19/08/2026
π ONLINE SELLERS & ASPIRING MICRO-BUSINESS OWNERS β DID YOU KNOW?
Before you register your business using your primary residence as your business address, you may want to consider the possible tax implications when you eventually sell your property.
Under BIR rules, real properties that are used or have been used in trade or business may be classified as ORDINARY ASSETS rather than CAPITAL ASSETS.
π‘ Whatβs the difference?
πΉ Capital Asset β Generally, property held for personal or investment purposes and not used in the taxpayerβs trade or business. The sale may be subject to the tax rules applicable to capital assets.
πΉ Ordinary Asset β Real property used in, or held in connection with, a trade or business. Its sale can be subject to different tax rules, including possible income tax, withholding tax, documentary stamp tax, and in certain circumstances, VAT.
π The important point:
Using your home for business can have consequences beyond simply getting a business permit or BIR registration. The actual use and circumstances of the property matter.
So, if you're an online seller, freelancer, home-based entrepreneur, or aspiring micro-business owner, it may be worth considering whether you really need to register your residential property as your business location.
π’ Looking for an alternative?
Our firm is now offering a VIRTUAL OFFICE ADDRESS in Cabanatuan City at a very affordable rates.
You can have a business address without necessarily using your primary residence as your business location.
π© PM me if you're interested, and let's discuss the details.