philippines estate tax
Posted in Philippines General Information on 06/01/2009 07:19 am by admin
Is there an income tax for an OFW who owned a lot in the Philippines which is leased for some company?
I am an OFW in the Middle East and have a 2k sqm lot in the Philippines and will be leased for some real estate companies. Am I obligated to pay taxes (property) or the people rented it? And the income from the lease, I need the obligations to pay income tax even if I am abroad?
As the owner, any property tax applies to your name. You are responsible by law, but may pass the cost down to your lessees. And if you are a U.S. citizen, you report any income in the Philippines and the United States. For us it goes to Schedule E of form 1040 and you report income and related costs to maintain and rent property. You are taxed on net. With foreign tax credits and deductions available to us. It's too complicated to explain here and you can have a CPA handle for easy you. However, if the net income from your rental property will not cause big tax you and do not use a CPA to do your return its not true worth worrying about foreign tax breaks. They usually reduce the blow of being taxed twice on foreign income. Hope this helps =)
