RMO No. 22-2025: Amending the Guidelines in the Processing and Issuance of Certificate of Tax Exemption under Revenue Memorandum Order No. 38-2019 Entitled as “Tax Exemption of Non-Stock, Non-Profit Corporations Under Section 30 of the National Internal Revenue Code of 1997, as Amended”

Summary

RMO No. 22-2025 amends RMO No. 38-2019 (Tax Exemption of Non-Stock, Non-Profit Corporations Under Section 30 of the NIRC) by adding rules on tax exemption of legitimate labor organizations of seafarers under RA No. 12021.

Key points

1. Scope of exemption. The income and properties of a legitimate labor organization of seafarers, including grants, gifts, donations and contributions actually, directly and exclusively used for lawful purposes, are free from taxes, duties and other assessments. Only a special law expressly repealing Section 8 (second paragraph) of RA No. 12021 may withdraw this.
2. Limits that still apply. The limitations in the Order on income tax exemption, obligations as withholding agents, and liability for VAT or percentage tax still apply.
3. No CTE application. These organizations register with the RDO of their principal place of business and need not apply for a Certificate of Tax Exemption, but submit documents at registration. These include a certified true copy of the SEC Articles of Incorporation and By-Laws with required provisions and a sworn certification from an executive officer on activities and income.
4. DOLE certification. They submit a certified true copy of the DOLE certification that they are in the register of legitimate labor organizations within sixty (60) days from effectivity of the IRR of RA No. 12021. An updated copy is attached to each Annual Income Tax Return.
5. Reporting duties. An organization must inform the BIR through its RDO of cancellation of its DOLE registration or non-inclusion in the list, and non-compliance carries penalties. Availment is without prejudice to post-audit.
6. Reports to the National Office. Regional Directors submit a Quarterly Summary Report of CTEs issued to Section 30 corporations on or before the 20th day of the month after each quarter. RDOs keep an inventory of labor organizations availing of RA No. 12021 incentives and submit it annually, not later than the 30th of January.

Who is affected

• Legitimate labor organizations of seafarers
• Regional Directors and Revenue District Offices

Deadlines and effectivity

• DOLE certification: within sixty (60) days from effectivity of the IRR of RA No. 12021
• Quarterly report: on or before the 20th day after each quarter
• Annual inventory: not later than January 30
• Issued April 30, 2025

Summary by Tax Resources PH. It is not a substitute for the full text of the issuance or professional advice.