The Bureau of Internal Revenue (BIR) has caught wind of the booming real estate business in the Philippines and intends to require developers to give advanced payments of value added tax (VAT) on real estate assets. At the moment, real estate developers pay 12% VAT on properties on the 25th of the month after they are sold. The BIR, however, proposes that they pay a 3% VAT annually. If the developer receives a cash payment, the company should remit the 3% on or before the month after a sale, and the 12% on the 25th.
This new regulation will only cover real estate companies and will not cover one-time sales of personal property.
I was told by the condo developer that I have to pay the 100% of the VAT as soon as I have already made payments equal to 25% of the purchase price. I’m paying a monthly installment for 4 years. Is this is required under VAT rules? Appreciate clarification
Thanks
PJ