VAT Exemption Threshold for Sale of House and Lot and Other Residential Dwellings Increased
The Bureau of Internal Revenue through its Revenue Regulations No. 1-2024 communicated the new value-added tax (“VAT”) exemption threshold for the sale of real properties not primarily held for sale to customers or held for lease in the ordinary course of trade or business, sale of real property utilized for socialized housing as defined by Republic Act No. 7279, sale of house and lot, and other residential dwellings.
The previous threshold was PHP3,199,200.00. Pursuant to Section 109(P) of the National Internal Revenue Code, as amended, the amount shall be adjusted to its present value using the Consumer Price Index (“CPI”), as published by the Philippine Statistics Authority (“PSA”).
Given this mandate and taking into account 2023 CPI values as published by the PSA, the new price threshold for the sale of house and lot and other residential dwellings for VAT-exemption purposes, rounded up, is PHP3,600,000.00.
The new threshold shall take effect beginning 1 January 2024.
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