REVERTING THE VENUE FOR THE FILING OF RETURNS AND PAYMENT OF CAPITAL GAINS TAX, CREDITABLE WITHHOLDING TAX AND DOCUMENTARY STAMP TAX DUE ON SALE, TRANSFER OR EXCHANGE OF REAL PR…
to Section 244 of the National Internal Revenue Code of 1997, as
amended, in relation to Sections 27(A), 27 (D)(5), 57 (A), 57 (B), 196
and 245 (j) thereof, these Regulations are hereby promulgated in order
to revert the venue for the filing of returns (i.e., capital gains tax
returns, creditable withholding tax returns, and documentary stamp tax
returns) and payment of taxes due on onerous transfers of real
properties owned by large taxpayers to the Authorized Agent Banks (AABs)
located within the Revenue District Office (RDO) having jurisdiction
over the place where the property being transferred is located.
SEC. 2. Policy Statement – Pursuant to the provisions of
Revenue Regulations No. 8-98, the venue for the filing of returns and
payment of taxes due on onerous transfers of real properties for all
taxpayers, including large taxpayers, is generally determined by the
place where the property being transferred is located.
Sometime last year, Revenue Regulations No. 4-2008, was promulgated effectively amending Revenue Regulations No. 8-98 but only in respect to
the venue for the filing of returns and payment of taxes of real estate
transactions of large taxpayers. This amendment was envisioned to
improve the efficiency in servicing the needs of the large taxpayers by
centralizing the processing of their real estate transactions in the
concerned Large Taxpayers Office where they are registered, thereby
doing away with the procedure of having to secure the Certificate
Authorizing Registration (CAR)/ Tax Clearance Certificate (TCL) from the
various RDOs where the respective real properties are located.
However, during the implementation and with the recent delisting and
enlisting of taxpayers who are to be classified as large taxpayers, it
has been recognized that such differing rule has caused confusion to
those who have been de-classified as large taxpayers, as well as those
who have be recently enlisted as such.
In order to provide uniformity in the processing of real estate
transactions of taxpayers, whether large or non-large taxpayers, and
that ocular inspection of the subject real property can be performed
expediently prior to the issuance of the CAR/TCL, the venue for the
filing of tax returns and payment of the taxes due thereon (i.e.,
CGT/CWT/Regular Income Tax/DST) on real properties owned by large
taxpayers, including securing of CAR/TCL, is hereby reverted to the
jurisdiction of the concerned RDO where the real property concerned is
located.
SEC. 3. Time and Place of Payment of Capital Gains Tax (CGT) and
Documentary Stamp Tax (DST) on the Sale, Exchange or Disposition of Real
Properties Classified as Capital Assets – Within thirty (30) days
following each sale, exchange or disposition of lands and/or buildings
which are not actually used in the business of a corporation and are
treated as capital assets, the Capital Gains Tax Return (BIR Form No.
1706) shall be filed by the seller or the buyer and payment of taxes
made to an AAB located within the RDO having jurisdiction over the place
where the property being transferred is located based on the gross
selling price or fair market value as determined in accordance with
Section 6 (E) of the Tax Code, whichever is higher, of such lands
and/or buildings.
The corresponding Documentary Stamp Tax Return (BIR Form No. 2000-OT)
shall be filed within five (5) days after the close of the month when
the taxable document was made, signed, accepted or transferred, and
the tax due thereon shall be paid at the same time the aforesaid return
is filed with the AAB having jurisdiction over the place where the
property being transferred is located based on the consideration
contracted to be paid for such realty or on its fair market value
determined in accordance with Section 6 (E) of the Tax Code, whichever
is higher.
The above rules apply whether the seller/transferor thereof is a large taxpayer or a non-large taxpayer.
These rules on the venue for the filing of the returns and payments
of taxes due on real properties onerously disposed shall likewise apply
in cases of taxable foreclosure sales.
SEC. 4 Time and Place of Payment of Creditable Withholding Tax
(CWT) and Documentary Stamp Tax (DST) on the Sale, Exchange or
Disposition of Real Properties Classified as Ordinary Assets –
Creditable withholding taxes (CWT) deducted and with held by the
withholding agent/buyer on the sale, transfer or exchange of real
property classified as ordinary asset, shall be paid by the withholding
agent/buyer upon filing of the CWT Return (BIR Form No. 1606) with the
AAB located within the RDO having jurisdiction over the place where the
property being transferred is located within ten (10) days following the
end of the month in which the transaction occurred subject, however,
to the specific rules prescribed by RR 2-98, as amended, and the rules
prescribed under the EFPS regulations, in case the taxpayer is an EFPS
taxpayer.
The corresponding Documentary Stamp Tax Return (BIR Form No. 2000-OT)
shall be filed within five (5) days after the close of the month when
the taxable document was made, signed, accepted or transferred, and
the tax due thereon shall be paid at the same time the aforesaid return
is filed with the AAB having jurisdiction over the place where the
property being transferred is located based on the consideration
contracted to be paid for such realty or on its fair market value
determined in accordance with Section 6(E) of the Tax Code, whichever is
higher.
The above rules apply whether the seller/transferor thereof is a large taxpayer or a non-large taxpayer.
These rules on the venue for the filing of the returns and payments
of taxes due on real properties onerously disposed shall likewise apply
in cases of taxable foreclosure sales.
SEC. 5 Issuance of Certificate Authorizing Registration (CAR)/ Tax Clearance Certificate (TCL) –
Upon presentation of the Capital Gains Tax Return or Creditable
Withholding Tax Return and Documentary Stamp Tax Return with a bank
validation evidencing full payment of the capital gains tax or the
expanded creditable withholding tax and documentary stamp tax due on
the sale, transfer, barter, exchange or other disposition of real
property classified as capital or ordinary asset, as the case may be,
the RDO of the revenue district office where the property being
transferred is located shall issue the corresponding Certificate
Authorizing Registration (CAR) or Tax Clearance Certificate (TCL) for
the registration of the real property in favor of the transferee.
In the case of sale or transfer of ordinary assets, it shall be the
responsibility of the RDO issuing the CAR/TCL to notify the RDO having
jurisdiction over the place of business of the seller to conduct an
immediate post-audit of the Quarterly Income Tax Return and the
Quarterly VAT Return of the seller to ensure that correct taxes (i.e.,
income tax, value added tax (if applicable), and documentary stamp tax)
have been fully paid on that sale of real properties considered as
ordinary assets of the company.
Furthermore, the Revenue Office in the RDO issuing the CAR/TCL shall
indicate on the reverse side of all the copies of the document of sale
or exchange or transfer the details of information indicated in the CAR,
to wit: CAR Number, Date of CAR, Title Number of the Property,
Classification of the Property, Location of the Property, Area of the
Property, Selling Price, Fair Market Value, Type of Taxes Paid (i.e.,
whether capital gains tax or expanded withholding tax, documentary stamp
tax, Amount of Taxes Paid, the Official Receipt Number/ Validation
Number and the Date of the Official Receipt/Date of Payment/Date of
Validation. Thus, before the CAR/TCL is released to the taxpayer, all
the copies of the document of sale/exchange or transfer shall first be
presented to the assigned revenue officers who shall indicate at the
back of said documents the information contained in the CAR/TCL as
herein required.
The CAR/TCL shall be signed by the Revenue District Officer of the
district having jurisdiction over the place where the property is
located. The CAR/TCL as issued by the RDO shall have a validity period
of one (1) year for purposes of presenting the same to the Register of
Deeds. In case of failure to present the same to the Register of Deeds
within the one-year validity period, the same may still be revalidated,
but the total period of validity cannot exceed two years counted from
the date of issuance of the CAR/TCL. Revalidation shall be done by
stamping the phrase “Revalidated on _____, to expire on _____”, after
validating the authenticity and validity of the old CAR/TCL sought to be
revalidated. Thus, given the periods set herein, the CAR/TCL, upon
issuance, shall have to be presented to the Register of Deeds within a
maximum period of not more than two (2) years; otherwise, the CAR/TCL
shall be deemed permanently expired and therefore of no effect. New
returns and proof of tax payments shall be needed to produce a new
CAR/TCL.
In no instance shall the Register of Deeds honor a CAR/TCL with erasures or alterations.
SEC. 6 Validity of Revenue Regulations No. 24-2002 – The
provisions of Revenue Regulations No. 24-2002 prescribing the
information to be periodically submitted by the Land Registration
Authority (LRA), the Register of Deeds and the Assessor’s Office to
the Bureau of Internal Revenue relative to the transfers of real
properties; the specific information that must be annotated, either by
the RDO or the Register of Deeds, to certain documents; and the manner
of issuance, recording and monitoring of the Certificate Authorizing
Registration (CAR), in order to ensure that all internal revenue taxes
due on transfers of real property have been paid and remitted to the
Government, as well as the responsibility of the Register of Deeds as
provided for in the said Regulations, shall all remain valid and effective.
SEC. 7 Transitory Provision – The following rules shall
apply with respect to real estate sale transactions of large taxpayers
prior to the effectivity of these Regulations:
The following rules shall apply with respect to real estate sale
transactions of large taxpayers prior to the effectivity of these
Regulations:
(1) For real estate sale transactions of large taxpayers on “
cash basis” or “deferred payment sale not on installment plan basis”
(i.e. payments in the year of sale exceed 25% of the selling price)
where the capital gains tax or expanded creditable withholding tax, as
well as documentary stamp tax returns have already been filed with and
taxes due thereon, if any, have already been paid to the concerned LTS
Office, the corresponding CAR/TCL shall remain to be processed and
issued by the said LTS Office even upon issuance of these Regulations;(2) For real estate sale transactions of large taxpayers on “installment basis, “ (i.e. payments in the year of sale do not exceed 25% of the selling price):
a. Where there is already full payment of the full consideration
of the real property bought under installment basis, and the
corresponding returns have already been filed and taxes due thereon, if
any, have already been fully paid to the concerned LTS Office, the
corresponding CAR/TCL shall remain to be processed and issued by the
said LTS Office even upon issuance of these Regulations;b. Where there is no full payment yet of the full consideration
of the real property bought under installment basis as of the effectivity of these Regulations, the remaining installment payment of
taxes due as of the effectivity hereof shall begin to accrue to the RDO
where the property is located, which shall be responsible for
processing and issuing the TCL/CAR.
Pertinent documents submitted as well as tax returns relative to
prior tax payments made to the concerned LTS Office shall then be
endorsed by said concerned LTS Office to the RDO where the property is
located, which shall consolidate the same with those filed with and
paid to its District Office for purposes of determining whether there
has been full payment of the taxes and due and full compliance with the
documentary requirements laid down by law and regulations prior to the
issuance of the CAR/TCL.
SEC. 8. Repealing Clause – All revenue rules and
regulations and parts thereof inconsistent with the provisions of these
Regulations are hereby amended, modified, or revoked accordingly.
SEC. 9. Effectivity Clause – These Regulations shall take effect fifteen (15) days after publication in any newspaper of general circulation.
Adopted: 16 March 2009
(SGD.) MARGARITO B. TEVES
Secretary of Finance
Recommending Approval:
(SGD.) SIXTO S. ESQUIVIAS IV
Commissioner of Internal Revenue