Practice question
A nonstock nonprofit association regularly sells taxable goods in an economic activity. It claims nonprofit form alone automatically removes section 105. Which is correct?
- The statutory trade-or-business definition includes the stated nonprofit organizations regardless of disposition of net income
- All nonprofit sales are automatically outside VAT
- Only corporations with dividends can conduct economic activity
- Member-only sales are always exempt without any law
- Only the association’s name matters
Legal references
- https://lawphil.net/statutes/repacts/ra1997/ra_8424_1997.html — NIRC, section 105
- https://lawphil.net/statutes/repacts/ra2024/ra_11976_2024.html — RA 11976 amendments to NIRC sections 106 and 108
- https://lawphil.net/statutes/repacts/ra2024/ra_12023_2024.html — RA 12023 amendments to sections 105 and 108 and new section 108-A
- https://bir-cdn.bir.gov.ph/BIR/pdf/RR%2014-2025.pdf — BIR RR 14-2025, digital-service VAT transition
Answer this question in flashcards to review your response and continue practicing.