BIR Property Tax

[mangoesandkisses]

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BIR tightens rules on property deals Tax managers say new ruling ‘unjust and unfair’ | Business, News, The Philippine Star | philstar.com



MANILA, Philippines - Property buyers and sellers could be subjected to a tax probe to determine their financial capacity under a new memorandum issued by the Bureau of Internal Revenue (BIR).


Issued less than a month before the new administration takes over, Revenue Memorandum Order 24-2016 is intended “to ensure the tax compliance of the parties” involved in property sale and transfer.


“Parties to the said transactions may be subjected to an audit or investigation to determine their capacity to hold and/or acquire properties,” the order dated June 7 stated.


The order covers transactions involving the payment of capital gains tax on both property and non-traded stocks, donor’s tax, estate tax, expanded withholding tax, and those covered by tax-free arrangements under the law.

Internal Revenue commissioner Kim Henares has not replied to request for comment as of press time.


Benedict Tugonon, president of tax industry group Tax Management Association of the Philippines (TMAP), said the new order is “unjust and unfair” to taxpayers.


“Henares should refrain from issuing issuances now at this point in time, as a courtesy to the new administration,” Tugonon said in a phone interview.


“We will strongly recommend to the next administration to include (this) among the issuances that should be withdrawn or cancelled,” he added.


According to the order, application for certificate authorizing registration and tax clearance for property sale and transfer may be evaluated for “possible” audit.


If a buyer is found to not have the financial capacity to acquire the said property, a letter of authority may be issued by the concerned BIR revenue district office where the application was filed.


A letter of authority is issued to taxpayers being investigated or audited. While such issuance may not stop the actual sale, Tugonon said it gives taxmen too much discretion.


“This presumes taxpayers committed fraud. We all enjoy the legal presumption of good faith. Fraud cannot be justified by mere speculation,” he said.


“BIR examiners (are) given wide latitude of discretion as to what constitute necessary documents to be submitted to determine capacity to acquire,” the TMAP official added.


Specifically, Tugonon said it will be “inconvenient” for those without not required to file income tax returns (ITR) to prove financial capacity.


Under the memorandum, an affidavit will be required from the likes of minimum wage earners and even overseas Filipino workers stating their annual income, source of income and why they are buying the property.


“The (order) also covers estate tax. How can the BIR investigate the financial capacity of the deceased when the owner is already dead?” Tugonon said.

[rickflag]

Ngita na pod silag paagi makakuarta. Daku naman gani daan ang tax rate sa inheritance tax daan.

[The_Stoic]

"The squeaky wheel gets the grease".

Basaha usa ninyo ang regulation, usa mo comment. Naa man gud nay limitation, dili mana tanang transactions.

[hobie]

Para nako nindot kau na, kay diri sa amo lugar daghan kau gipang dummy bitaw, wherein the rich people and foreigners nag evade sa tax na supposedly sila ang mag bayad, and foreigners who supposedly are not allowed to own real estate properties other than a condominium.

[The_Stoic]

Scenario:

A certain Mr. A bought a property worth 5M, when we check the records, Mr. A is neither a businessman nor professional. Where did he get the money to buy the property? Illegal business? Drug dealing? Probably?

This is one of the ways to go after those persons with undisclosed business without paying a single cent of tax. Basin naa moy kaila diha.

[cardo]

expect decline in property sales unless e void ning digong when he takes over, hirit pag gyud dali2x mga amaw

[The_Stoic]

Newsflash: Gi revoke na ni Commissioner Dulay

[rickflag]

Scenario:

A certain Mr. A bought a property worth 5M, when we check the records, Mr. A is neither a businessman nor professional. Where did he get the money to buy the property? Illegal business? Drug dealing? Probably?

This is one of the ways to go after those persons with undisclosed business without paying a single cent of tax. Basin naa moy kaila diha.

Kinsa may tao nga ganahan utingkayon sa BIR? Bisan sa US di sila ganahan ma utingkay sa IRS. Ang govt mangita jud nag rason maka collecta ug tax nimu bisan pag wala mokita imo negosyo.

[wire]

ask ko about aning atong property taxes - "Kanus-a ta officailly jud magsugod mobayad sa ato Real Property Tax (RPT)?" "Asa sad nato ma verifiy ato unit na naka pangalan officially jud sa ato-a?"