Real Property Tax Imposed upon real properties (land and improvements) by the City or Municipality Accrues every January 1 Real property tax constitute a lien on the property and is superior to any other lien, or encumbrance of any kind Determination of the RPT Determine property fair market value Determine the assessment level Determine assessed value Determine Real Property Tax Fair value and Assessment level Fair value based on Assessors value as indicated in the Tax Declaration Assessment level fixed by the Provincial/City/Municipal Council (Sanggunian) Subject to a maximum rate and varies per province/city/municipality Assessed value Computed as:
Fair value x Assessment Level
Assessment Level - land Residential 20% Agricultural 40% Commercial/Industrial and Mineral 50% Timberland 20% Special classes: Cultural, scientific 15% Hospital and water districts 10% Assessment level - Building Residential P175,000 or less 0% up to 60% for those more than P10M Agricultural 25% for P300,000 or less to 50% for those with more than P2M fair value Commercial/Industrial 30% for P300,000 or less to 80% for those with more than P10M fair value Timberland 45% for those with FMV of P300,000 or less to 70% for those with FMV of more than P2M Real Property Tax Computed as:
Assessed Value x Tax Rate
Maximum Real Property Tax Rates Cities and Municipalities within Metro Manila 2%
Provinces 1% Illustration You own a residence here in Bayombong with the following fair value per Tax Declaration: Land P1,000,000 House P2,500,000
The Municipal Sanggunian of Bayombong set
the maximum assessment level for land. The house has 40% assessment level.
Compute the Real Property Tax.
Deadlines For lump sum On or before January 31 (On some jurisdiction early payment is entitled to a discount of up to 20%) For installment due in four quarterly payments: March 31 June 30 September 30 December 31 Venue of Payment Treasurers Office of the LGU Penalties 2% interest per month on the unpaid amount until the tax is fully paid up to a maximum of 36 months Exempted Properties Public properties Religious, educational and Charitable entities Machineries and equipments actually, directly and exclusively used by local water districts and GOCCs engaged in the supply and distribution of water and or distribution and transmission of electric Real properties of registered coopperatives Machinery and equipment used for pollution control and environmental protection Levies on Real Properties Special Education Fund Tax uniform 1% rate with the same basis to the RPT Ad valorem Tax on idle lands 5% on same basis with RPT What is idle land? Agricultural land with more than 1 hectare land area of which remain uncultivated or unimproved Land other than agricultural with more than 1,000
sq.m., of which remain unutilized
Residential lots in subdivision Levies on Real Properties Special Levy lands within the territorial jurisdiction specially benefited by public works projects or improvements funded by the LGU concerned. Special levy shall not exceed 60% of the actual cost of such projects and improvements. Levies on Real Properties Social Housing Tax - A tax of of 1% of the value of all lands in urban areas in excess of P50,000. This may be imposed by a province, city, municipality within MMA. Levies on Real Properties Tax on Transfer of Real Property Ownership a tax on sale, donation, barter or any other mode of transferring ownership or title to real property. The rate is not more than 50% of 1% for provinces and 75% of 1% in the case of cities or municipalities in the MMA based on FMV or GSP w/e is higher. Exempt Disposal of real property pursuant to CARP OTHER LOCAL TAXES Provincial Taxes Municipal Taxes City Taxes Barangay Taxes Provincial Taxes Tax on business of printing and publication not to exceed 50% of 1% of gross receipts of prior year For newly started, not to exceed 1/20 of 1% of capital investment Tax on franchise not to exceed 50% of 1% of annual gross receipt. For newly started, not to exceed 1/20 of 1% of capital investment Provincial Taxes Tax on Gravel and Quarry Resources not exceeding 10% of the value in the locality per cubic meter of gravel or quarry resources extracted from public lands or waters within the territorial jurisdiction Provincial Tax Professional Tax tax on each person engaged in the exercise of his/her profession requiring government examination not exceeding P300 Amusement Tax - not exceeding 10% of admission fees of theaters, cinemas, concert halls, circuses, boxing stadia and others Annual fixed tax on delivery trucks or vans used in the deliveries of distilled spirits, liquors, soft drinks, cigars, cigarettes to outlets in the provinces - not exceeding P500/truck Municipal Tax graduated-fixed Business Tax graduated tax and fixed tax Manufacturers, assemblers, repakers, processors, brewers of liquors, distilled spirits and wines (with table table) Wholesalers, distributors or dealers in any article of commerce of whatever kind or nature (with tax table) Municipal Tax graduated-fixed Exporters and manufacturers, millers, producers, wholesalers, distributors, dealers or retailers of essential commodities Contractors and other independent contractors (with tax table) Municipal Tax Percentage tax Retailers - 2% for GR of P400,000 or less and 1% for GR of over P400,000 Bank and other financial institutions not exceeding 50% of 1% of gross receipts from lending activities, financial leasing, dividend, insurance premium and rent on property and profit from exchange or sale of property Municipal Tax Percentage tax Any business, not included in prior categories, to be taxed at a rate to be determined by the Sanggunian. If business is excisable or vatable, the rate shall not exceed 2% of the gross sales or receipt. Peddlers annual tax of P50/pedder City Taxes May impose those imposed by provinces or municipalities at a rate which exceeds the maximum rates by not more than 50%, except for the fixed tax on professional and amusement taxes. Note on Community Tax City and municipal governments may impose a Community Tax for: Individuals Basic of P5.0 + Additional of P1/P1K, maximum of P5K Corporations Basic of P500 + Additional of P2/P5K, maximum of P10K Exempt: Diplomats and consular representatives Transient visitors (stay not exceeding 3 months) Barangay Taxes Barangay may impose a tax of not more than 1% of gross sales or receipts on stores or retailers with fixed business establishments with Annual sales or receipts of P50,000 or less for cities Annual sales or receipts of P30,000 or less for municipalities Thank you!