CAPITAL GAINS TAX (CGT): 6% of the selling price (SP) or the zonal value or the Fair Market Value of the property, whichever is higher.
DOCUMENTARY STAMP TAX (DST): 1.5% of the selling price (SP) or the zonal value or the Fair Market Value of the property, whichever is higher.
Where to find those amounts:
SELLING PRICE: The amount declared on Deed of Absolute Sale.
ZONAL VALUE: You either go to www.bir.gov.ph and click on ZONAL VALUES (which will then give you a list of zonal values based on location, and prompt you to download the file for it) or call/visit your nearest BIR office to get the information.
FAIR MARKET VALUE: The amount indicated on TAX Declaration.
To give you better view on how to calculate it, here's an example.
Let' say that the Selling Price of the property indicated in Deed of Absolute Sale is P3,000,000. The Zonal Value is P3,500,000. The Fair Market Value is P2,900,000.
Since the rule is "whichever is higher", on the example above the Zonal Value has the highest amount so that's where we will base our computation.
ZONAL VALUE of P,3,500,000 multiplied by 6% (CGT)= P210,000
ZONAL VALUE of P,3,500,000 multiplied by 1.5% (DST) = P52,500
The Total amount is: P262,500.
As an internal agreement, the buyer usually pays for DOCUMENTARY STAMP TAX (DST) and all other transfer costs while the seller pays for the CAPITAL GAINS TAX or (CGT) or they can create a different agreement as to who pays the taxes.
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