How To Compute DST
How To Compute DST
How To Compute DST
classified as ordinary asset, and transfer of shares of stock not traded through
the local stock. Please click here to download the Form.
Example: A residential lot in Pasig City with a floor area of 200sqm has a
Selling Price of P3 Million. The Deed of Sale stipulated that the buyer shall
shoulder DST. The following are the fair market value information of the real
property:
1. Fair Market Value as determined by BIR Commissioner (Zonal
Value/BIR Rules):
1a. Land: P1,600,000 (let us say BIR Zonal value is P8,000/sqm [200 x
8,000=1,600,000])
1b. Improvement: P1,200,000
2. Fair Market Value as determined by Provincial/City Assessors (per
latest Tax Declaration):
2a. Land: P1,400,000
2b. Improvement: P1,300,000
Question: How much is the DST?
Answer/solution:
Step 1. Determine the highest fair value (FMV):
Total FMV1 (1a + 1b): P2,800,000
Total FMV2 (2a + 2b): P2,700,000
Total FMV3 (1a + 2b): P2,900,000
Total FMV4 (2a + 1b): P2,600,000
The Highest FMV is FMV3: P2,900,000. This is the FV we will use in the step
2.