The Revenue Regulations No. 3-2012 has issued by the Bureau dated February 20, 2012 to informed the public the effectivity of Threshold Amounts for Sale of Residential Lot, Sale of House and Lot, Lease of Residential Unit and Sale or Lease of Goods or Properties or Performance of Services covered by Section 109 (p), (Q) and (V) of the Tax Code of 1997, as amended provides the amounts stated therein shall be adjusted to their present values using the Consumer Price Index as published by the National Statistics Office (NSO).
With the issuance of Revenue Regulations No. 16-2011 dated October 27, 2011, the threshold amounts has been adjusted as follows:
The new threshold amounts shall be made effective for instrument of sale (whether the instrument is nominated as a deed of absolute sale, deed of conditional sale or otherwise) is executed and notarized on or after January 1, 2012.
In addition with, pertinent portions of Section 4.106-3 of revenue Regulations no. 16-2005, as amended by Revenue Regulations No. 16-2011 should properly be worded as follows:
"Section 4.106-3 Sale of Real Properties. - sale of real properties held primarily for sale to customers or held for lease in the ordinary course of trade or business of the seller shall be subject to VAT.
Sale of residential lot with gross selling price exceeding P1,919,500.00, residential house and lot or other residential dwellings with gross selling price exceeding P3,199,200.00 where the instrument of sale (whether the instrument is nominated as a deed of absolute sale, deed of conditional sale or otherwise) is executed and notarized on or after January 1, 2012 and shall be subject to twelve percent (12%) output VAT.
However, for instruments of sale executed and notarized on or after November 1, 2005 but prior to January 1, 2013, the threshold amounts should appropriately be P1,500,000 and P2,500,000 respectively, and excess thereof shall be subject to ten percent (10%) output VAT, and starting February 1, 2006, to twelve percent (12%) output VAT.
Besides, Sections 4.109.-1 (B)(1), (p)(4) of Revenue Regulations No. 16-2005, as amended by Revenue Regulations No. 16-2011 should properly be worded as follows:
"(p) The following sales of real properties are exempt from VAT, namely:
(4) Sale of residential lot valued at One Million Nine Hundred Nineteen Thousand five Hundred Pesos (P1,919,500.00) and below, or house & lot and other residential dwellings valued at Three Million One Hundred Ninety-Nine Thousand Two Hundred Pesos (P3,199,200.00) and below where the instrument of sale/transfer/disposition was executed and notarized on or after January 1, 2012;
However, for instrument executed and notarized on or after Nov. 1, 2005 but prior to January 1, 2012, the threshold amounts should appropriately be P1,500,000 and P2,500,000 respectively.
Provided, that every three (3) years thereafter, the amounts stated herein shall be adjusted to its present value using the Consumer Price Index, as published by the National Statistics Office (NSO); Provided, further, that such adjustment shall be published through revenue regulations to be issued not later than March 31 of each year.
Please refer ftp://ftp.bir.gov.ph/webadmin1/pdf/62308RR%203-2012.pdf of the full text of the Revenue Regulations No. 3-2012.
