Question & AnswerQ&A (BIR REGULATIONS NO. 8-98)
A final tax rate of six percent (6%) is imposed on capital gains presumed to have been realized by the seller, based on the gross selling price or fair market value, whichever is higher.
The Capital Gains Tax Return must be filed and payment made within thirty (30) days following each sale or disposition.
Payment and filing must be made at an Authorized Agent Bank (AAB) located within the Revenue District Office (RDO) having jurisdiction over where the property is located.
They may choose to be taxed either under the normal income tax rate in Section 24(A) or pay the final capital gains tax of six percent (6%) under Section 24(D)(1) of the Tax Code.
The withholding tax rate is 5.0% of the gross selling price or fair market value, whichever is higher.
A creditable withholding tax rate of 7.5% is imposed on the gross selling price or fair market value, whichever is higher.
The withholding agent/buyer is responsible for deducting, withholding, and paying the creditable withholding tax.
Creditable withholding taxes must be paid within ten (10) days following the end of the month when the transaction occurred, except taxes withheld in December, which must be filed on or before January 25 of the following year.
It amends pertinent portions of Revenue Regulations Nos. 11-96 and 2-98 and repeals or modifies any inconsistent revenue regulations, memorandum orders, or circulars.
It took effect fifteen (15) days after publication in any newspaper of general circulation.