1) What “Real Property Tax” covers for a newly built house

Real Property Tax (RPT) is a local tax imposed by the city/municipality/province on real property, which includes:

Land
Buildings and other improvements (your newly built house is an “improvement”)
Machinery (usually not relevant to ordinary homes)

RPT is governed primarily by the Local Government Code of 1991 (Republic Act No. 7160) and local ordinances that implement valuation and collection within each LGU.

A newly built house typically results in two separate tax declarations (or two lines in one declaration set):

Land (already declared or to be declared)
Building/Improvement (new declaration or updated declaration upon construction)

Even if the land is already taxed, the building is separately assessed and taxed once it exists as a taxable improvement.

2) Who assesses vs. who collects

Two local offices drive the process:

The Local Assessor (City/Municipal Assessor): Responsible for classification, appraisal/valuation, assessment, and issuance of a Tax Declaration (TD).
The Local Treasurer (City/Municipal Treasurer): Responsible for billing, collection, enforcement, and issuance of official receipts, including penalties for delinquency.

A common misconception is that the Treasurer “computes the value.” In law and practice, the Assessor determines assessed value, while the Treasurer collects the tax due based on that assessment.

3) Key concepts you must know (the “formula”)

A. Fair Market Value (FMV)

This is the market-based value assigned by the Assessor using the LGU’s schedules:

Schedule of Market Values (SMV) for land and buildings
Unit values per square meter, building type, quality, materials, age, depreciation, location, etc.

For buildings, FMV is often derived from an LGU schedule using:

floor area × base unit value × adjustment factors (structure type, finishing, depreciation, etc.)

B. Assessed Value (AV)

RPT is not imposed on FMV directly. It is imposed on Assessed Value, computed as:

Assessed Value = Fair Market Value × Assessment Level

C. Assessment Level (AL)

The assessment level is a legally defined percentage that depends mainly on:

Property classification (residential, commercial, industrial, agricultural, etc.)
Often also the FMV bracket (the law provides bracketed assessment levels, especially for buildings)

For a typical owner-occupied home, the classification is generally Residential.

D. RPT rates (Basic + SEF)

RPT is commonly composed of:

Basic RPT (local tax):

Up to 1% of assessed value in provinces
Up to 2% of assessed value in cities and municipalities within Metro Manila

Special Education Fund (SEF) Tax:

Commonly 1% of assessed value (imposed by LGUs for local education funding)

So, a city property commonly pays Basic (up to 2%) + SEF (1%), while a province commonly pays Basic (up to 1%) + SEF (1%)—subject to the exact local ordinance and rate structure within the legal caps.

4) When a newly built house becomes taxable

A. The duty to declare the new building

Upon completion of the improvement (or acquisition), the owner/administrator must file a sworn declaration with the Local Assessor within 60 days. This is a core legal obligation.

In practice, “completion” is commonly supported by:

Certificate of Completion
Occupancy Permit / Certificate of Occupancy
Sometimes a final inspection report, photos, and/or as-built plans

B. Supplemental assessment during the year

The Local Government Code allows supplemental assessments for newly discovered, omitted, or newly created taxable improvements (like a newly constructed house) during the year.

Practically, depending on LGU implementation:

Some LGUs issue a building Tax Declaration and begin billing for the remaining quarters of the year (via supplemental assessment), or
They finalize the new TD within the year but treat full regular billing as beginning the next January 1 cycle, while still preserving the power to collect for the appropriate period.

Because practice varies, the safest assumption is: declare promptly and expect that tax may be prorated or billed as soon as the LGU recognizes the completed building.

5) Step-by-step: How assessment typically happens for a newly built house

Step 1: Ensure the land is properly declared

Before or alongside building declaration, confirm the land has an existing Tax Declaration (TD) and correct:

owner name
location, boundaries, lot area
classification (residential, etc.)
any transfer or inheritance issues

Step 2: File a sworn declaration for the new building/improvement

You (or your representative) submit the declaration to the Assessor’s Office. Common attachments vary by LGU, but often include:

Building Permit (and approved plans/specs)
Occupancy Permit / Certificate of Completion
Location map / lot plan, sometimes sketch plan
Floor area computation, number of storeys, materials/finishes
Photos (some LGUs request these)
ID and authorization (if filed by a representative)

Step 3: Ocular inspection / field appraisal (often required)

The assessor’s staff may conduct an ocular inspection to confirm:

actual floor area
type of construction (wood, concrete, steel, mixed)
quality/class (economy/standard/better finishes, etc.)
presence of additional improvements (fence, garage, gate, pool)

Step 4: Classification and valuation using LGU schedules

The Assessor applies:

building unit values and adjustments (type, quality, age/depreciation)
classification (usually residential)
market value computation according to the LGU schedule and standards

Step 5: Issuance of a Tax Declaration (TD) for the building

You’ll receive (or be able to request) a copy of the Tax Declaration showing:

property identification
classification
FMV
assessed value
effectivity/assessment year and other notes

Step 6: Billing and payment at the Treasurer’s Office

Once in the system, the Treasurer’s Office issues the tax due (sometimes you must present the TD to trigger billing).

6) Payment rules: deadlines, installment options, discounts

A. Payment timing

RPT is payable annually, but may be paid in quarterly installments without interest if paid on time.

Typical quarterly due dates:

1st quarter: on or before March 31
2nd quarter: on or before June 30
3rd quarter: on or before September 30
4th quarter: on or before December 31

B. Discounts for advance payment

LGUs may grant discounts for early/advance payment (commonly when paying the full year within the first quarter). The Local Government Code allows LGUs to provide discounts via ordinance, subject to limits.

C. Where to pay

Treasurer’s Office cashier
Authorized collecting officers
Some LGUs offer accredited banks/online channels (varies by LGU)

Always keep:

official receipt
statement of account / tax bill
copy of the Tax Declaration(s)

7) Penalties and consequences of non-payment

A. Interest on delinquency

Delinquent RPT is subject to interest (often up to 2% per month) from the date it becomes due, subject to a cap (commonly not exceeding 36 months). The precise application is governed by the Local Government Code and local ordinances consistent with it.

B. Tax lien

RPT constitutes a lien on the property—a legal hold that follows the property and can prime many other claims.

C. Administrative remedies: levy and tax delinquency sale

If unpaid, the Treasurer may proceed with:

issuance of delinquency notices
levy on the property
advertisement and public auction (tax delinquency sale)

D. Right of redemption

After a delinquency sale, the owner typically has a redemption period (commonly one year) to redeem the property under the rules of the Local Government Code and local procedures.

8) Common issues specific to newly built houses

A. “My land has a TD, so I’m done.”

Not for a new house. The building is taxed as an improvement. Land TD ≠ building TD.

B. Undeclared improvements discovered later

Assessors can identify un-declared improvements through:

building permit records
occupancy permits
aerial imagery / field surveys
barangay/LGU mapping projects

If discovered later, you may face:

back assessment/supplemental assessment
interest for delinquency if taxes should have been paid earlier
delays in transactions (sale, bank loan, transfer)

C. Discrepancies between permit floor area and actual construction

If actual construction differs from approved plans, the assessor may assess based on what exists, not merely what was planned.

D. Multiple improvements

Separate assessments can apply to:

main house
annex/extension
garage, perimeter fence, paved areas (varies in treatment)
other substantial improvements

9) How to contest or appeal an assessment (important taxpayer remedies)

If you believe the assessment is too high or classification is wrong, remedies exist.

A. Administrative review/verification

Start by requesting:

the basis of valuation (building schedule/unit values)
computation worksheet (if available)
correction of factual errors (floor area, materials, age, classification)

B. Appeal to Local Board of Assessment Appeals (LBAA)

Formal appeals go to the Local Board of Assessment Appeals, typically within strict statutory periods after receiving notice of assessment.

C. Further appeal to Central Board of Assessment Appeals (CBAA)

Decisions may be elevated to the Central Board of Assessment Appeals, and then possibly onward under applicable rules.

Appeal processes are technical—deadlines, payment-under-protest rules, and documentary requirements matter.

10) Exemptions and special cases (usually limited for private homes)

Most privately owned residential houses are not exempt from RPT. Common exemptions in law are generally for:

properties owned by the Republic and LGUs (when used for public purpose)
charitable institutions, churches, parsonages/convents, mosques, nonprofit cemeteries
educational institutions (under conditions)
machinery and equipment used for pollution control and other narrowly defined cases

A newly built private residence generally does not qualify unless it falls under a specific constitutional/statutory exemption and actual use requirements are met.

11) Related local impositions you may encounter

Depending on the LGU, you may see additional charges linked to real property, such as:

special levies for public improvements benefiting the property
fees tied to permits and regulatory compliance (not RPT, but often confused with it)

These are legally distinct from RPT and have different bases and authorizations.

12) Practical checklist for homeowners who just finished building

Confirm land TD details are correct (owner name, location, lot area).
Prepare building documents (permits, occupancy/completion proof, plans, floor area).
File the sworn declaration within 60 days of completion/occupancy.
Keep a copy of the Building Tax Declaration once issued.
Ask the Treasurer for the latest statement of account (land + building).
Pay on time (annual or quarterly); keep receipts.
If the valuation seems wrong, request the computation basis and consider formal remedies within deadlines.

13) Government guidance and valuation standards (context)

Valuation and assessment standards are influenced by national oversight and guidance, commonly involving the Bureau of Local Government Finance under the Department of Finance, but the actual assessment and collection are executed through the LGU Assessor and Treasurer under the Local Government Code framework.

14) Key takeaways

A newly built house is a taxable improvement separate from the land.
RPT generally depends on FMV → assessed value → tax rate (Basic + SEF).
You must declare the improvement within 60 days of completion/acquisition.
Pay annually or quarterly, with possible discounts for advance payment.
Delinquency triggers interest, lien, and potential levy/sale.
You can contest overvaluation through administrative correction and formal appeal mechanisms.