What the Calculator Adds Up
When you sell land, a house and lot or a condo unit that you do not use in a business (a "capital asset"), four government charges come with the sale:
- Capital gains tax. 6% under Section 24(D) of the National Internal Revenue Code (NIRC). It is a one-time tax on the seller (a final tax), computed on the selling price, the BIR zonal value or the assessor's fair market value, whichever is highest. It applies even if you sold at a loss.
- Documentary stamp tax (DST). ₱15 for every ₱1,000 or part of ₱1,000 (about 1.5%) under NIRC Section 196, on the same base as the capital gains tax.
- Local transfer tax. Up to 0.5% of the price or the fair market value, whichever is higher, in a province, and up to 0.75% in a city or a Metro Manila town (Local Government Code, Sections 135, 144 and 151). The local ordinance sets the actual rate, and some treasurers use the zonal value as well.
- Registration fee. The Registry of Deeds charges it to cancel the old title and issue a new one in the buyer's name. The amount follows the Land Registration Authority (LRA) table of fees, so ask the Registry of Deeds for the figure.
On top of these come the notary's fee for the Deed of Sale, and smaller charges such as Certified True Copies of the title and Tax Declaration, and the assessor's fee for a new Tax Declaration.
Who Pays: The Law, and the Common Arrangement
The legal default leans on the seller. The capital gains tax is a tax on the seller's income. The Local Government Code (Section 135) puts the duty to pay the transfer tax on the seller, and the Civil Code (Article 1487) makes the seller bear the costs of signing and registering the sale, unless the parties agree otherwise. The documentary stamp tax can be collected from any party to the deed (NIRC Section 173).
Buyers and sellers often agree to a different split. A common arrangement is:
| Charge | Often Agreed to Be Paid By |
|---|---|
| Capital gains tax | Seller |
| Documentary stamp tax | Buyer |
| Local transfer tax | Buyer |
| Registration fee | Buyer |
| Notary's fee | Shared, or the buyer |
None of this is fixed. Whatever you agree, write it in the Deed of Sale; without a clear agreement, the seller's legal duties apply.
Deadlines
- Capital gains tax: file and pay within 30 days of the notarization of the deed (BIR Form 1706).
- Documentary stamp tax: within 5 days after the end of the month the deed was notarized (BIR Form 2000-OT).
- Transfer tax: within 60 days of the date the deed was signed (Local Government Code, Section 135).
Late payment brings surcharges and interest. The BIR issues its go-signal for the transfer, the electronic Certificate Authorizing Registration (eCAR), once the taxes are paid and the papers are complete, and the Registry of Deeds needs the eCAR and the transfer tax receipt before it issues the new title.
Zonal Values Are Changing
The Real Property Valuation and Assessment Reform Act, Republic Act No. 12001 (RA 12001), signed on 13 June 2024, replaces BIR zonal values with a single list of market values for each city or province (the schedule of market values, or SMV). Once an SMV takes effect, the BIR uses it or the price, whichever is higher. Until then, the zonal value stays in force. If your city or province already has an approved SMV, enter that value in the zonal value box.
Common Questions
How Much Is the Capital Gains Tax on the Sale of a House and Lot?
6% of the selling price, the BIR zonal value or the fair market value in the Tax Declaration, whichever is highest. A sale of ₱3,000,000 with a zonal value of ₱3,500,000 is taxed on ₱3,500,000, so the tax is ₱210,000.
Can We Put a Lower Price in the Deed to Pay Less Tax?
It does not lower the capital gains tax or the DST below the zonal value or Tax Declaration value, because the BIR uses whichever is highest. Stating a false price in a notarized deed can also expose both parties to penalties.
Is the Sale of My Home Exempt?
The NIRC exempts the sale of a principal residence if the whole proceeds are used to buy or build a new principal residence within 18 months, with conditions and only once every 10 years. You still file the return, and the tax is held aside (in escrow) until you show the new purchase. Ask your BIR revenue district office about the requirements.
Why Does the Calculator Not Show the Registration Fee?
The Registry of Deeds computes it from the LRA's table of fees, which has its own brackets and add-on charges. Rather than print a figure that may be out of date, the calculator leaves it for the Registry of Deeds to tell you.
Not legal advice. This is general information. For advice on your own situation, consult a lawyer. If you cannot afford one, the Public Attorney's Office (PAO) or an IBP legal aid office may help for free.
This is an estimate to help you plan. The BIR, the city or municipal treasurer or the Registry of Deeds works out what you actually pay. Government fees, rules and requirements change, so always check with the office concerned before you go.