Land and Building Tax in Philippines

Once you have a building on your land you will be paying Real Property Tax with Improvement and that is your building;

Thanks for that, do you have idea how that works?

I have been talking to many people here in province and they all said they have never paid for Building only land, and when I told them they are asking me to pay, they said to ignore them, and no need to pay for building, i am kind of confused in what to do or what is the truth.

Actually, when your building is new, the tax assessor will come knocking at your door.  That is what happened to me.

The issue really is not that you do not want to pay but will they assess you correctly/fairly?

What province your land is situated?  Your land how is it classified? Agricultural/Residential/Commercial?

A land owner has to pay taxes on his property and structures in it or "improvements". If there are no buildings on that land, you should present a certificate of no improvement so you don't have to pay taxes for improvements.

When you build a house, you apply for a building permit. One of the items in the application is a bill of materials and labor, i.e. the cost of building the house. This will be one of the bases in assessing the value of your improvement (often undervalued by the applicant to lower taxes).

I believe you have to submit an occupancy permit to live in your newly-built house. Next time you pay taxes, you should not present a certificate of no improvement. The value of your house will be assessed. You will need to pay taxes for both the house and land.

You might have to pay penalties if you do not state that you had improvements on the land.

Hi guys thanks for all of this, my house is Residential Zoned, but all this go little bit back, when I got Contractor to Build my house, he did have Building permit, so he said, then when it was finished we ask for occupancy permit, we did not get it, by then we had few problems with house, ask him to come back and fix it but he never did, we are in court presiding's as from now, when we went to see Engineering department in City hall, they said we have no records of building a house, so no permits at all, but one Woman that works there as an Engineer in Building department she is the boss there,  along with her Husband they fixed the papers so it looks we have permit and occupancy too, this I believe are fixes in their own jobs.

samangelevski wrote:

Hi I am very interested to know how every one is paying Tax on Land or on Building or both. . . .
so I like to know what you guys pay and how you do it??

I have my assistant go to Tax Assessor's Office at Quezon City Hall before March 31 of each year to pay in full real property taxes for my house and lot in Quezon City. (Quezon City gives a 20% discount to those who pay taxes in full on or before March 31 of the current year.) I have her bring last year's tax receipt and a notarized authorization letter stating that I am authorizing her to make payments on my behalf.

Unless there's an increase in zonal valuation for my property, taxes for this year would be the same as last year's. I have my assistant bring the amount paid last year in cash plus an extra amount to cover increases in zonal valuation, if any.   

I keep the receipts. We go through the same routine each year. We try to pay before the end of February to avoid long queues.

samangelevski wrote:

I have been talking to many people here in province and they all said they have never paid for Building only land, and when I told them they are asking me to pay, they said to ignore them, and no need to pay for building, i am kind of confused in what to do or what is the truth.

There is a saying here: "Something illegal is not illegal until one gets caught." If those people get caught, they would have to pay not only unpaid taxes, but also penalties and interest. There is also the possibility of imprisonment. It is up to you if you want to risk it.

I would suggest going to the Tax Assessor's office in your city or municipality. Have your property -- land and building -- assessed. A reasonable assessment would be based mainly on two things: zonal valuation (not selling price) of the property and the bill of materials and labor or the cost of construction of your structure as stated in your building permit.

Do not transact with / give money to inspectors visiting your property. All payments should be made at the Tax Assessor's Office.  See if you can avail of early-bird discounts.  Pay your property taxes properly and promptly.

I am wondering,whether someone will post exact information about price and taxes ? So,what is average cost of one square meter of land ? What is amount of taxes of the square meter ? Digits please. No poems and bla-bla-bla.

Yes this what I was asking for, need real price and maybe how they come to this price if someone knows, or is it charge whatever they want,

Vadim I did some research on the land and building Tax, formula for this is:

Computation:

assesors Land fee- P350.000 x 20% = P70.000
assesors Bulding fee P350.00 x 20% = P70.000

Basic Real Property Tax, Land and Improvement (house)
P70.000+P70.000 x 2% = P2.800

sample only but this is your formuler to work out what you must pay   

Building and other Structures
Residential

0.00 - 175.000 = 0%
175.000 - 300.000 = 10%
300.000 - 500.000 = 20%
500.000 - 750.000 = 25%
750.000 - 1,000.000.00 = 30%
1,000,000.00 - 2,000,000.00 = 35%
2,000,000.00 - 5,000,000.00 = 40%
5,000,000.00 - 10,000,000.00 = 50%
10,000,000.00 + = 60%

samangelevski wrote:

Yes this what I was asking for, need real price and maybe how they come to this price if someone knows, or is it charge whatever they want,

As I had advised in my previous post:

"I would suggest going to the Tax Assessor's office in your city or municipality. Have your property -- land and building -- assessed. A reasonable assessment would be based mainly on two things: zonal valuation of the property and the bill of materials and labor or the cost of construction of your structure as stated in your building permit."

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Check the zonal valuation of your property. Here's a link to zonal values as per the Bureau of Internal Revenue's (BIR) website: https://www.bir.gov.ph/index.php/zonal-values.html


A reasonable assessment for my property would be something like this:

Zonal value for my area: PhP9,750 / sq. meter
No. of square meters of my property: 308

Assessment for land: PhP9,750 x 308 sq. meters = PhP3,003,000

Cost of construction as per bill of materials submitted when I applied for building permit: PhP4,500,000.

Reasonable assessment for land and building: PhP3,003,000 + PhP4,500,000 = PhP7,503,000

In Quezon City, the tax rate is 2.5% of assessed value for residential properties.

Property tax: PhP7,503,000 x 2.5% = PhP187,575

Early bird discount: PhP187,575 x 20% = PhP37,515

Approximate tax due: PhP187,575 - 37,515 = PhP150,060

You said an inspector is coming to your house to assess its value. When you go to the Assessor's office to get the final assessment, ask if they can lower the assessment for your building. Sometimes, they will. Ask nicely and be politely. Being respectful goes a long way here in the Philippines.

you right when they have come we said we paid 2M for the house, well that was not true, and after that we asked if we can somehow pay less, he did that and booked our building at 1.5M, that same with land we paid 1.7M but we said 1M, it was all ok, but then we need 20% discount for early birds, they working this out by the formula i have stated here.

All Filipinos pay land tax and very very few pay property tax despite living on the land in a house ???  New subdivisions have a system that will end up on house completion with a list of requirements from the local municipal to obtain an "Occupancy permit".  Some times a building bond with the developer will only be returned if the occupancy permit is obtained. The list of requirements for this occupancy permit you wouldn't believe and includes paperwork that was sent in for your building permit ??     It is not in the law that you must have an occupancy permit and only a few people have it. No one will stop you living in your home without one....if a complaint is made then ask to see theirs! You can be sure that they don't have one.   Strange that you are made to work for the occupancy permit then pay for the privilege of doing so. If everyone paid the property tax I'd not complain but its a case of if you want to pay and if you don't then its ok too.

I have been tolled that building tax is not in the law yet, and this was said by family lawyer. and she never paid one yet, and let me tell you her house is Huge, like her kitchen is as big as my house,  must be 1000+ SQM

Living in the Province about 30 k from Davao City on family land, only property tax are paid every one has a house but no body pays building tax and no one collects it, I have ask and no one knows anything, altho this is agriculture land maybe that is the reason.

iam so sorry sir i dont know to much about it i have my other problem related to philippins would u like to know my problem

Yes I would like to know more about your problem
Me too I have problems
I would like to know about life in Philippines

Okieboy, to say to others here that no one pays building Tax or that no one knows about it is very very wrong, I do believe people around you will not telling you the truth about building Tax, I have posted the formula how to work out your Tax on the land and building, it is up to you if you pay or not, but there is penalties for late payment, I to know some people here they did not pay for 20 years, when they sale the property then they have to back pay every thing, and with penalties and interest as well, some say you have to pay some say no need, this is Philippines no one cares to tell the truth, but if you go to your City hall you will know for sure, never believe what they tell you, you should know that by now, you been here long enough to know matter.

As foreigners we tend to go for the right thing to do and after paying "Land Tax" we presume that its correct to pay the tax on the building that collectively is known as property tax. Buying land the solicitor will check that all taxes have been paid prior to the sale but he will not investigate to determine whether their is an "improvement"  such as a house. We have bought and sold several lots of land here in the Philippines. We sold our small bungalow to a couple of Filipinos who arranged the deed of sale and on it was only the land and its value from the land office. One lawyer even stamped a paper from us saying "no improvement plans received by this office". They are of course correct in that we didn't use them for documenting the plans, however the paperwork was accepted by the BIR. Our present house on land of 480 sq mts is at the tax office as land only, the previous owner had to pay 15 years back taxes before we transferred the land.  A UK friend of  built a large house in the Barrangy and went to the local office for property tax assessment on generally the living space of the house, it was a joke he said and family neighbors helped to reduce the amount he was to pay. NO ONE ELSE IN THE VILLAGE WERE PAYING PROPERTY TAX!  We have to be aware that property tax can be almost double the land tax and what happens when we expats  die and the poor wife has to fork out 6,000 pesos every year...mmmmm worth a thought?

Peter well 6000 only, that is very cheap, I was told I need to pay 13.500php
I was thinkinking this is a joke, plus my land tax of 7000 php, do not worry i am always thinking we are targets even from City hall, or BRG, maybe they think we grow money tree at the back.
I know lots of people do not pay for building tax, but then I know lots who do, this is always confusing when some do and some do not, this is just one hell of a confusing country that no one knows what they are doing, no laws in place, crazy crazy
hell they can not even tell from right hand to left hand, how Stupid is that, the same
I went to Manila for my visa everything was ready and my Visa was ready but been told to come back tomorrow, I asked why they simply said they are to busy to stamp my visa today, I said to the guy give me stemp and I will stemp it myself, but he just laugh, but when I look around they are not busy but doing nothing laughing and joking with each other, they make it so hard for us, and I don't know why will someone like to settle here, for what Woman ?? I am trying to teach my Wife right from wrong, but even then hard to do that, I tell you what if I did not have a kid I would have been gone long time ago, they find us somehow tell us how great they are, tells us how great we are, have a baby with us and then you find out the real person sleeping next to you, wrong wrong wrong..
this is why here is babies from every part of the world without fathers, I do not blame them at all I can see why they move out soon after, you can not win over a guy with sex.

Its wise for foreigners to live on a subdivision but it can be costly if you choose the wrong one. Another choice is to buy a building on a reasonable plot of land that needs lots of renovation then flatten it and rebuild, we did this. Water and electric already on plus only the land tax usually to pay.  Some guys do choose the wrong lady for their partners and its easy to see why, Maybe lease a plot then build a place for yourselves keeping all the receipts for yourself if a problem arises with the lady. what do they say "horses for courses".  I remember a post once where a Filipino was asked for property tax and she went to the municipal and asked to see their receipts before she paid hers. Of course she never heard anymore of them and the original demand could have been because she was married to a foreigner.

Hello po.
i am from Batangas city.
i have now a house and lot which i purchased via Pagibig Housing Loan.
we already occupied our house since April 2017,
but we were not able to discuss on how we will pay for the tax.
its been a year and 6months since the realtor gave us the keys to our house.
we will finish paying the downpayment next month, November 2018.
in addition to that downpayment, we are also paying for the monthly amortization to Pagibig which i am paying via SkyFreight/Fawri here in Riyadh.
since we already occupied the house since April 2017, does it mean that we would have penalty for tax?
thank you in advance

Follow the rules and have an occupancy permit and then pay the property tax your choice. There are no inspectors to check your situation and no one will prevent you living in your house without a permit.  Leave a wheelbarrow with sand in it and say the property is not finished.                                                                                                                We have a window next to the other windows for land tax payment labeled "Property tax" and never have I seen anyone there.