Real Estate Seminar and Review

As a real estate broker, you basically have to consider two kinds of assets when determining taxes which have to be paid to the BIR:

1. Ordinary Assets (pay Creditable Withholding Tax)
2. Capital Assets (pay Capital Gains Tax, 6%)

Ordinary Assets are:

• Assets acquired by the bank
• Depreciated
• Stock in trade
• Used in business
• Normally subject to VAT

What about your residential house? If you can’t describe it using the list above, then it’s a Capital Asset.

To-do: Find the rates used in computing Creditable Withholding Tax (CWT).

Want to check if you’ve correctly memorized the different CWT rates applicable to realty developers as well as to banks and other institutions not habitually engaged in real estate?

» See Creditable Withholding Tax.

Tags: taxes

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