Comments on: Save Money On Taxes: Exemptions From VAT On The Sale And Lease Of Real Estate

By: Passive income through real estate investing – the path to financial freedom (Part 1) — Foreclosure Investing Philippines

Fri, 20 Jan 2012 07:15:50 +0000

[...] the lease of other properties not covered by the statement above. Please refer to this article: Save Money On Taxes: Exemptions From VAT On The Sale And Lease Of Real Estate for more information and a sample computation.Of course, income tax is still applicable. The good [...]

By: Aish

Aish — Wed, 26 Oct 2011 12:37:53 +0000

So is it safe to assume that if the real property is a capital asset that it is not subject to VAT whether or not it is owned by an individual or corporation? In other words, if you are subject to Capital Gains – then you are automatically not subject to VAT?

By: foodie

foodie — Tue, 06 Sep 2011 08:48:12 +0000

I would like to ask does the lessee have to pay 5% expanded witholding tax even if he is just renting a residential house ( no business) in a subdivision or is he exempted from paying that tax? And with regard to the the Lessor is he only liable to pay to pay the 3% percentage tax since his gross income does not exceed P 1.5 m for the year? What other taxes does the lessor have to pay for residential leasing. Thanks.

By: Dhez

Dhez — Fri, 19 Aug 2011 07:42:52 +0000

Hi… I want to clarify if the discount given to buyer shall not be considered as deduction to the basis (selling price or zonal valuation whichever is higher) of Expanded Withholding Tax? Thanks in advance and more power!

By: Ron Tomtom

Ron Tomtom — Tue, 17 May 2011 14:43:41 +0000

Jay,

I noticed that in your examples, you are treating each sale separately for VAT purposes. I would agree with the discussions assuming the seller is the owner of the property, and selling it as an isolated transaction and not as a business. Now, what if you are in the business precisely of buying and selling lot, house & lot, etc. on a regular basis, and that your gross receipts within the calendar year or within any 12 month period you have already breached the gross receipts threshold that now requires you to be a VAT registered person, at that point all your sales would then be subject to the 12% VAT already.

By: Nique

Nique — Thu, 13 Jan 2011 03:37:07 +0000

Hi Jay!

Very curious about your Vat exemption research.
May I know what your source is?

And do developers need a special permit or
certificate from the HLURB/HUDCC to be non-vat?

or are they automatically non-vat because of the
price below 2.5 million?

Thanks,

Nique

By: paolo

paolo — Sun, 02 Jan 2011 07:59:24 +0000

Is Rental of commercial space can be register under BMBE law that has below 3M Income?

By: Hanez

Hanez — Mon, 18 Oct 2010 03:44:26 +0000

Hi Jay, thanks for this very informative post. I just have a question for OFWs buying real property – are we exempted on VAT? thanks

By: Lilia

Lilia — Fri, 16 Jul 2010 04:52:04 +0000

Thanks so much to your wife for putting all these info together. I just would like to inquire if I my buyer agrees to buy my bank loaned lot property at P1.5M cash and shoulder the transfer/payments of the remaining 3 yrs amortization from the bank, is 12% VAT or 3% tax still applicable? Appreciate if you can enlighten me on this matter. Thanks!

By: Juan

Juan — Mon, 07 Jun 2010 07:05:34 +0000

Hi!

I have a problem. I purchased this vacant lot inside a subdivision in new manila from a sec-registered corporation. Currently, the seller and I are having a hard time ironing out certain things. I was informed that I had to assume the VAT and the capital gains taxes. I agreed to this.

However, upon close examination by my lawyer, he found out that the property is not subjected to VAT given that it is a capital asset. I then informed the buyer of this information.

He said that VAT will be paid because the property cannot be justified as a capital asset given that it is a vacant lot and the office is not even located there.

Can anyone please enlighten me with this? Thank you very much.