Scope of Taxation
The deed tax is levied on the transfer of title of real estate through sale, acceptance of a Dien Right, exchange, donation, subdivision, or occupancy, except where the land value increment tax applies. The deed tax is payable at the time of transfer.
Taxpayer
The taxpayer of the deed tax is the party that acquires title to real estate through a sale, acceptance of a Dien Right, exchange, donation, subdivision, or occupancy:
- Deed tax on a purchase and sale: reported and paid by the purchaser.
- Deed tax on the establishment of a Dien Right: reported and paid by the Dien Right assignee.
- Deed tax on an exchange: reported and paid by each party to the exchange on the portion allocated to each party.
- Deed tax on a donation: reported and paid by the recipient.
- Deed tax on a trust: In case the trust property is an immovable property and the trustee, by the purpose of the trust, transfers the trust property to a vested right holder other than the settlor, the deed tax on a donation shall be reported and paid by the vested right holder.
- Deed tax on a subdivision: reported and paid by the practitioner.
- Deed tax on acquisition by possession: reported and paid by the acquirer.
Tax Base
The value of deed is the standard price as determined by the local real estate assessment committee. If the purchase price of the immovable property acquired is below the standard price for publicly-owned property purchased or bid from a government agency or immovable property acquired at court auction, the value of deed is the purchase price.
Tax Rate
The deed tax rates are as follows:
| Type of Deed |
Tax Rate |
| Purchase and sale |
6% |
| Establishment of a Dien Right |
4% |
| Exchange |
2% |
| Donation |
6% |
| Subdivision |
2% |
| Acquisition by possession |
6% |
Exemptions
Exemptions are allowed for:
- Where a company is carrying out a division or merger/consolidation, or acquires assets or shares pursuant to Articles 27 through 30 of the Business Mergers and Acquisitions Act, with the shares entitled to voting rights as the consideration to pay the merged/consolidated company, and the shares are not less than sixty-five percent of the total consideration, such a titled holder of immovable property acquired is exempted from deed tax.
- A building that has the name of its builder changed prior to its completion. However this exemption shall not be applicable to the condition where an unfinished building is transacted involving sale, exchange, bestowal, or donation that the new owner becomes the original builder as stated in the construction license, or the name of the builder changes, and the new builder later on receives a use license.
- A building in construction that has the name of its builder changed for the purpose of continuing construction and that the use license of the building upon its completion is acquired in the name of the second builder.
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