Effective 01 January 2012, BIR rules Increased Threshold for VAT Exemption
The BIR has released Revenue Regulations (RR) No. 16-2011 dated October 27, 2011 which increased the threshold amounts for VAT on the sale of residential lots and house and lots, the lease of residential units, and the threshold amount for the sale of goods and services subject to VAT.
Effective January 1, 2012, the sale of a residential lot which is PHP1,919,500.00 and below (Current - PHP1,500,000 and below), and the sale of a residential house and lot which is PHP3,199,200.00 and below (Current - PHP2,500,000) are exempt from VAT.
The lease of a residential units which is PHP12,800 and below (Current PHP10,000) shall also be exempt from VAT effective January 1, 2012.
If a person's gross annual receipts/sales on the sale or lease of goods or properties or performance of services other than those mentioned in Sec. 109 of the Tax Code does not exceed PHP1,919,500.00, (Current - PHP1,500,000) he shall be subject to 3% percentage tax instead of the 12% VAT.
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