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So apparently, the BIR issued a circular regarding ante-dated Deeds of Sale (DOAS) last May 28. Here's how I understand it...
Background:
+ When people sell properties, taxes are based on the higher of the zonal value or the amount on the DOAS.
Payment of these taxes has specific deadlines:
+ Capital Gains Tax: within 30 days
+ Documentary Stamp Tax: by the 5th of the following month
+ Creditable Withholding Tax (CWT): by the 10th of the following month
The Issue:
+ Problems arise when zonal values are revised, and sellers only find out after the new values take effect. To avoid higher taxes due to the new zonal values, some might backdate the notarization of their documents to before the effective date of the zonal value increase.
BIR RMC 64-2024:
If parties present transaction documents to the BIR after the new zonal values take effect, but the documents have a notarization date from before the new values took effect, the BIR will consider these documents as ante-dated.
The burden is on the parties to prove to the BIR Examiner that the documents were not ante-dated.
If they can't prove this, the transaction will be subject to:
+ A 25% penalty
+ 20% annual interest based on the time when the documents were presented to the BIR.
Stay tuned for tomorrow's Horror Story Tuesday for an actual example.
You may download a copy of RMC 64-2024 below.
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