Cooperative Bank of Cotabato

November 29, 2021 CERTIFICATE OF TAX EXEMPTION NO. LTS-OT-434-2021 CERTIFICATE OF TAX EXEMPTION (For Cooperatives registered under Republic Act No. 9520) This is to certify that COOPERATIVE BANK OF COTABATO , a Cooperative, with address at Maharlika Highway, Lanao, Kidapawan City 9400 is a duly-registered taxpayer of RDO No. 127 under Tax Identification No. ________________ and is registered with the Cooperative Development Authority under Registration Certificate No. ______________ dated January 7, 2010. As a cooperative transacting with both members and non-members with accumulated reserves and undivided net savings of more than Ten million pesos (P10,000,000.00), COOPERATIVE BANK OF COTABATO is entitled to the following tax exemptions and incentives: 1. Exemption from payment of Annual Registration fee of Five Hundred pesos (P500.00); 2. Tax exemptions and incentives on its business transactions with members as provided by Article 61 of Republic Act No. 9520, as implemented by Section 8 of the Joint Rules and Regulations Implementing Articles 60, 61 and 144 of RA No. 9520: (a) Exemption from Income Tax on income from CDA-registered operations; (b) Exemption from Value-Added Tax on CDA-registered sales or transactions; (c) Exemption from other Percentage tax; (d) Exemption from Donor's tax on donations to duly accredited charitable research and educational institutions, and reinvestment to socio-economic projects within the area of operation of the cooperative; (e) Exemption from Excise tax for which it is directly liable; (f) Exemption from Documentary stamp tax: Provided, however, that the other party to be taxable document/transaction who is not exempt shall be the one directly liable for the tax; and (g) Exemption from all taxes on transactions with insurance companies and banks, including but not limited to 20% final tax on interest deposits and fifteen percent (15%) 1 final income tax on interest income derived from a depositary bank under the expanded foreign currency deposit system. Further, the abovementioned tax exemption/incentives shall only apply to the following activities and transactions of the cooperatives: 1. Cooperative Rural Banking. However, COOPERATIVE BANK OF COTABATO shall be liable for taxes on its business transactions with non-members as follows: 1. Income tax on the amount allocated for interest on capitals: Provided, That the same tax is not consequently imposed on interest individually received by members; 2. Value-Added Tax except for transactions exempt from the payment of value-added tax under Section 109 (1) (L), Section 109 (1) (M) and Section 109 (1) (N) of the Tax Code as amended by RA No. 9337; Provided, That the exempt transaction under Section 109 (1) (L) shall include sales made by cooperatives duly registered with the CDA organized and operated by its members to undertake the production and processing of raw materials or of goods produced by its members into finished or processed products for sale by the cooperative to its members and non-members: Provided, further, That any processed product or its derivative arising from the raw materials produced by its members, sold in the name and for the account of the cooperative, shall be deemed a product of the cooperative: Provided, finally, That at least twenty-five per centum (25%) of the net income of the cooperatives is returned to the members in the form of interest and/or patronage refunds; 3. Other percentage tax, except sales made by producers, marketing or service cooperatives; and 4. All other internal revenue taxes unless otherwise provided by law. This Certificate of Registration shall be valid for five (5) years from February 22, 2021 until February 21, 2026 unless sooner revoked by this Office for violation of any provisions of the Joint Revenue Regulations, the terms and conditions or upon withdrawal of the Certificate of Registration by the CDA. In Testimony Whereof, I have hereunto set my hand at Quezon City, Philippines this 29th day of November 2021. (SGD.) MANUEL V. MAPOY Assistant Commissioner Large Taxpayers Service ATTACHMENT TERMS AND CONDITIONS OF THIS CERTIFICATE OF TAX EXEMPTION 1. Any change or amendment in the charter or by-laws of the cooperative should be communicated immediately to the Revenue District Office where the cooperative is registered. 2. Any cooperative which violates any provision of the Joint Rules and Regulations Implementing Articles 60, 61 and 144 of RA 9520 and Revenue Memorandum Order No. 76-2010 may be disqualified either by suspension or cancellation of the right to avail of the exemptions granted under Article 61 of RA 9520, in addition to any administrative or criminal penalties provided for by laws or regulations. 3. Books of accounts and other accounting records of the cooperative and its actual operations for any taxable year (fiscal or calendar) shall be subject to annual verification by the Commissioner of Internal Revenue or his duly authorized representatives after previous authorization by Cooperative Development Authority (CDA). 4. All cooperatives are required to yearly submit to the appropriate Revenue District Office the following information or documents together with the filing of the cooperative's Annual Information Return (BIR Form 1702) due on or before the 15th day of the fourth month following the close of the calendar year: (1) Certified True Copy of the current and effective Certificate of Good Standing from CDA; (2) Original Copy of certificate under oath by the Chairperson/General Manager stating the following: (a) the type/category of cooperative and the principal activities/business transactions it is engaged in; (b) that the cooperative is transacting business with members only or both members and non-members, whichever is applicable; (c) the amount of the accumulated reserves as of the year end concerned; (d) the amount of net surplus for the year; and (e) that at least 25% of the net surplus is returned to the members in the form of interest on share capital and/or patronage refund; (3) Original Copy of yearly summary of records of transactions clearly showing which transactions correspond to members or in case the cooperative deals with members and non-members, yearly summary of records of transactions clearly showing which transactions correspond to members and non-members; (4) Original Copy of Certification under oath by the Chairperson/General Manager of the List of Members, their respective TINs, and the Share Capital Contribution of each member as of the year end concerned. Failure of the cooperatives to comply with the above requirements shall be a ground for cancellation/revocation of the Certificate of Tax Exemption. 5. The exemption of the cooperative shall not extend to its members subject to the exception provided in Section 11 of the Joint Rules and Regulations implementing RA No. 9520. 6. Notwithstanding the exemptions provided in this Certification, the cooperative shall be subject to all other taxes for which it is directly liable and not otherwise exempted by any law as stated pursuant to Sections 9 and 10 of the Joint Rules and Regulations implementing RA No. 9520. Footnotes 1. Republic Act No. [ILLEGIBLE PORTION] .