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Withholding Tax and Documentary Stamps Payments


Mrs. J will then request certified true copies of the TAX DECLARATION at the Municipal Assessor of Marilao and Provincial Assessor's Office of Bulacan as required by the BIR.

The DEED OF ABSOLUTE SALE should be notarized and Mrs. J pays the Withholding tax and the Documentary Stamps at the BIR- accredited banks before every 10th of the following month to avoid penalties imposed by the BIR.

Example:    If the Deed of Absolute Sale was notarized on May 15, 2003, the payments for the withholding tax and documentary stamps would be due on June 10, 2003.

If Mrs. J purchased a residential house and lot worth;

  1. Less than Php 500,000.00 - The BIR should be paid a 1.5% withholding tax based on the total purchased price, through the accredited bank. The withholding tax is usually paid by the developer or the seller, but in this case the total contract price for the house and lot does not include the withholding tax. Therefore, Mrs. J shouldered the withholding tax which was already included in the miscellaneous fee that she paid to the developer. The withholding tax has different tax rates.
    Withholding Tax Remittance Return
  2. The BIR should be paid a 1.5% of the total purchased price for the documentary stamps.
    Documentary Stamps Tax Declaration BIR Tax Payment Deposit Slip

    Proof of Payment
    with Bank Validation

The BIR has imposed the following tax rates for withholding tax on transactions involving real property:

  1. 0% - if registered with and certified by the HLURB or HUDDC as engaged in socialized housing projects pursuant to RA 7279 and its implementing regulations. The selling price of the house and lot or only the lot does not exceed Php180,000 in Metro Manila and other highly urbanized areas or Php150.000 in other areas or on the adjusted amount of selling price for Socialized Housing as may be determined later by the HLURB.

  2. 1.5% - not registered with HLURB as engaged in Socialized housing projects under 7279; the seller/transferor is habitually engaged in real estate business; the selling price is not over Php 500,000.00.

  3. 3.0% - not registered with HLURB as engaged in Socialized housing projects under 7279; the seller/transferor is habitually engaged in real estate business; the selling price is over Php500,000 but not over Php2,00,000.

  4. 5.0% - not registered with HLURB as engaged in Socialized housing projects under 7279; the seller/transferor is habitually engaged in real estate business; the selling price is over Php2.000.000.

  5. 7.5% - seller of transferor is not habitually engaged in real estate business.
  1. Transferring A Title To The Buyer's Name
  2. List of Documents Required
  3. Withholding Tax and Documentary Stamps Payments
  4. Application for BIR Certification
  5. Transfer Tax
  6. The Registry of Deeds

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