I have an Avida condo unit that is under mortgage with BPI, and I already paid 1M of the total cost of the unit. I'm selling the unit for 2.4M and BPI said they will help the buyer get a loan so that he may continue with the payments. The plan is for the buyer to pay me 1M and the rest (1.4M) will be financed by BPI via a new loan account under the buyer's name. However, BPI is not sure how the capital gains tax will be applied. Will the capital gains tax be applied to the 1M that the buyer will pay me or will it be applied to the 2.4M cost of the unit?
I checked BIR Form 1706 and there are several options available for computing the tax base that will be used to determine the capital gains tax, but it's all very confusing (Cash Sale, Installment Sale, Foreclosure Sale, etc.). I just think that it isn't fair to impose the capital gains tax on the 2.4M when in reality, I will only earn "gains" from the 1M that the buyer will pay me, and the rest will be received by Avida as payment from the buyer via BPI (through a home loan ).
Any feedback will be greatly appreciated.