BIR Form No. 1706

BIR Form 1706

BIR Form 1706

Capital Gains Tax Return for Onerous Transfer of Real Property Classified as Capital Asset (both Taxable and Exempt)

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This return is filed by all persons (natural or juridical) whether resident or non-resident, including Estates and Trusts, who sells, exchanges, or disposes of a real property located in the Philippines classified as capital asset as defined under Sec. 39 (A)(1) of RA 8424 for the purpose of securing a Tax Clearance Certificate to effect transfer of ownership (title) of the property from the seller to the buyer.

However, filing of the return is no longer required when the real property transaction involves the following:

- it is not classified as a capital asset 
- not located in the Philippines 
- disposition is gratuitous 
- disposition is pursuant to the Comprehensive Agrarian Reform

To be filed with the RDO having jurisdiction over the place where the property being transferred is located.

When to File?

- Filed within thirty (30) days following each sale, exchange or disposition of real property

- In case of installment sale, the return shall be filed within thirty (30) days following the receipt of the 1st downpayment and within thirty (30) days following each subsequent installment payment

- One return is filed for every transfer document regardless of the number of each property sold, exchanged or disposed of.