RMC No. 99-2023

RMC No. 99-2023 clarifies the taxes due when a seller disposes of real property classified as an ordinary asset. It restates the RR No. 7-2003 definition of ordinary assets (expressly excluding government-seized properties sold at public auction), explains that only ordinary-asset sellers must issue sales invoices (with an official-receipt exception for VAT taxpayers engaged solely in sale of service), and describes the income tax treatment of the gain, the crediting of creditable withholding tax, and the required returns (BIR Forms 1606 and 2000-OT). It further states that such sales are generally subject to VAT subject to enumerated exceptions, that the VAT base is the higher of the consideration or the fair market value, and that donations of ordinary assets by VAT-registered persons are deemed sales subject to VAT.