• No products in the cart.

Profile Photo

Documentary Stamp Tax Computations

There are things that should be considered when applying Documentary Stamp Tax (DST) on transactions. The following should be considered:

WHAT             Determination of transactions that needs DST

HOW               How to compute and file DST

WHEN             Identification of the date the transaction has been made. This is important because the deadline of filing and payment of DST will depend on this date.

The following are the transactions that need DST:

  1. Sale of real property
  2. Loan agreements
  3. Lease agreements
  4. Mortgages

Sale of real property

Determine the selling price and fair market value of the real property. Whichever is higher between the two will be the basis for the DST computation. The amount will now be divided by P1,000 (the amount should be rounded off), then multiply it by P15.

 

Loan agreements

DST on loan agreements is computed as P1.00 for every P200. Thus, if the company obtained a loan in the amount of P1,000,000, the DST on the loan agreement is P5,000 (1,000,000 divided by 200).

 

Lease agreements

DST on lease agreement is P3.00 for the first P2,000 and additional P1.00 for every P1,000 in excess of the P2,000. Determine the following information in the lease contract:

 

  1. Monthly rent
  2. Number of years stated in the contract

 

The monthly rent will be multiplied by 12 then multiply by the number of years stated in the contract. Then subtract P2,000 and multiply by 0.001 then add P3.00

 

For example, the following where obtained from the lease contract:

Monthly rent P12,000
Number of year stated in the contract 5 years

 

 

The computation will be:

Monthly rent 12,000
Multiply by 12 12
Annual rent 144,000
Multiply by 5
Total contract amount 720,000
Subtract 2,000
718,000
Multiply by 0.001
718
Plus 3
DST amount 721

 

 

Mortgages

Subtract P5,000 from the amount stated in the contract then divide the remaining by P5,000 (amount should be rounded off), then multiply the amount by 10 then add P20.

 

For example, if the mortgage is P120,000, the DST will be computed as follows:

 

Amount of mortgage 120,000
Subtract 5,000
115,000
Divided by 5,000
23
Multiply by 10
230
Add 20
DST amount  250

 

Deadline for DST

DST Return (Form 2000-OT) should be filed within five (5) days after the close of the month when the taxable transaction was made. For example, if the lease contract was made and signed on July 15, 2014, the DST will be due on August 5, 2014.

 

Where to file and pay DST?

For sale of real property, lease agreements and mortgages, the DST should be paid on the Authorized Agent Bank (AAB) of the RDO having a jurisdiction over the place where property is located. For loan agreements, the DST should be paid and filed on the AAB of the of the RDO of the individual or company who obtained the loan.

November 9, 2017

No comments, be the first one to comment !

Leave a Reply

Your email address will not be published.

© EAA 2007. All rights reserved.

Login

Register

FACEBOOKGOOGLE Create an Account
Create an Account Back to login/register
X