REVENUE MEMORANDUM ORDER NO. 20-2013 issued on July 22, 2013 prescribes the policies and guidelines in the issuance of Tax Exemption Rulings to qualified nonstock, non-profit corporations and associations under Section 30 of the National Internal Revenue Code (NIRC) of 1997, as amended Corporations and associations enumerated under Section 30 of the NIRC, as amended, including those which have been issued tax exemption rulings/certificates prior to June 30, 2012, shall file their respective Applications for Tax Exemption/Revalidation with the Revenue District Office (RDO) where they are registered. Only corporations or associations that are duly qualified under Section 30 of the NIRC, as amended, shall be issued Tax Exemption Rulings. A corporation or association shall submit the following documents: a. Original copy of application letter for issuance of Tax Exemption Ruling. The letter shall cite the particular paragraph of Section 30 of the NIRC, as amended, under which the application for exemption/revalidation is being based; b. Certified true copy of the latest Articles of Incorporation and By-Laws issued by the Securities and Exchange Commission; c. Original copy of Certification under Oath by an executive officer of the corporation or association as to: (i) all previous amendments/changes in the Articles of Incorporation and By-Laws, (ii) manner of activities, and (iii) the sources and disposition of income, if any, of the subject corporation or association. If there are no amendments/changes, the Certification shall state this fact; d. Certified true copy of the Certificate of Registration with the BIR; e. Original copy of the Certification under Oath by the Treasurer of the corporation or association as to the amount of income, compensation, salaries or any emoluments paid by the corporation or association to its trustees, officers and other executive officers. Provided, that, a corporation sole, which, by its nature, does not have trustees, corporate officers or executive officers need not submit the certification required under this subparagraph. f. Original copy of the Certification issued by the RDO where the corporation or association is registered that the corporation or association is not the subject of any pending investigation, on-going audit, pending tax assessment, administrative protest, claim for refund or issuance of tax credit certificate, collection proceedings, or a judicial appeal; or if there be any, the original copy of the Certification issued by the RDO on the status thereof; g. Certified true copies of the Income Tax Returns or Annual Information Returns and Financial Statements of the corporation or association for the last three (3) years; and h. Original copy of a statement under Oath by an executive officer of the corporation or association as to its modus operandi which shall include: i. A full description of the past, present and proposed activities of the corporation or association; ii. A narrative description of anticipated receipts and contemplated expenditures; and iii. A detailed description of all revenues which it seeks to be exempted from Income Tax. All other revenues which are not included in the statement/ application shall be subject to Income Tax. In addition to the said requirements, a non-stock and non-profit educational institution under Section 30(H) of the NIRC, as amended, shall submit the following documents: a. Certified true copy of government recognition/permit/accreditation to operate as an educational institution issued by the Commission on Higher Education (CHED), Department of Education (DepEd), or Technical Education and Skills Development Authority (TESDA); b. If the government recognition/permit/accreditation to operate as an education institution was issued more than five (5) years prior to the application for tax exemption/revalidation, an original copy of a current Certificate of Operation/Good Standing, or other equivalent document, issued by the appropriate government agency (i.e., CHED, DepEd, or TESDA) shall be submitted as proof that the non-stock and non-profit educational institution is currently operating as such; and c. Original copy of Certificate of utilization of annual revenues and assets by the Treasurer or his equivalent of the non-stock and non-profit educational institution. In accordance with the guidelines set forth in Section 1.3 of Department of Finance (DOF) Order No. 137-87, the Certificate shall provide a breakdown of the following: i. Any amount in cash or in kind (including administrative expenses) paid or utilized to accomplish one or more purposes for which the educational institution was created or organized, including grant of scholarship to deserving students and professorial chairs for the enhancement of professional course. ii. Any amount paid to acquire an asset used (or held for use) directly in carrying out one or more purposes for which it was created or organized, including the upgrading of existing facilities to support the conduct of the above activities. iii. Any amount in cash or in kind invested in an activity related to the educational purposes for which it was created or organized. iv. Any amount set aside for a specific project, which must be supported by a Board Resolution issued by the school administration on proposed projects (i.e., construction and/or improvement of school buildings and facilities, acquisition of equipment, books and the like) to be funded out of the money deposited in banks or placed in money markets, on or before the 15th day of the fourth month following the end of its taxable year. The general guidelines in the evaluation of the applications for tax exemptions/revalidation as well as the specific guidelines in the evaluation of the application of corporations or associations under Section 30(E) of the NIRC, as amended, are specified in the Order. A Tax Exemption Ruling issued under this Order shall be valid for a period of three (3) years from the date of effectivity specified in the Ruling, unless sooner revoked or cancelled. The Tax Exemption Ruling shall be deemed revoked if there are material changes in the character, purpose, or method of operation of the corporation or association which are inconsistent with the basis for its Income Tax exemption. The revocation takes effect as of the date of the material change. Tax Exemption Rulings may be renewed upon filing of a subseguent Application for Tax Exemption/Revalidation, under same requirements and procedures provided herein. Otherwise, the exemption shall be deemed revoked upon the expiration of the Tax Exemption Ruling. The new Tax Exemption Ruling shall be valid for another period of three (3) years, unless sooner revoked or cancelled. If a corporation or association, which has been issued a Tax Exemption Ruling, fails to file its annual information return, it shall automatically lose its income tax-exempt status beginning the taxable year for which it failed to file an annual information return, in addition to the sanctions imposed under Section 250 of the NIRC, as amended. Tax exemption rulings or certificates issued to corporations or associations listed under Section 30 of the NIRC, as amended, prior to June 30, 2012 shall be valid until December 31, 2013. Tax exemption rulings or certificates issued after June 30, 2012 shall continue to be valid for a period of three (3) years from date of issuance, unless sooner revoked or cancelled. .