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Revenue Memorandum Circular No. 76-2003 dated Nov. 14, 2003

Revenue Memorandum Circular No. 76-2003 dated Nov. 14, 2003. Tax Exemption of Non-Stock, Non-Profit Corporations and Non-Stock Non-Profit Educational Institution. Non-stock, non-profit corp. Organization enumerated under Sec. 30 of the Code are exempt from payment of income tax, exempt:

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Revenue Memorandum Circular No. 76-2003 dated Nov. 14, 2003

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  1. Revenue Memorandum Circular No. 76-2003 dated Nov. 14, 2003 Tax Exemption of Non-Stock, Non-Profit Corporations and Non-Stock Non-Profit Educational Institution

  2. Non-stock, non-profit corp. • Organization enumerated under Sec. 30 of the Code are exempt from payment of income tax, exempt: • income derived from personal or real properties or any activity conducted for profit (ex. Rental) • interest income from currency bank deposit (20%)

  3. Non-stock, non-profit corp. • Except (continuation) • royalties from sources within the Phils. • deposits under EFCDS - 7.5% • Withholding tax on wages • Expanded withholding tax

  4. Non-stock, non-profit corp. • The exemption does not cover withholding taxes; • It is mandatory that they should maintain books of accounts; • Required to pay P500 Reg. Fee (Sec. 235 of the Code) • Required to issue receipts/commercial invoices

  5. Non-Stock, Non-Profit Educational Institution • Their exemption refers to internal revenue taxes imposed by the National Gov’t. on all revenues and assets used actually, directly and exclusively for educational purposes.

  6. Non-Stock, Non-Profit Educational Institution • Cafeterias/canteens and bookstores are exempt from taxation provided they are owned and operated by the educational institution as ancillary activities and the same are located within the school premises.

  7. Non-Stock, Non-Profit Educational Institution • They are exempt from VAT provided they are accredited as such either by DECS or by CHED. This exemption does not extend to their other activities involving sale of goods and services.

  8. Non-Stock, Non-Profit Educational Institution • However, they shall be subject to internal revenue taxes on income from trade, business or other activity, the conduct of which is not related to the exercise or performance of their educational purposes or functions.

  9. Non-Stock, Non-Profit Educational Institution • Exempt from the 20% and 7.5% (FCDS) withholding tax on bank deposits but subject to compliance of certain conditions • Filing on Annual Information Return together with the duly audited financial statements

  10. Non-Stock, Non-Profit Educational Institution • Attachments to Annual Information Return: • Certification from their depository banks as to the amount of interest income earned; • Certification of actual utilization of the said income; • Board Resolution on proposed project to be funded out of the money deposited in banks/money markets on or before the 14th day of the 4th month following the end of its taxable year.

  11. Non-Stock, Non-Profit Educational Institution • The exemption does not cover withholding taxes; • It is mandatory that they should maintain books of accounts; • Required to pay P500 Reg. Fee (Sec. 235 of the Code) • Required to issue receipts/commercial invoices

  12. “Taxation is the Foundation in Nation Building: Give Your Just Share”

  13. the end

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