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Revenue Regulations No
Revenue Regulations No
If the seller fails to utilize the proceeds of sale or disposition in full or in part within
the 18-month reglementary period, his right of exemption from the Capital Gains Tax
did not arise on the extent of the unutilized amount, in which event, the tax due
thereon will immediately become due and demandable on the 31st day after the date
of the sale, exchange or disposition of the principal residence.
REVENUE REGULATIONS NO. 4-99 issued March 16, 1999 further amends
Revenue Memorandum Order No. 6-92 relative to the payment of Capital Gains Tax
and Documentary Stamp Tax on extrajudicial foreclosure sale of capital assets
initiated by banks, finance and insurance companies. Where the right of redemption
of the mortgagor exists, the certificate of title of the mortgagor will not be cancelled
yet even if the property had already been subjected to foreclosure sale. Instead,
only a brief memorandum will be annotated at the back of the certificate of title, and
the cancellation of the title and the subsequent issuance of a new title in favor of the
purchaser/highest bidder depends on whether the mortgagor will redeem or not the
mortgaged property within one year from the issuance of the certificate of sale.
Thus, no transfer of title to the highest bidder can be effected yet until and after the
lapse of the one-year period from the issuance of the said certificate of sale. In case
the mortgagor exercises his right of redemption within one year from the issuance of
the certificate of sale, no Capital Gains Tax will be imposed because no capital gains
has been derived by the mortgagor and no sale or transfer of real property was
realized. In case of non-redemption, the Capital Gains Tax on the foreclosure sale
shall become due based on the bid price of the highest bidder, but only upon the
expiration of the one-year period of redemption, and will be paid within thirty (30)
days from the expiration of the said one-year redemption period. The corresponding
Documentary Stamp Tax will be levied, collected and paid by the person making,
signing, issuing, accepting or transferring the real property wherever the document
is made, signed, issued, accepted or transferred where the property is situated in the
Philippines.
Revenue Regulation No. 3-98
Issued June 4, 1998 implements Section 33 of the National Internal Revenue Code
(NIRC), as amended by RA No. 8424, relative to the special treatment of fringe
benefits granted or paid by the employer to employees, except rank and file
employees, beginning January 1, 1998. The definition of fringe benefits as well as
the determination of the amount subject to the fringe benefits tax are specified in
the Regulations.