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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.