Answered: Compute the DST payable

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Compute the DST payable, if any. Disregard any penalty, if any.

Relevant information:

Juan Dela Cruz, single, Filipino citizen, and a resident of N. Reyes St., Manila City sold a piece of land with improvement (house) located in Brgy. Forbes Park, Makati City.

In filing the Capital Gains Tax return, the BIR RDO which has jurisdiction over the transaction assigned Juan Taxpayer Identification No. 123-456-789-0000.

YOU are the buyer. The RDO which has jurisdiction over your residence assigned you TIN no. 987-654-321-0000.

As buyer, it was agreed, that you are to pay the documentary stamp tax.

Additional information:

Details	House and Lot
Title No.	14344
Tax Declaration No. - Land	99501
Tax Declaration No. - House	99502
Location	Brgy. Forbes Park, Makati City
Area	100sqm
Classification	Residential

Details	Zonal Value	Assessed Value
Lot in Makati	Php 10,000,000.00	Php 5,000,000.00
House		Php 5,000,000.00

Selling Price – Php 20,000,000.00
Deed of Absolute Sale was notarized in November 29, 2021
Disregard the penalty, if any
In the payment of the tax, YOU issued BPI Check No. 5254 on the date of sale.

Definition Definition Tax imposed by the government on the "gain" or increase in the value of an asset at the time of its sale by the owner. Capital gain is computed based on the purchase price and sale price of the asset. If the sale price of the asset is more than the purchase price, there is a gain on the sale of asset. A tax is imposed on such gain in accordance with the applicable tax rates at the time of sale.

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