1. What is Philippines RE Commission Tax?

The Philippines real estate commission tax consists of 12% VAT plus withholding tax (typically 5-10%) on the gross commission earned by real estate agents or brokers.

2. How Does the Calculator Work?

The calculator uses the following formula:

Where:

• \( Commission \) — Gross commission amount in PHP
• \( 12\% \) — Standard VAT rate in Philippines
• \( Withholding \) — Withholding tax (typically 5-10% of commission)

Explanation: The formula calculates both VAT and withholding tax separately, then sums them to get total tax liability.

3. Importance of Commission Tax Calculation

Details: Accurate tax calculation ensures proper remittance to BIR, avoids penalties, and helps agents understand their net income from transactions.

4. Using the Calculator

Tips: Enter gross commission amount in PHP and applicable withholding tax rate (default is 5%). All values must be valid (commission > 0, withholding between 0-100%).

5. Frequently Asked Questions (FAQ)

Q1: What is the standard withholding tax rate?
A: Typically 5% for individual practitioners, but can vary based on taxpayer status and other factors.

Q2: Is VAT always applicable?
A: Yes, unless the agent/broker is VAT-exempt (which is rare for professionals earning above the threshold).

Q3: When should these taxes be paid?
A: VAT is due monthly, while withholding tax should be remitted within 10 days after the month of payment.

Q4: Are there deductions allowed?
A: Yes, but this calculator shows gross tax liability. Actual taxable income may be reduced by allowable deductions.

Q5: What about other taxes?
A: This covers basic taxes. Income tax may still apply to net earnings after allowable deductions.