The study provides brief information on the tax treatment of certain real property transactions for purposes of facilitating their registration with the Register of Deeds and the Assessor’s Office of local government units.
A final tax of six percent (6%) based on the gross selling price or current fair market value (zonal value) as determined by the Commissioner of Internal Revenue (CIR), whichever is higher, is imposed upon capital gains presumed to have been realized from the sale, exchange or other disposition of real property located in the Philippines.
Donation of a real property is subject to a donor’s tax at rates ranging from 2% to 15% of the net gifts made during the calendar year.
The estate tax is levied, assessed and collected upon the transfer of the net estate of every decedent, whether resident or nonresident of the Philippines, at rates ranging from 5% to 20%.
Section 196 of the NIRC likewise provides that on all conveyances, deeds, instruments or writings whereby any land, tenement or other realty sold shall be granted, assigned, transferred or otherwise conveyed to the purchaser, or purchasers, or to any person or persons designated by such purchaser or purchasers, a documentary stamp tax at the rate of fifteen pesos (P15.00) per one thousand pesos (P1,000.00) of the amount of consideration or on the zonal value of the said real property shall be collected.
