Selling land or a house: CGT, DST and the BIR steps (Form 1706 and 2000-OT)
This guide is for a seller, a buyer, or a notary's assistant who has a signed deed of sale and needs to know what the BIR wants next. At the end you will know which two returns to file, how the tax base is picked, the deadlines, what the law says about who pays, and the order of offices after the BIR. It covers property held as a capital asset (not property a business holds for sale). It is not legal advice; for a judgement call, ask a lawyer or your RDO.
The two taxes
Tax · Form · Rate and base · Source; Capital gains tax (CGT) · BIR Form 1706 · 6% of the gross selling price or the current fair market value, whichever is higher · NIRC Sec. 24(D); Documentary stamp tax (DST) · BIR Form 2000-OT · ₱15 for each ₱1,000 (or part of it) of the consideration or the fair market value, whichever is higher · NIRC Sec. 196
The fair market value is worked out on the return itself. Schedule 1 of the BIR Form 1706 asks for the value in the tax declaration and the BIR zonal value, and takes whichever is higher. This is why writing a lower price in the deed does not lower the tax: the base is the higher number.
If the property was your principal residence and you put the whole proceeds into a new principal residence within 18 calendar months, the CGT can be exempt (NIRC Sec. 24(D)(2)). The 1706 has items 8 and 9 for this.
Deadlines
Return · When · Source; CGT (1706) · Within 30 days following each sale or other disposition · NIRC Sec. 51(A)(2)(b); DST (2000-OT) · Within 10 days after the close of the month in which the document was made, signed, accepted or transferred; pay when you file · NIRC Sec. 200(B), as amended by RA 11976
For the DST, a deed signed on 12 March gives you until 10 April. Older blog posts say the 5th of the next month; RA 11976 (the EOPT law) now says ten days. The CGT clock runs from the sale, and the law does not say "from notarization", so if the deed was signed and notarized on different dates, ask your RDO which date it counts from.
Who owes it: the law versus the contract
This is the question most people ask online. Read it in two layers.
The law. The CGT is a tax on the *seller's* presumed gain (NIRC Sec. 24(D)), and the 1706 lists the seller first. The DST is different: the code levies it on "the person making, signing, issuing, accepting, or transferring" the document (NIRC Sec. 173), which can reach either party.
The contract. The people on the deed can agree that the buyer shoulders the CGT, the DST, the transfer tax and the notary fee. Many sellers bear the CGT and buyers the rest, but nothing in the tax code fixes this; it is whatever the deed says. That is the trap in the posts we read: a verbal "ako na bahala sa tax", or a separate paper, and then the seller disappears. So:
- Write who pays each item in the deed itself, before it is notarized. - If the buyer pays the seller's CGT, the buyer is paying the seller's tax; say so, and keep the receipts. - Whether such a clause can be enforced against a seller who vanishes is a question for a lawyer, not this page.
What to bring to the RDO
The BIR's own checklist for the CGT computation lists, among others (BIR checklist, Annex D-1):
- TIN of the seller and the buyer (if one is missing, register first). - The notarized deed of sale: one original and two photocopies. - Certified true copy of the tax declaration, and of the title (OCT, TCT or CCT). - A Certificate of No Improvement when the declared lot has no building. - A notarized SPA if someone signs for a party, with IDs. - PSA marriage certificate if the seller is married; apostille or consular certification if the deed or SPA was signed abroad.
Both forms have an "RDO code of location of property" item: you file with the RDO that covers the property.
After the BIR
1. eCAR. The BIR issues the electronic Certificate Authorizing Registration from the RDO with jurisdiction over the property, even if the taxes were paid elsewhere (RMC 56-2024). Since RR 12-2024, an eCAR stays valid until it is presented to the Registry of Deeds (RR 12-2024). 2. Local treasurer, transfer tax. The law makes the seller pay it within 60 days from the date of the deed. For a province the cap is 50% of 1% of the price or the fair market value, whichever is higher, and a city may go up to 50% above the provincial maximum (Local Government Code Sec. 135 and 151). 3. Registry of Deeds. It may not register a transfer until the BIR has certified that it was reported and the tax paid (NIRC Sec. 58(E)). It also requires proof of the transfer tax payment (Local Government Code Sec. 135). 4. Assessor. It asks for the same proof before cancelling the old tax declaration and issuing a new one (Local Government Code Sec. 135).
Mistakes that cause trouble
- Paying CGT on the deed price when the zonal value or tax-declaration value is higher. - Leaving "who pays" to a chat message. - Filing late: both forms have lines for surcharge, interest and compromise. - A TIN missing for one party, a wrong RDO, or a name on the deed that differs from the title.
Questions
Who pays capital gains tax, the buyer or the seller? The code taxes the seller (Sec. 24(D)). The deed may allocate the cost to the buyer; put that in writing before notarization.
Sino ang magbabayad ng DST sa bentahan ng lupa? The code levies it on whoever makes, signs, accepts or transfers the document (Sec. 173), so either party can be asked. Who bears the cost is for the deed to say.
Can I write a lower price in the deed to reduce the tax? It does not help: the tax base is the higher of the price and the fair market value (Sec. 24(D)). Ask a lawyer about the risk of misstating a price.
Does PDFPhile file the 1706 or 2000-OT? No. It fills the forms. You sign them and file them with the BIR.
Last checked 2026-10-12. Not affiliated with BIR, SSS, PhilHealth, Pag-IBIG or any government agency.