Sample Scenario and Computation #1: CAPITAL ASSET

Mr. Juan dela Cruz sold his house and lot in Marikina City to Ms. Juana Batungbacal for
PHP20,000,000.00. The BIR zonal value for the said house plus the value of the improvement is
PHP15,000,000.00. The Market value based on the Assessor’s valuation is PHP5,000,000. The
sale was successfully handled by Broker Timothy. The agreed broker’s commission is 5% for the
account of the seller which will be based on the Total Contract Price. Likewise, the CGT is for
the account of the Seller. The Notarial Fee, DST, Transfer Tax and Registration fees shall be for
the account of the Buyer.

Compute for the following: 1. Broker’s commission; 2. CGT; 3. DST; 4. Transfer Tax; 5.
Notarial fee of 1%; and 6. Net proceeds to the seller

1. Broker’s commission =
Selling Price x Rate = PHP20,000,000.00 x 5% = PHP1,000,000.00

2. Capital Gains Tax =

Selling price is the highest among the 3 values
Selling Price x 6% = PHP20,000,000.00 x 6% = PHP1,200,000.00

3. DST
Selling Price x 1.5%
PHP20,000,000.00 x 1.5%= PHP300,000.00

4. Transfer Tax
Selling Price x .75% (maximum rate for Metro Manila)
PHP20,000,000 x .75%= PHP150,000.00

5. Notarial fee
PHP20,000,000.00 x 1%= PHP20,000.00
6. Net proceeds to seller =
Selling Price – (Commission + CGT) =
PHP20,000,000.00 – (PHP1,000,000.00+PHP1,200,000.00) =PHP17,800,000.00

Sample Scenario and Computation #2: ORDINARY ASSET

Joshua bought one (1) condominium unit from Eyele Land Corporation for PHP4,000,000.00
through the assistance of Broker John. Thebuyer paid it in full. The broker’s commission is 3%.
The zonal value for the property is PHP3,500,000.00. The assessor’s valuation is
PHP2,000,000.00. The DST, Transfer tax, Notarial fee and registration fees already form part of
the selling price which is considered as Other fees amounting to PHP150,000.000
Compute for the following: 1. VAT; 2) Broker’s commission whose income for the current year
does not exceed 3 Million; 3. Withholding tax on commission; 3. Net broker’s commission; and
4. CWT.

1. VAT
Selling Price is the highest among the 3 values
Selling Price ÷1.12 x 12%
PHP4,000,000.00 ÷1.12 x 12= PHP428,571.42

2. Broker’s Commission
Selling Price (Net of Vat) x Applicable Rate
PHP3,571,428.58 x 3% = PHP107,142.85

3. Withholding Tax (5%)

Broker’s Commission x Withholding Tax Rate
PHP107,142.84 x 5% = PHP5,357.14
4. Net Broker’s Commission = PHP107,142,85– PHP5,357.14 = PHP101,785.71

5. CWT
Selling Price (net of Vat) x applicable CWT rate
PHP3,571,428.58 x 5%= PHP178,571.42