Educational information only, not tax advice. Rules and figures change — confirm your situation with a qualified Philippines tax professional before filing.
Metro Manila, Philippines · Philippines · Short-term rental taxes
Short-Term Rental Taxes in Metro Manila, Philippines
Short term rental taxes in Metro Manila: on top of BIR income tax, each city — Makati, Taguig, Manila, Mandaluyong — needs a mayor's permit renewed in January, local business tax on last year's receipts and real property tax.
The 30-Second Answer
- Short-term rental tax in Metro Manila has two layers: the national BIR layer (income tax, 3% percentage tax or 12% VAT) and a city layer run separately by each of the capital region's cities and one municipality.
- Each city's Business Permits and Licensing Office issues the mayor's (business) permit, usually after a barangay clearance. Permits and local business tax are renewed in the first 20 days of January — Taguig ran its 2026 renewals from January 2 to 20.
- Cities tax lessors on the previous year's gross receipts at rates in their own revenue codes. Example: Mandaluyong charges residential real-estate lessors 1.10% of receipts above ₱50,000, and its schedule expressly covers condominium units.
- Real property tax in Metro Manila cities can reach 2% of assessed value, plus a 1% Special Education Fund levy. Your condominium corporation's master deed and house rules can restrict or ban short stays regardless of your permits.
Deductions
What Metro Manila STR Hosts Can Deduct
On graduated rates with itemized deductions, the city-level costs of running a Metro Manila condo are deductible alongside ordinary running costs. On the 8% option or the 40% OSD they are not claimed separately.
Keep official receipts from the City Treasurer for local business tax, permit fees and real property tax — those are the documents the BIR expects if you itemize. Association dues need the condominium corporation's invoice in your name.
Filing Calendar
Key Dates & Filing Calendar
Metro Manila hosts juggle a city calendar on top of the BIR's: permits and local business tax fall due in January, and real property tax can be paid yearly or quarterly.
Late local business tax attracts a surcharge of up to 25% plus interest of 2% a month — the rates Makati applied to late payers. Budget for January in cash, because the tax is based on last year's receipts, not this year's.
Local Government Code (RA 7160), Sec. 165; Taguig BOSS 2026 schedule (Manila Bulletin, 15 Dec 2025); Makati tax deadline notice (Philippine News Agency)
Tax Treatment
Small Non-VAT Host vs. VAT-Registered Operator
In Metro Manila the ₱3 million line decides more than VAT: it caps the 8% option, and your declared receipts also set next January's city business tax.
Non-VAT Host (Receipts up to ₱3 Million)
8% option or 3% percentage tax, plus the city layer
- Choose the 8% income tax on receipts above ₱250,000, or graduated rates plus 3% percentage tax.
- Pay the city's local business tax each January on the previous year's receipts — e.g. 1.10% for residential lessors in Mandaluyong.
- Renew the mayor's permit yearly with a sworn declaration of gross receipts that matches your BIR returns.
- Pay real property tax on the unit to the City Treasurer.
Gross receipts of ₱3 million a year across all units and platforms
VAT-Registered Operator (Above ₱3 Million)
12% VAT, graduated rates and a bigger city bill
- 12% VAT on stays, filed quarterly on BIR Form 2550Q; the 8% option is no longer available.
- Income tax at graduated rates of up to 35% on net income (or corporate tax if you operate through a company).
- City business tax grows with receipts, and each unit may need its own permit depending on the city.
- Expect scrutiny of zoning and building rules when a portfolio looks like a commercial lodging business.
No upper limit — VAT and city business tax scale with receipts
Depreciation
Depreciation for Metro Manila Condo Rentals
Metro Manila STR stock is mostly condominium units, where you own the unit and a share of common areas but not separately depreciable land. Depreciation only counts if you itemize on graduated rates.
| Asset | Typical write-off period | Notes |
|---|---|---|
| Condominium unit (pre-selling or resale) | Estimated useful life | Depreciate the unit's cost; keep the contract to sell or deed and the unit's tax declaration. |
| Interior fit-out of a bare unit | Estimated useful life | Kitchen, closets and ceilings installed for the rental are capital costs, not repairs. |
| Furniture, beds & soft furnishings | Estimated useful life | The worked example assumes 5 years; heavy-turnover items may justify a shorter life if documented. |
| Split-type aircon units & appliances | Estimated useful life | Routine aircon cleaning is a repair expense; replacement units are capitalised. |
Real property tax is assessed on the unit's assessed value in the city assessor's records, not on your depreciated book value.
The Philippines has no depreciation recapture rule. On a sale, the tax treatment depends on whether the condo is a capital asset or an ordinary asset used in your rental business — confirm the classification with your adviser before listing the unit for sale.
City Taxes & Permits
Metro Manila Business Tax, Permits and Real Property Tax
There is no Metro Manila hotel, occupancy or lodging tax on Airbnb guests. The city layer is a business tax on your receipts, permits and property tax — each set by the city where the unit sits.
What a Mandaluyong vacation rental host pays on top of national taxes, compared with the BIR business taxes:
City business tax (e.g. 1.10% in Mandaluyong) plus 3% percentage tax or 12% VAT, plus RPT
Mandaluyong — Revised Business Tax Code (mandaluyong.gov.ph); Local Government Code (RA 7160), Secs. 233 and 235; RA 4726; House Bill 3786 (20th Congress)
| Booking type | Who collects & remits | What it means for your books |
|---|---|---|
| Nightly stays in a Makati, Taguig or Manila condo | You pay the city's local business tax each January, based on last year's receipts | Rates differ by city revenue code — check your City Treasurer's schedule for lessors of real property |
| Unit owned, managed by a co-host or agency | The permit and business tax stay with whoever is registered as the business — agree this in writing | Make sure receipts declared to the city match those declared to the BIR |
| Unit left empty between bookings | City Treasurer bills real property tax to the owner | Up to 2% of assessed value plus 1% SEF in Metro Manila cities; deductible if you itemize |
Condominium rules sit on top of city law: under the Condominium Act (RA 4726), restrictions in the master deed bind every owner and can be enforced by the condominium corporation — many Makati, BGC and Ortigas buildings limit or prohibit stays of a few nights. A House bill filed in August 2025 (HB 3786) proposes LGU permits, night caps and platform tax withholding for short-term rentals; it is not law.
Platforms
How Airbnb, Booking.com & Agoda Handle Metro Manila Taxes
Airbnb tax in Metro Manila falls on the host: no platform collects a city tax for Makati, Taguig, Manila or other Metro Manila listings, and none renews your mayor's permit.
| Platform | Reports your income | Collects the local lodging tax | Annual earnings summary |
|---|---|---|---|
| Airbnb | No city report; declare every payout to the BIR and in your city permit renewal | No — Metro Manila is not on Airbnb's collect-and-remit list | Transaction history export for your January gross-receipts declaration |
| Booking.com | No city report; declare payouts yourself | No — no city lodging tax exists to collect | Invoice and payout statements in the Extranet |
| Agoda | No city report; declare payouts yourself | No — local business tax is paid by the registered business | Payout reports in the partner portal |
| Direct bookings | No third-party report | You — issue a BIR-registered invoice | Your own booking ledger and bank records |
Listing One Unit on Several Platforms?
Your city business tax base is the total receipts of the business — Airbnb, Booking.com, Agoda and direct stays combined. Export each platform's annual payout report before your January renewal so the declaration adds up.
No DAC7 — but the City Sees Your Declared Receipts
DAC7 is EU-only. In Metro Manila the practical cross-check is local: when you renew your mayor's permit you declare last year's gross receipts, and the city's business tax is computed on them. Declare the same figure you reported on your BIR returns.
Airbnb Help Center — Where Airbnb collects and remits taxes (article 2509); Taguig renewal requirements (sworn declaration of gross sales)
Illustrative P&L — Mandaluyong (Ortigas) 1-BR Condo, ₱
Example only: 240 nights at ₱5,500, host has no salary, 8% option elected. City business tax uses Mandaluyong's 1.10% residential-lessor rate on ₱1,200,000 of prior-year receipts. Permit fees are an assumption. Not tax advice.
Record-Keeping
Stay Audit-Ready in Metro Manila
Two regulators see your numbers: the BIR and your city's Treasurer and BPLO. Your condominium corporation will also keep its own records of guest registrations.
| Keep | How long | Why |
|---|---|---|
| Mayor's permit, barangay clearance and renewal forms | While operating + 5 years | Proves you were licensed for each year you hosted |
| Sworn declarations of gross receipts filed with the city | 5 years | Must match the receipts on your BIR returns |
| City Treasurer receipts for business tax and real property tax | 5 years | Evidence of payment and support for itemized deductions |
| Condo corporation approvals, house rules and guest-registration logs | While operating | Shows the building permitted your short stays |
| Platform payout reports and BIR-registered invoices | 5 years after the filing deadline | Supports BIR returns and the city declaration |
Keep your city and BIR paperwork in the same folder per year — the easiest audit defence in Metro Manila is one gross-receipts figure that matches everywhere.
Estimator
Short-Term Rental Tax Estimator
Plug in your bookings and costs to see your likely taxable position.
Your Numbers
Total short-term-rental income, before costs.
Allowable running costs, mortgage interest, depreciation and platform fees.
Your top income-tax band, as a percentage.
Estimated tax owed
Income tax on your net rental profit at your marginal rate.
Illustrative estimate. A simplified model to orient you — it is not tax advice. Confirm your situation with a qualified local professional.
Sources & notes
Educational summary of the Metro Manila city layer, based on the Local Government Code, city government publications (Mandaluyong, Quezon City, Taguig, Makati), the Condominium Act and Airbnb's tax pages, checked in September 2026. National BIR rules are covered on our Philippines page. Amounts in Philippine pesos.
- Mandaluyong City — Revised Business Tax Code: Graduated Taxes — Real estate lessors incl. condominium: 1.10% residential / 1.65% commercial of prior-year receipts above ₱50,000. mandaluyong.gov.ph/revised-business-tax-code-graduated-taxes/
- Local Government Code (RA 7160) — Sec. 165 payment in first 20 days of January; Sec. 233 RPT up to 2% in Metro Manila; Sec. 235 1% SEF. lawphil.net/statutes/repacts/ra1991/ra_7160_1991.html
- Quezon City — How to renew business permit — Barangay business clearance, prior permit and treasurer's receipt; QC E-Services. quezoncity.gov.ph/qcitizen-guides/how-to-renew-business-permit/
- Taguig — Business permit renewal 2026 (Manila Bulletin) — BOSS window 2–20 January 2026; sworn declaration of gross sales; tlcportal.taguig.gov.ph. mb.com.ph/2025/12/15/business-permit-renewal-in-taguig-set-in-january
- Philippine News Agency — Makati extends deadline for business, realty tax payments — 25% surcharge and 2% monthly interest on late business tax. pna.gov.ph/articles/1022350
- RA 4726 — Condominium Act — Master-deed restrictions bind all owners and are enforceable by the management body. lawphil.net/statutes/repacts/ra1966/ra_4726_1966.html
- House Bill 3786 (20th Congress) — Proposed Short-Term Residential Rental Regulation Act, filed 18 August 2025. docs.congress.hrep.online/legisdocs/basic_20/HB03786.pdf
- Airbnb Help Center — Where Airbnb collects and remits taxes — No Philippine jurisdiction listed. airbnb.com/help/article/2509
Questions
Frequently Asked Questions — Metro Manila STR Taxes
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