided that you do not really have any income other than the said pension. Consequently the amount of P400.00 a month withheld from your income may be claimed as refund from the De Ocampo Memorial College if the said amount has not yet been remitted to the government. Otherwise, you may file your request for refund with the Chief, Appellate Division, this Bureau within two years from the date of payment of said tax withheld, pursuant to Section 204 of the Tax Code, as amended. cdt Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue