Buying or selling a property in the Philippines is not a simple matter of agreeing on a price and signing a contract. It also involves paying or collecting various taxes and fees that are based on the fair market value (FMV) of the property. The FMV of the property, in turn, is based on the BIR zonal value, which is an approved zonal schedule of fair market values on real property used by the Bureau of Internal Revenue (BIR) as a basis for the computation of internal revenue taxes¹.
The BIR zonal value is derived from the average prices of similar properties within a certain area or zone. The BIR commissioner has the authority to divide the Philippines into different zones or areas and determine the fair market value of real properties located therein upon consultation with competent appraisers both from private and public sectors². The BIR zonal value is updated periodically to reflect the changes in market conditions and property values.
As a buyer or seller of a property in the Philippines, you can use some strategies to benefit from BIR zonal value. Here are some tips:
Compare Different Zones and Locations
Since BIR zonal values vary depending on zones and locations, you can compare different options and find the best one for you based on your budget and preferences. For example, you can look for properties in zones with lower BIR zonal values to save on taxes and fees, or you can look for properties in zones with higher BIR zonal values to increase your property value and potential returns.
To compare different zones and locations, you can use online resources such as the BIR Website to search for the BIR zonal values for selected locations. You can also call or visit your nearest BIR office to get more information.
Negotiate the Selling Price
Since the selling price is one of the factors that determine the FMV of the property, you can negotiate with the other party to agree on a reasonable and favorable price. For example, as a buyer, you can try to lower the selling price to reduce your tax liabilities, or as a seller, you can try to increase the selling price to maximize your profits.
To negotiate the selling price, you need to consider several factors, such as:
- The condition and features of the property
- The demand and supply of similar properties in the market
- The prevailing interest rates and financing options
- The tax implications and legal requirements
You also need to have good communication and negotiation skills, as well as a clear understanding of your goals and limits.
Check the Latest BIR Zonal Values
Since BIR zonal values are updated periodically, you should check the latest ones before buying or selling a property. This will help you avoid paying or collecting outdated or inaccurate taxes and fees based on old or incorrect BIR zonal values.
To check the latest BIR zonal values, you can use online resources such as the BIR Website to search for the BIR zonal values for selected locations. You can also call or visit your nearest BIR office to get more information.
Consult a Professional
Since buying or selling a property involves complex and technical processes and calculations, you should consult a professional such as a real estate broker, appraiser, lawyer, or accountant to help you with the transaction. They can advise you on the best strategies and practices to benefit from BIR zonal value and comply with tax laws and regulations.
A professional can help you with:
- Finding and evaluating properties that suit your needs and preferences
- Negotiating and preparing contracts and documents
- Computing and paying or collecting taxes and fees
- Registering and transferring titles and ownerships
- Resolving any issues or disputes that may arise
BIR zonal value is an important factor that affects the fair market value and tax implications of buying or selling a property in the Philippines. By understanding what it is, how it is determined, how it is used, and what strategies you can use to benefit from it, you can make informed and smart decisions when dealing with real estate transactions in the Philippines.
U-Property PH 
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