Assessment of Real Property Tax

This article is related to this one and this one.

Real property is determined by the local assessor at its fair market value. The fair market value is multiplied by the approximate assessment level to get the assessed value. The assessed value is then multiplied by the applicable rate of levy to get the tax due. The formula then looks like this:

Tax Due = Applicable Rate of Levy (Fair Market Value x Approximate Assessment Level)

Real property assessments are revised every 3 years. They accrue on January 1 of every year but can be paid in quarterly installments.

Protesting the assessment of land value for real property taxation involves the following steps:

1.) The local assessor makes an appraisal on the land based on the current market value and classifies is according to actual use

3.) The local assessor then applies the assessment level and fixes the property's assessed value

4.) A notice of assessment is sent to the owner of the real property (or whoever it's registered under)

5.) The owner has 60 days from receipt of the notice to file a protest before the Local Board of Assessment Appeals (LBAA)

6.) The LBAA has 120 days to decide the case

7.) If the decision isn't favorable, the owner a must appeal to the Central Board of Assessment Appeals (CBAA) within 30 days from receipt of the decision

8.) If the decision is still unfavorable, file a petition for review before the CTA en banc within 30 days from receipt of the CBAA decision

9.) If the CTA's decision is still unfavorable, go to the SC on certiorari under Rule 45 within 15 days from receipt of the CTA decision

Protesting the assessment and collection of real property tax (not the same as assessment of land value) involves the following steps:

1.) The local assessor submits an assessment roll to the local treasurer, who informs the public when the tax is to be paid. This is done by posting the notice at a conspicuous place and publication in a newspaper of general circulation in the locality once a week for 2 consecutive weeks (both posting and publication are necessary and can't be alternated.)

2.) The local treasurer assesses and collects the tax starting January 1.

3.) The taxpayer pays the tax under protest. He must file a written protest to the local treasurer within 30 days from payment.

4.) The local treasurer has 60 days to decide.

5.) If the local treasurer denies the protest or fails to act within the 60-day period, the taxpayer has another 60 days from the date of receipt of denial or 60 days from the close of the first 60-day period to appeal to the LBAA.

6.) The LBAA has 120 days to decide.

7.) If the LBAA's decision is unfavorable, the taxpayer must appeal to the CBAA within 30 days from receipt of the LBAA decision.

8.) If still unfavorable, the taxpayer must file a petition for review with the CTA en banc within 30 days from receipt of the decision.

9.) If the CTA 's decision is also unfavorable, go to the SC on certiorari within 15 days from receipt of the CTA decision.

The sharing of real property taxes are as follows:

1.) Province: the municipality collects for the province

Province: 35%

Municipality 40%

Barangay: 25%

2.) City:

City: 70%

Barangay: 30% (50% to the barangay where the tax came from and 50% divided among the other barangays equally)

3.) Municipalities in Metro Manila:

MMDA: 35%

Municipality: 35%

Barangay: 30% (same rule of distribution as that of the city)

Internal Revenue Allotment

For national taxes, the national government gets 60% of the IRA while the LGUs get 40%. This LGU 40% is divided like this:

City: 23%

Province: 23%

Municipality: 34%

Barangay: 20%