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For many Filipino families, owning a house and lot is more than just a goal. It’s a cherished dream. A home is a place to feel secure and a tangible sign of achievement. But alongside the pride of ownership comes the responsibility to pay realty property tax (RPT) each year, as required by the Local Government Code of 1991 (Republic Act No. 7160). To help you handle this responsibility, here’s a simple breakdown for new homeowners. 

Who Needs to Pay? 

If you own or manage property in the Philippines, whether for residential or commercial use, you’re required to pay realty property tax. Here are a few exceptions: 

What Does It Cover? 

Realty property tax isn’t just for the land. It also includes buildings, improvements, and any machinery located on the property. 

When to Pay 

You have two options for paying: 

If you miss a payment, you’ll incur a penalty of 2% per month on the unpaid balance, up to a maximum of 72%. In extreme cases, unpaid realty property tax can lead to the auctioning of your property. On the bright side, if you pay early, you might get discounts of up to 20%, so check for local announcements to see if you qualify. 

Where to Pay 

RPT payments are made at the local Treasurer’s Office in your city or municipality. 

How Much to Pay 

The realty property tax is calculated by multiplying the RPT rate by the assessed value of the property. 

Sample Calculation 

Let’s say you have a residential lot in Metro Manila valued at P1 million with an assessment level of 20%. Your assessed value would be P200,000. With a 2% RPT rate, your basic realty property tax would be P4,000. 

Local governments may also add an annual 1% tax for a Special Education Fund (SEF). If the property is idle or undeveloped, an additional 5% annual tax may apply. 

Protecting Your Property’s Value 

Paying realty property tax is part of responsible homeownership. Another way to protect your property is with insurance coverage, such as Cocogen’s Home Excel Plus. 

Cocogen Home Excel Plus is a comprehensive insurance plan designed to safeguard your home against unforeseen events. It not only covers your home but also detached structures like garages and fences, offering protection from: 

It also includes Kasambahay Coverage, which covers medical expenses and personal belongings for household staff. 

If your home becomes unlivable due to a covered event, you’re eligible for Lodging and Rental Allowance. Household Contents Coverage is included as well, covering items like furniture, appliances, and personal belongings in case of damage or theft. There’s also Personal Liability Coverage to protect you from legal issues if someone gets hurt on your property. 

To learn more about Cocogen Home Excel Plus, call our customer service hotline at 8830-6000, or email client_services@cocogen.com. 

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The views expressed are those of the author and do not necessarily reflect the views of Cocogen Insurance, Inc.