The local transfer tax on a property sale, province versus city.
Transfer tax
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Tax base
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Rate applied
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A tax your city or province collects, not the BIR
Most of the taxes on a Philippine property sale flow to the national government through the Bureau of Internal Revenue. The transfer tax is the exception. It is a local government charge, paid to the provincial treasurer if the land sits in a province or to the city treasurer if it sits in a city or a municipality within Metro Manila. Its legal home is the Local Government Code, which lets each local unit set the rate up to a ceiling. That is why two properties of the same value can carry different transfer tax bills depending on where they stand.
Because the rate is set locally and capped by statute, this tool models the ceilings: 0.5 percent in a province and 0.75 percent in a city, the bands this calculator applies. Your actual local ordinance may sit at or below those caps, so treat the result as the upper end and confirm the exact rate with the treasurer's office that has jurisdiction over the property.
Why the base is the higher of price or zonal value
The transfer tax does not simply take a slice of your contract price. It applies to the higher of the selling price and the fair market value, the same convention the national capital gains tax and documentary stamp tax use. The reasoning is straightforward: if a low price on paper set the base, parties could understate the deal to shrink every tax at once. By pinning the base to whichever figure is larger, the local treasurer protects the collection. Enter both values and the calculator picks the higher one for you and shows which band it then applies.
Province versus city: where the band sits
The single biggest driver of the bill, once the base is fixed, is whether the property is provincial or urban. Consider a PHP 5,000,000 base, the calculator's default, computed at each ceiling using the rates this calculator applies.
| Location | Rate ceiling | Transfer tax on PHP 5,000,000 |
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The urban property costs PHP 12,500 more on the same value, because the city ceiling of 0.75 percent sits a quarter of a percentage point above the provincial 0.5 percent, which is fifty percent more in relative terms. Scale that up and the gap grows: on a PHP 12,000,000 lot the bill is PHP 60,000 in a province against PHP 90,000 in a city. The chart traces how the transfer tax climbs with the base under each band.
When the bill is due and who files it
The transfer tax is typically paid within sixty days of the deed of sale, and the local treasurer's office issues a tax clearance once it is settled. That clearance is one of the documents the Registry of Deeds wants before it will issue a new title, so paying it late can stall the whole transfer. The buyer customarily pays it, since the buyer is the one who needs the new title, though again the deed can say otherwise. A common mistake is treating the transfer tax as the same thing as the documentary stamp tax. They are separate charges to separate offices, and a buyer budgets for both.
Is the local transfer tax the same as the BIR documentary stamp tax?
No. The documentary stamp tax is a national tax paid to the BIR, while the transfer tax is a local tax paid to the provincial or city treasurer. They are computed on the same base but go to different offices, and a property transfer needs proof that both have been paid.
Can a local government charge more than the rates shown here?
The Local Government Code sets ceilings, 0.5 percent for provinces and 0.75 percent for cities and Metro Manila municipalities, and a local ordinance cannot exceed them. Many units charge at the ceiling, but some sit below it, so the figure here is the maximum. Confirm the precise rate with the treasurer's office for the property's location.
What happens if I pay the transfer tax late?
Late payment usually attracts surcharges and interest set by the local ordinance, and the treasurer will not release the tax clearance until everything is settled. Since the Registry of Deeds needs that clearance to issue the new title, a delay here can hold up the entire transfer, so it is worth paying within the window.