Question & AnswerQ&A (HLURB ADMINISTRATIVE ORDER NO. 12, S. 2000)
The purpose is to define the term "habitually engaged in real estate business" (HEREB) for purposes of implementing Revenue Regulations No. 2-98 and improving monitoring of realty transactions for tax collection.
A person or entity habitually engaged in real estate business is one who, as owner or developer, undertakes development and construction of subdivision/housing for sale to the general public as his/its regular source of income and complies with reporting requirements to HLURB.
The term HEREB determines eligibility for certain tax benefits such as lowered creditable withholding tax rates on sales of real property by developers who are considered habitually engaged in real estate business.
They must undertake development and construction of subdivision/housing for sale as a regular source of income and submit and update reportorial requirements to the HLURB in accordance with government rules and regulations.
It was approved by the Board of Commissioners on October 19, 2000.
Revenue Regulation No. 12-94 lowered the rates of creditable withholding tax on sales of real property by developers considered habitually engaged in real estate business.
For consistency and clarity in implementing the registration of HEREB and the issuance of certificates related thereto, as well as to improve tax collection monitoring.
Development and construction of subdivisions or housing projects intended for sale to the general public as a regular source of income.
The obligation to submit and regularly update reportorial requirements in accordance with existing government standards, rules, and regulations.