BUREAU OF INTERNAL REVENUE

Salient Features of the Revised Revenue Regulations on REIT

January 20, 2020

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Background
• 2009: Republic Act No. 9856 – Real Estate Investment Trust Law
• 2011: BIR Revenue Regulations No. 13-2011
• 2018: Republic Act No. 10963 or the TRAIN Law

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 Salient Features of the new RR on
REIT
On the matter of VAT exemption
• Transfer of property, real or personal, especially those
classified as ordinary asset are now exempt from VAT
if made pursuant to Section 40(C)(2) of the Tax Code.

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 Salient Features of the new RR on
REIT
On the requirement of Minimum Public Offering
(MPO)
• The MPO requirement from 40% will now be down to
1/3 of the outstanding capital stock of REIT as
originally provided by the REIT Law

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 Salient Features of the new RR on
REIT
On the matter of Escrow Requirement
• The revised RR on REIT will no longer have the escrow
requirement

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 Salient Features of the new RR on
REIT
On the matter of the REIT Reinvestment Plan
• Mandatory submission of REIT Reinvestment Plan
• The Reinvestment Plan together with the Certificate of
Compliance from SEC shall be required to be
submitted to the BIR together with the annual filing of
the REIT’s ITR.

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 Salient Features of the new RR on
REIT
Reminder:
The BIR RR still bears a strong mandate for the REIT’s
compliance with the:
• REIT Law; and
• BIR administrative reportorial requirement.
Otherwise, non-compliance would mean withdrawal
of tax incentives.

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THANK YOU