Penalties and Fees for a Deed of Sale Valued at ₱350,000 (Philippine context)

Quick note: This is general information, not legal advice. Rules are national, but some fees/timelines are set by your local government or office and can change. Always confirm with your BIR Revenue District Office (RDO), the City/Provincial Treasurer, and your Registry of Deeds (RD).

What counts as the “value” for taxes?

For real property (land/house/condo), the tax base is the highest of:

the contract price in your deed,
the BIR zonal value, or
the Assessor’s fair market value (tax declaration).

If you say “₱350,000,” but the zonal or tax-declared value is higher, taxes are computed on the higher figure. (If this is a sale of a motor vehicle or movable, see the special note near the end—national real-estate taxes generally don’t apply.)

The core taxes and standard fees (real property)

Assuming ₱350,000 is also the highest value:

Capital Gains Tax (CGT) – 6% of value (generally when the seller is an individual selling a capital asset). Computation: 6% × 350,000 = ₱21,000
- Not used if the property is an ordinary asset sold in the ordinary course of business (e.g., developers/brokers). In those cases, income tax and creditable withholding tax (CWT) rules apply instead of CGT.
Documentary Stamp Tax (DST) on deed of sale of real property – 1.5% of value. Computation: 1.5% × 350,000 = ₱5,250
Local Transfer Tax (paid to your City/Provincial Treasurer) – typical maximums:
- Provinces: up to 0.5% → ₱1,750
- Cities/Metro Manila: up to 0.75% → ₱2,625 (Your actual rate depends on the local ordinance.)
Registry of Deeds registration fees – based on an LRA fee schedule that scales with value; expect a few thousand pesos at this price point. The RD also collects small IT/entry fees and charges for certified copies.
Notarial fee – market-based. For deeds of absolute sale, many notaries charge a flat fee or ~0.5–1% of the price (rough guide only); at ₱350,000 that could be roughly ₱1,750–₱3,500+ depending on location/complexity.
Miscellaneous – certified copies, tax clearance fees, and photocopying (usually minor).

Principal residence relief (CGT): Sellers who are natural persons may be exempt from CGT if 100% of the proceeds are used to buy/build a new principal residence within 18 months, and the BIR is notified within 30 days from sale. If only part is reinvested, CGT applies proportionately to the unutilized portion. (DST and local taxes still apply.)

Filing order & where you pay (real property)

Notarize the Deed of (Absolute) Sale.
BIR (ONETT/eCAR process):
- File and pay CGT (BIR Form 1706) within 30 days from date of notarized sale.
- File and pay DST (BIR Form 2000–OT). DST for one-time transactions is typically due on or before the 5th day following the month when the deed was notarized.
- Submit required documents and secure the eCAR (Certificate Authorizing Registration).
Local Treasurer: Pay Local Transfer Tax (and settle any real property tax arrears, if any; arrears block transfer).
Registry of Deeds: Present the eCAR, receipts, and owner’s duplicate title to transfer the title; pay registration fees.
Assessor: Update the tax declaration to the new owner.

Penalties if you miss deadlines (BIR & LGU)

A) BIR penalties (CGT and DST)

If you file/pay late, BIR typically imposes:

Surcharge: 25% of the basic tax (50% if willful neglect or false return).
Interest: “Double the legal interest rate” per annum (computed daily) on the basic tax until paid. In recent years this effectively worked out to ~12% per year, but it can change—BIR uses the prevailing rate set by BSP.
Compromise penalty: A fixed amount under BIR’s internal schedule depending on the deficiency/violation (commonly hundreds to a few thousand pesos for small cases).

Interest is computed on the basic tax, not on the surcharge/compromise. Surcharge is a one-time addition.

Illustrative late-payment math for ₱350,000 value:

CGT basic tax: ₱21,000
DST basic tax: ₱5,250

If filed 1 month late:

CGT: surcharge 25% = ₱5,250; interest ≈ 12%/yr × 1/12 × ₱21,000 = ₱210 → ₱21,000 + 5,250 + 210 = ₱26,460 (+ compromise)
DST: surcharge 25% = ₱1,312.50; interest ≈ 12%/yr × 1/12 × ₱5,250 = ₱52.50 → ₱5,250 + 1,312.50 + 52.50 = ₱6,615 (+ compromise)

If filed 3 months late:

CGT interest ≈ 12% × 3/12 × 21,000 = ₱630 → ₱21,000 + 5,250 + 630 = ₱26,880 (+ compromise)
DST interest ≈ 12% × 3/12 × 5,250 = ₱157.50 → ₱5,250 + 1,312.50 + 157.50 = ₱6,720 (+ compromise)

If filed 12 months late:

CGT interest ≈ 12% × 12/12 × 21,000 = ₱2,520 → ₱21,000 + 5,250 + 2,520 = ₱28,770 (+ compromise)
DST interest ≈ 12% × 12/12 × 5,250 = ₱630 → ₱5,250 + 1,312.50 + 630 = ₱7,192.50 (+ compromise)

Undervaluation/deficiency: If BIR revalues the property at a higher zonal/tax value, it will assess deficiency CGT/DST on the difference plus the same surcharge, interest, and compromise.

B) Local Transfer Tax penalties (LGU)

Under the Local Government Code, LGUs commonly impose:

Surcharge: up to 25% of the basic transfer tax for late payment.
Interest: up to 2% per month of the unpaid amount, capped at 36 months.

Illustration at ₱350,000 value:

Province (0.5% = ₱1,750): 3 months late → surcharge ₱437.50 + interest 6% of 1,750 = ₱105 → total ₱2,292.50
City/Metro Manila (0.75% = ₱2,625): 3 months late → surcharge ₱656.25 + interest 6% of 2,625 = ₱157.50 → total ₱3,438.75

LGU timing practices vary (e.g., deadlines counted from notarization vs. before registration). Ask your Treasurer’s Office for the exact rule where the property sits.

Checklist of typical documents (real property)

Notarized Deed of Absolute Sale (and, if applicable, proof of full payment).
TINs of seller and buyer.
Latest tax declaration(s) (land & improvements), and real property tax clearance or latest official receipts.
Transfer Certificate of Title/Condominium CCT (owner’s duplicate).
Valid IDs of parties and witnesses.
BIR forms & receipts (CGT, DST) and the eCAR.
Local Transfer Tax receipt.
Any special documents (SPA, court orders, marital consent, CARP clearance, etc.) depending on facts.

Special notes & edge cases

Ordinary asset / developer sales: No CGT; instead, CWT (creditable withholding) and VAT rules may apply, with the seller recognizing income tax on net income. At a ₱350,000 price, VAT may be exempt for certain residential sales depending on current thresholds and the nature of the property/seller. Confirm current thresholds and your seller’s tax profile.
Sale to government: May be subject to a different withholding regime; ask the BIR/RDO handling your case.
Real property tax (RPT) arrears: Must be fully settled (with LGU interest/penalties) before RD transfer.
Buyers’ additional costs: Due diligence (e.g., certified true copy of title, tax dec, GIS checks), survey/relocation, and bank charges (if financing) are separate from taxes.
Movables (e.g., motor vehicles): The national CGT/DST for real property do not apply. You’ll pay notarial fees and LTO transfer/registration fees (and penalties for delayed LTO transfer), which have their own schedules. Bring the deed, CR/OR, IDs, and clearance if required.

At-a-glance cost snapshot (₱350,000 base value; real property)

CGT (6%) ……………………………………… ₱21,000
DST (1.5%) …………………………………… ₱5,250
Local Transfer Tax ………………… ₱1,750–₂,625 (location-dependent)
RD Registration Fees ……………… a few thousand pesos (schedule-based)
Notarial Fee ……………………………… market rate (~0.5–1% or flat)
Penalties (if late) ………………… BIR: +25% surcharge + interest (≈12%/yr) + compromise; LGU: +25% surcharge + up to 2%/mo interest (≤36 mos)

Practical tips to avoid penalties

File CGT within 30 days and DST by the 5th day after the month of notarization. Do them together as part of the eCAR process.
Use the highest value (contract/zonal/tax-dec) from the start to avoid deficiency assessments.
Clear RPT before eCAR/RD steps.
Ask the Treasurer for the exact transfer tax deadline and rate for your LGU.
Keep originals and certified copies of IDs, title, tax dec, and receipts—RDs are strict.
If claiming principal residence CGT relief, file your notice within 30 days and diarize the 18-month reinvestment deadline.

If you want, tell me where the property is located (city/province) and who the seller is (individual vs company), and I can tailor the exact computation—including local rates, the right tax base if zonal/tax-dec is higher than ₱350,000, and sample totals with/without penalties.