Unformatted text preview: alizing profit, was subject to
VAT on services rendered. In fact, even if such corporation was organized without any
intention of realizing profit, any income or profit generated by the entity in the conduct of
its activities was subject to income tax.
Hence, it is immaterial whether the primary purpose of a corporation
indicates that it receives payments for services rendered to its affiliates on a
reimbursement-on-cost basis only, without realizing profit, for purposes of determining
liability for VAT on services rendered. As long as the entity provides service for a fee,
remuneration or consideration, then the service rendered is subject to VAT.” Accordingly, the gross receipts of condominium corporations including association dues,
membership fees, and other assessments/charges are subject to VAT, income tax and income
payments made to it are subject to applicable withholding taxes under existing regulations.
All concerned revenue officials and employees are hereby enjoined to give this Circular
as wide a publicity as possible.
This Circular takes effect immediately.
KIM S. JACINTO-HENARES
Commissioner of Internal Revenue
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- Spring '14
- association dues, CONDOMINIUM CORPORATION, Condominium Corporations