RELIEF SLSP for Commercial Building Lessors: Reporting Rent, CUSA Charges, and Utility Reimbursements

A commercial building lessor’s RELIEF Summary List of Sales (SLS) entry for each tenant should normally include base rent and any common-use-service-area (CUSA) management fee billed on top of it, because both amounts redound to the lessor’s own benefit as compensation for leasing and maintaining the space — but a utility charge billed strictly at cost, as reimbursement for a bill paid on the tenant’s behalf, can fall outside gross sales entirely under current invoicing rules. Getting this split wrong in either direction causes a real problem: understating SLS invites a RELIEF-vs-2550Q mismatch flag, while overstating it by sweeping in pure reimbursements inflates reported VAT liability on money that was never the lessor’s income to begin with.

Why rent and CUSA fees belong in gross sales #

Base rent is unambiguously part of a commercial lessor’s gross sales for VAT purposes, and so is a CUSA or common-area management fee billed as a separate line item, because both are compensation the lessor earns for leasing and maintaining the property — neither is money collected on someone else’s behalf. The current legal test for what counts as gross sales for a service-type transaction (leasing falls under “use or lease of properties”) comes from RR No. 3-2024, which amended Section 4.108-4 of RR No. 16-2005 under the Ease of Paying Taxes (EOPT) Act:

“‘Gross sales’ refers to the total amount of money or its equivalent representing the contract price, compensation, service fee, rental or royalty, including the amount charged for materials supplied with the services during the taxable period for the services performed for another person, which the purchaser pays or is obligated to pay to the seller in consideration of the sale, barter, or exchange of service that has already been rendered by the seller and the use or lease of properties that have already been supplied by the seller, excluding VAT and those amounts earmarked for payment to third party or received as reimbursement for payment on behalf of another which do not redound to the benefit of the seller.”

— RR No. 3-2024, amending Section 4.108-4 of RR No. 16-2005, as amended

A CUSA fee — covering lobby security, common-area cleaning, elevator upkeep, and similar building-wide services the lessor itself arranges — is “compensation” or a “service fee” the tenant pays in consideration of occupying and using the leased premises. It redounds to the lessor’s benefit because the lessor controls the contract, bears the cost of running those services, and typically marks the fee to cover its own overhead. That puts it squarely inside the gross-sales definition above, alongside rent.

When a utility charge can be excluded as a pure reimbursement #

The same RR No. 3-2024 definition carves out amounts “earmarked for payment to third party or received as reimbursement for payment on behalf of another which do not redound to the benefit of the seller” — the test a lessor’s utility billing arrangement has to pass to stay out of gross sales. In practice, this means a sub-metered electricity or water charge billed to a tenant strictly at the utility company’s own rate, with no markup, and clearly identified as a pass-through of the lessor’s own payment to the utility on the tenant’s behalf, has a real argument for exclusion. The moment the lessor adds a markup, service charge, or administrative fee on top of the metered cost, that excess portion stops being a pure reimbursement — it becomes compensation that redounds to the lessor’s benefit, and it belongs in gross sales like any other fee.

This is a facts-and-documentation question, not an automatic exemption: a lessor claiming the exclusion should be able to show the tenant’s actual consumption, the utility’s own billing rate, and that no markup was added — otherwise the BIR has grounds to treat the whole amount as part of gross sales on audit.

What goes on the RELIEF SLSP line for each tenant #

For the deposit row, see the companion post on RELIEF SLSP for advance payments and deposits for the full accrual-timing rule the EOPT Act introduced.

Worked example: a mall lessor’s tenant billing for the quarter #

Meridian Mall Leasing Corp. leases a 150-square-meter retail unit to a tenant for ₱90,000 monthly base rent, plus a ₱12,000 monthly CUSA management fee covering common-area security, cleaning, and elevator maintenance. The unit is separately sub-metered for electricity, and Meridian re-bills the tenant exactly what the utility charged for that unit’s consumption that month — ₱18,000, with no markup — clearly itemized as a utility pass-through on the invoice.

For this tenant, Meridian’s RELIEF SLSP entry for the month reports gross sales of ₱102,000 (₱90,000 rent + ₱12,000 CUSA fee) as VATable sales subject to output tax. The ₱18,000 utility pass-through is excluded from the SLS gross-sales figure as a reimbursement that doesn’t redound to Meridian’s benefit, provided Meridian can show the sub-meter reading and the utility’s own rate supporting that exact amount. If Meridian instead added a 10% handling fee to the utility re-bill, the full ₱19,800 utility line would need to be folded into gross sales instead of excluded.

Summary #

A commercial lessor’s RELIEF SLSP entry per tenant should always capture rent and any CUSA or management fee, since both are compensation under RR No. 3-2024’s amended definition of gross sales — the only item with a real argument for exclusion is a utility charge rebilled strictly at cost as a documented reimbursement. Reconcile this split against your BIR Form 2550Q output tax each quarter (see RELIEF SLSP vs. VAT Return Reconciliation) and keep the sub-metering and utility-rate documentation on file, since an undocumented “reimbursement” claim is the detail an audit is most likely to challenge. For the CWT side of the same tenant relationship, see SAWT for Real Estate Lessors: Reconciling Rental CWT.