Rent is business income. A landlord or host registered with the BIR files two kinds of quarterly returns: income tax (1701Q for individuals) and a business tax. For most small landlords the business tax is percentage tax, filed on BIR Form 2551Q.
Who files 2551Q
- Landlords and hosts who aren’t VAT-registered, usually because their gross receipts are ₱3,000,000 a year or less.
- Not those who chose the 8% income tax option: the 8% covers both income tax and percentage tax, so there’s no 2551Q to pay.
- Not VAT-registered businesses: they file VAT (2550Q) instead.
Deadlines
2551Q is due 25 days after each quarter ends:
- January to March: April 25
- April to June: July 25
- July to September: October 25
- October to December: January 25
How much
Percentage tax is 3% of the quarter’s gross receipts (it was temporarily 1% from July 2020 to June 2023). Gross receipts means what you collected, before expenses. Residential rent of ₱15,000 a month or less per unit is exempt from business tax.
Example: a landlord collects ₱90,000 in rent in the quarter from units rented above ₱15,000 a month. Percentage tax is 3% × ₱90,000 = ₱2,700, less any tax a corporate tenant already withheld and gave you on Form 2307.
Filing and paying
File 2551Q with eBIRForms (or eFPS if you’re enrolled), then pay through an authorized bank or an e-payment channel the BIR accepts. Keep your filed returns and proof of payment with your records.
Let BahaySuite do the math
The BIR & taxes module adds up each quarter’s gross receipts from the payments you record, leaves out exempt residential rent, subtracts Form 2307 withholding, and shows the estimated 2551Q (or VAT, or the 8% option) with the next deadline. See BIR & taxes: invoices and quarterly estimates.
Part of Growth and All-in-One, or the ₱49 BIR & taxes add-on.